Kindle Fire, Kindle arriving at 16,000 retail locations including WalMart

Kindle Fire and Kindle will be arriving at a staggering 16,000 retail locations starting on November 15th.

Stores include – Best Buy, WalMart, Target, Staples, Sam’s Club, RadioShack, Office Depot.

It’s all very puzzling.

The Madness of the Retailers?

It’s absolutely inexplicable to me that stores like Best Buy and Target and WalMart would sell Kindles and accelerate their own demise. Do they not realize that Kindle Fire is a direct connection to Amazon.com? That Kindle and Special Offers will end up eroding the sales of the retail stores?

With B&N we can rationalize that perhaps all these retail stores can’t think that far ahead. However, with Amazon – it should be obvious what’s happening.

Here’s what BestBuy’s senior VP says -

“We are excited to work with Amazon to provide consumers the opportunity to touch, test, try to buy the Kindle Fire in all Best Buy and Best Buy Mobile stores nationwide,” said Wendy Fritz, senior vice president of Computing at Best Buy. “The Kindle Fire and other new products in the Kindle family will be some of the hottest gifts this holiday season and we are delighted to offer these devices as part of our ever-expanding tablet and e-reader selection at Best Buy.”

She might as well say -

We are getting tired of selling all these electronics. So we though we should let Amazon get a direct connection to our customers and shift them over to buying from Amazon.com.

The strangest store on the list is WalMart.

Isn’t WalMart supposed to be Amazon’s mortal enemy?

My understanding was that WalMart sees Amazon as a major threat and has started WalMart.com in part to address this threat.

Why then, is WalMart strengthening Amazon?

WalMart is literally selling its customers mini-Amazon stores. That its customers will carry everywhere with them. It’s incredibly shortsighted and hard to believe.

Target’s One-Stop-Shop Strategy

The irony -

“Target is offering the new family of Kindle devices, including the Kindle Fire, to ensure Target is a convenient one-stop-shop for all of the season’s must-have gifts,” said Nik Nayar, vice president merchandising, Target.

Target wants to ensure its the one-stop-shop. So, what does it do? It starts selling its customers mini-Amazon Stores that will, in future years, be the one-stop-shop for these customers.

How is all of this not painfully obvious?

Perhaps there’s something I’ve missed.

How does it help retail stores to build up Amazon? How does it help them to accelerate the trend to online and mobile shopping? Are they really not concerned that people will start doing their shopping through Kindle Fires and at Amazon.com?

It makes zero sense. To sell some extra devices this holiday season, all these retail stores are going to sell away their customers to their most dangerous competitor?

15 Responses

  1. Seems like a bit of a stretch. Those store might as well ban selling anything that has a web browser like computers and phones since they are potentially gateways to amazon’s storefront. The Kindle Fire users will likely have wifi at home and that means they probably also have a computer… with a browser that can already access the amazon store. If the availability and accessibility to the amazon website hasn’t yet made users avoid physical stores, then having that same website in another form factor will probably not change that. Unless you’re counting impulse buyers on the toilet.

    • It’s different with a company like Apple or B&N that doesn’t yet sell physical products.

      Amazon sells everything.

      Q: Would WalMart put up a Target store within each of its stores? Would it encourage installing a Target kiosk in each of its customers’ homes?

      If not, then why do it with Amazon?

  2. “Perhaps there’s something I’ve missed.”

    “Would WalMart put up a Target store within each of its stores? Would it encourage installing a Target kiosk in each of its customers’ homes?”

    Perhaps, perhaps not, but Target and Walmart selling the Kindle Fire means that their customers also have access to THEIR ONLINE WARES as well. It’s a two way street. I think everyone benefits. Amazon benefits more because their store will be so easy to access on the Fire, but others will benefit and everyone in the chain gets a cut.

    In the end is the Kindle Fire a Trojan Horse? Yes, but in a different sense. Perhaps there will come day when Amazon no longer uses brick and mortars to get its devices to customers, but for now, Amazon needs the big retailers because of inertia: Many shoppers still like to go to a physical store versus the Internet. They want to ‘kick the tires’ before they buy something.

