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LET'S GET PHYSICAL

Why Amazon is betting on stores

A customer carries his shopping bag as she walks out of a newly-opened Amazon Go store in New York.
AP Photo/Mark Lennihan
Where is it all going?
Marc Bain
By Marc Bain

Fashion reporter

At the heart of Amazon’s founding was the premise that e-commerce offers certain advantages physical stores just can’t match. Online shops are accessible from anywhere with an internet connection; they’re open 24 hours a day, seven days a week; and they’ve got unlimited shelf space. In his 2018 letter to shareholders, founder Jeff Bezos said if Amazon were a physical store, it would stretch across six football fields.

But Bezos also made two other points in the letter: First, stores are still where most shopping happens. Today in the US, only about 11% of sales are online, and while they’re quickly growing, that still leaves 89% of sales offline. Second, as Amazon gets larger, everything needs to scale with it, including the size of its experiments if it intends to keep generating new ideas. Stores are a project that can work for both. To keep up the fight in retail and find new ways to innovate, Amazon has decided to get physical.

AP Photo/Mary Altaffer
The 4-Star store in New York.

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