Three Ways For Retailers To Survive The Amazon Fire Crusade

Editor’s note: John Haro is CTO of mobile wallet management company Vibes

On July 25 Amazon began shipping its Fire phone, which includes Firefly, software that instantly recognizes products you can directly purchase on Amazon. Hot on the heels of this announcement was the news that Amazon released a beta version of its mobile wallet, Amazon Wallet, which will allow users to save gift cards to their devices. For traditional retailers, Amazon has long been the 800-pound gorilla in the room, looming large over retailers trying to survive in this fierce battle. So both of these launches have been met by concern among many of them.

Showrooming emerged as early as 2011, when Amazon offered consumers up to $15 off to price check items in-store. Clearly, the purpose of both Firefly and Amazon Wallet are to make it even easier for consumers to purchase items from the e-commerce giant.

Amazon understands where the fight for the future of commerce lies: Making the retail experience as frictionless as possible on the mobile device. While mobile-influenced commerce is estimated to be a $593 billion opportunity, shopping cart abandonment on mobile devices is a staggering 97 percent because retailers have failed to adapt to the small screen. With Firefly and Amazon Wallet, Amazon seeks to fix this problem, taking a shot at both brick and mortar and online retailers.

As Amazon gets ready to enter the mobile shopping battle, the competition needs to respond. Here are three things retailers can do to stay alive: 

1. Leverage existing mobile wallet apps

Retailers can tap a number of mobile marketing tools to increase engagement and reduce friction. While 85 percent of consumers see the benefit of mobile wallet apps, many brands are not fully leveraging Apple’s Passbook and Google Wallet – the two existing players in the mobile wallet market. This chasm will only expand if the rumors prove true that Apple will soon release its own integrated wallet system for the iPhone.

Utilizing these apps to distribute mobile wallet content is a great way to counter the Amazon takeover. Distributing offers and loyalty cards via mobile wallet allows customers to instantly save them to their smartphones for easy redemption in-store.

2. Get onto the mobile lock screen

As inboxes get smarter and email open rates drop, retailers should invest in building mobile directly into marketing databases, using Push and SMS — technologies that provide marketers valuable access to the mobile lock screen. This could give you an edge in the market as 92 percent of marketers still rely on email, with only 28 percent using mobile messaging and 40 percent using mobile applications.

Push and SMS boast a 98 percent open rate (email only has a 22 percent open rate). They also have the added benefit of showing up on a phone’s lock screen, so consumers will still see the message even if they don’t open it. This approach is the more direct, frictionless way for you to engage with your mobile customers. (We all know that consumers will almost always take the path of least resistance to get what they want.)

3. Create a mobile loyalty program

Loyalty is harder than ever to earn. Consumers have so many choices that they can simply go for whoever offers the lowest price, which is largely why Amazon is taking over. One way to combat this is through mobilizing your loyalty program.

According to Forrester Research, 50 percent of consumers who participate in loyalty programs want mobile gift cards and reward certificates. If your brand has an existing program, creating a mobile wallet version simplifies the loyalty experience. It also adds value to your loyalty program by giving marketers additional opportunities to engage, recognize and reward their best customers. It deepens the connection that consumers have with the program by incorporating perks like location awareness and the convenience of never forgetting a loyalty card at home.

Of course the Fire has its share of critics — Hiroshi Mikitani, CEO of Rakuten, Amazon’s e-commerce rival in Asia, recently stated that Amazon is misguided and should focus more on pushing content to the mobile channel via messaging. And whether or not retailers go rushing toward their known enemy to participate in Amazon Wallet through anything other than gift cards remains to be seen

But to win on the mobile battlefield, retailers should spend less time worrying about Amazon and spend more time learning from them. Amazon’s Fire phone, Firefly and Wallet are strong indicators of its commitment to and focus on the mobile customer. For brick-and-mortar and online retailers to survive this battle in the market, they must embrace mobile. Let the battle begin.