    • Lots of interesting comments. Yes, Kindle Fire is also a direct line to Target.com and WalMart.com. Certainly a risky move though. Amazon knows a lot about how to point users in certain directions. They hire some of the smartest people around to research and experiment with all this stuff.

  3. The stores are thinking of in-demand devices that their customers want, not of the rest of what Amazon sells. I certainly wouldn’t be happy if I asked a local retailer about a product but was told they won’t carry it because it was created by a competitor. That doesn’t make sense from a customer care perspective.

    Frankly, I shop far more at Target than I do at Amazon. They are my main grocery store and choice for last minute purchases. I’m not a Prime customer yet, but even with 2-day shipping there is a significant delay that I don’t have time for most of the time. In fact, I pre-ordered a CD that came out today and am now regretting it because I could have stopped by Target and purchased it for the same price but now have to wait a week to get it.

    I also don’t buy clothes or shoes from Amazon, they don’t have what I like or can afford. I prefer to try things on first, you can’t do that online.

    I usually do a lot of my Christmas purchases from Amazon because they usually have the best prices and selection (try buying ballet DVDs anywhere local), but that’s not always true. I got laptops for my husband and son from Newegg.

    I think there’s room in this world for both and always will be.

  4. So, it’s the beginning of the the end for all those retailers. I can see the same thing happening in the U.K. It really does not take much to see ahead that it really is the end of supermarkets. After all, all Amazon has to do is tie up some major grocery brands and you will have a simple home delivery service for dry goods. The really radical thing would be that if Amazon launches a bank, Amazon Bank. That really would put the cat amongst the pigeons.

  5. I don’t see that carrying Kindles would threaten the viability of stores such as Walmart, Target, etc. I do almost all of my grocery shopping at a Walmart Superstore. I would not buy food online not even the canned variety. One time, I checked Amazon.com for a particular brand of coffee that a friend loves. Amazon’s price was double that of our local Walmart.

    I don’t think that the stores have anything to fear from Amazon. A lot of people still do the majority of their shopping in stores and not online. However, it remains to be seen how all of this is going to play out.

  6. If I buy a Kindle Fire, I’ll probably buy it at Walmart. We bought our Kindles last year at Target because Walmart didn’t have them. Amazon and Apple are hurting book and music stores because of the instant download capability. I can’t instantly download new tires for my car or hamburger for my supper. Walmart sometimes makes marketing mistakes. This probably isn’t one of them.

  7. Target actually sells through Amazon if I was walmart I’d set up a Amazon storefront as well.

  8. I wonder what the retail store profit margin is on the Kindle products they sell. Amazon must be giving them a discount, and their profit margin on the Kindles isn’t high to begin with.

    • @Beth

      At the time that I bought my Kindle (from Amazon), Walmart was selling it at the same price as what Amazon was charging. However, Amazon won out because it doesn’t charge sales tax.

      • Yes, I know they retail for the same prices, but when a store buys the item from the manufacture they usually pay about 40-50% of the price, then sell it at suggested retail price (this allows the store to pay for retail space and employee costs and maybe make a profit). If Amazon is selling it to retailers for 40% off that is probably making it quite a loss for them based on what I’ve heard is the manufacturing costs.

  9. If they’re thinking that far ahead, I’d guess the thinking would be go something like this:

    1) Amazon’s going to sell these as fast as they can make ‘em.
    2) If people buy direct from Amazon, we won’t get anything.
    3) People with Fire tablets might buy from Amazon instead of us, yeah.
    4) However, they’ll have the tablets either way.
    5) Might as well make a few bucks selling these things!

    • Probably.

      In some ways Apple has created the perfect opportunity for Amazon & B&N to transition into this whole ‘device as retail channel’ mindset. Apple won’t sell to the 90% who can’t afford higher prices so everyone else can step in.

  10. [...] WalMart started selling Kindles it seemed, to me, the most insane decision ever. Here’s part of what I wrote (the link has [...]

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