What does it take for a retailer to be safe from Amazon’s growth, low prices, and customer service? Morgan Stanley’s Brian Nowak:
We introduce a five-factor framework to help investors think about industries’ susceptibility to Amazon disruption
In other words, do something different. Like what?
- Bespoke products that are unique and require lots of customization.
- Regulatory hurdles, or industries that make products which are thoroughly scrutinized by government authorities before they can be sold.
- Industry/business models with lower gross margins, lower order frequencies
- Attention post-sale would require in-person customer service for training and installation
- Nuances. Amazon is less likely to push into an industry in which purchase transactions are complicated.