Amazon, the e-commerce giant, will expand from cyberspace into brick-and-mortar space with its first store on Manhattan’s 34th Street in time for the holiday season.
Though the e-tailer has changed the state of shipping when shopping with its speedy deliveries, the only thing it as yet couldn’t do was compete with in-store immediacy. But Amazon’s latest experiment will test the success of its physical presence.
Citing unnamed sources, The Wall Street Journal said the space will function as a mini-warehouse with limited inventory for same-day delivery within New York, product returns and exchanges, and online order pickup. Customers could order a product in the morning and pick it up on the way home for the evening. Amazon may also use the retail space to display its devices like the Kindle, Fire smartphone or Fire TV, sources told WSJ.
But considering the company’s already thin margins, the costs of maintaining a physical space could prove unprofitable, and Amazon could change its plans if the experiment isn’t successful. But if it does do well, the company could roll out the retail stores in other U.S. cities.
WSJ said details about the store space, its size, lease length or amount of inventory it will hold, remain unknown.
At 7 W. 34th Street, the Amazon store will be across from the Empire State Building, and could capitalize on the site’s heavy tourist traffic, not to mention consumers a block away at Macy’s in Herald Square.
As consumers steadily look for that buy now, get now satisfaction, more retailers, like Gap, Macy’s and Target, are offering in-store pick up. Some, like Warby Parker and Bonobos, have even set up storefronts to allow consumers to engage with the brand on all channels.
Sporadic pop-up shops were before Amazon’s only physical presence, and its lockers, designed to accommodate deliveries and returns, while convenient, don’t offer same-day delivery.
Opening a physical location is “about marketing the Amazon brand,” Wells Fargo analyst Matt Nemer told WSJ. “Same-day delivery, ordering online and picking up in store are ideas that are really catching on. Amazon needs to be at the center of that.”