There’s no denying Amazon has changed the retail landscape. When the site debuted in 1994 as a purveyor of college textbooks, primarily, nobody could have predicted the massive effect it would eventually have on consumerism in general.
The company has disrupted the worlds of technology, retail and media in so many ways, and it doesn’t seem poised to stop innovating any time soon. The one thing Amazon has kept consistent, however, is its penchant for mobile, tech-based solutions. From e-reading to unlimited cloud-based photo storage, from streaming original TV content to one-click ordering on the go, most everything Amazon offers is controlled through your online account, which is connected with a credit or debit card for easy payment.
That’s why their newest venture might be surprising. It’s cash.
The giant e-retailer is giving consumers another way to pay and partake in their services. Amazon Cash is designed primarily for the 9 million American households that are unbanked, the 24.5 million that are underbanked, and consumers concerned about credit card security and identity theft online.
Here’s how it works: Amazon provides the user with a unique barcode, which they take to a participating retailer, where a cashier reads it with the store’s scanner. From there, they can add any amount between $15 and $500 in cash to their Amazon account. There are no fees, and the money becomes available to use instantly.
The service is hugely beneficial to the unbanked, underbanked and technologically wary among us, but what about to the retailers facilitating the transactions? Are they potentially giving up sales of their own product by playing a middleman between Amazon and customers?
Participating brick-and-mortar locations, which include CVS, GameStop and Sheetz, have at least one thing going for them in this situation – even with talk of drone deliveries, Amazon isn’t instantaneous. There’s a good chance that when a customer goes into a store to refill their account with cash, they’ll end up leaving with a few on-site purchases too.
That Amazon has chosen retailers where shoppers are prone to make quick stops is likely no accident. These retailers compete less directly with Amazon, offering many products that people don't want to wait a few days to get. Retailers offering Amazon Cash services can become a one-stop shop for consumers who want to engage in both online and offline commerce without a lot of hassle.
But don’t forget about all that extra cash in stores. Participating retailers would be wise to consider the cost of accepting cash and the challenges that an influx of cash might bring. It could mean more idle cash in stores or higher bank and transportation fees.
We’ll have to wait and see how Amazon Cash affects offline retailers, but one thing’s for sure — when even Amazon recognizes the importance of cash, your organization should too.