Just like Don Corleone in the epic Godfather movie, the folks at Washington-based e-commerce giant Amazon are about to make offers to their business partners, the company hopes they can’t refuse. That the firm, like Corleone, relies on ‘capos’ to enforce these offers, can be doubted, but they have a treasure the Mafia never possessed. Amazon’s immense knowledge about their business partners, generated from all sorts of data, takes the firm to a stage where it plans to rely a huge part of its channel domain on its recommendation system. But let me explain.
After establishing overnight delivery years ago and the introduction of the ‘drone delivery service’ last summer, the firm filed a patent in January with the bulky name ‘anticipatory shipping’. The idea behind it could revolutionize the e-commerce environment. According to techcrunch.com the system is the next ‘step towards cutting out human agency entirely from the e-commerce roundabout’ (1). When set up properly the automated collaborative filtering algorithm will learn from the behavior of registered consumers and anticipate what they could possibly be interested in, before the consumers themselves think about it. When matched with a specific product, Amazon plans to wrap the item and send it towards the potential customers before an order has been placed. This means slashing down shipping time by relying on clients’ historical buying patterns, preferences expressed via surveys, demographic data, but also browsing habits, wish-lists and even mouse movements (1). Essentially, the system entirely outsources the consumers’ shopping experience and direct communication with Amazon on basis of an online recommendation agent.
Consumer Value Creation 