UPDATED 22:49 EDT / AUGUST 19 2021

EMERGING TECH

Report: Amazon is planning to get into the department store business

Amazon.com Inc. is branching out again, with reports today saying the company is on the verge of opening several large brick-and-mortar department stores in the U.S.

The company hasn’t confirmed the move, calling the details of a report on the matter in the Wall Street Journal “rumors and speculation,” although the Journal said plans are already in action in the states of Ohio and California.

People familiar with the matter said as yet it’s not certain what will be sold in the stores, but “the company’s private-label goods are expected to feature prominently.” Things may change, but the report said the stores will be similar to other department chains, so it appears Amazon wants to disrupt a market it already helped disrupt when it realized the full potential of e-commerce.

The stores will be slightly smaller than some of the other chains, with each expected to occupy about 30,000 square feet. That’s about a third smaller than some of the larger department stores in the U.S.

Amazon already has brick-and-mortar stores. It currently has 29 convenience stores, most of which are in the U.S. Earlier this year, the company opened its first high-tech, full-size Amazon Fresh grocery store, a rebrand of the Amazon Go stores. It uses sensors and other technology so customers never have to go through a checkout.

The department store market in the U.S. has seen a steady decline over the last decade. COVID-19 and the ensuing lockdowns made matters even worse, with a handful of large chains closing forever, although reports suggest that things are about to change.

Analysts have said that although e-commerce reigned during the unpleasant era when people were sequestered in their homes, folks now want to get back to the high street more than ever. “People are absolutely returning and shopping in department stores,” said John Idol, chief executive of the Michael Kors parent Capri Holdings.

“Amazon knows that the future of retail is multichannel… most consumers still shop using a combination of stores and online,” Neil Saunders, managing director of retail analyst group GlobalData, told the BBC. “Stores will help Amazon do a much better job of showcasing its offer.”

Photo: Simon Bak/Unsplash

A message from John Furrier, co-founder of SiliconANGLE:

Your vote of support is important to us and it helps us keep the content FREE.

One click below supports our mission to provide free, deep, and relevant content.  

Join our community on YouTube

Join the community that includes more than 15,000 #CubeAlumni experts, including Amazon.com CEO Andy Jassy, Dell Technologies founder and CEO Michael Dell, Intel CEO Pat Gelsinger, and many more luminaries and experts.

“TheCUBE is an important partner to the industry. You guys really are a part of our events and we really appreciate you coming and I know people appreciate the content you create as well” – Andy Jassy

THANK YOU