How Amazon is making ‘buying’ invisible & why that transforms the standard
As Steven Van Belleghem eloquently explains in his keynotes (and in his upcoming book ‘Customers - The Day After Tomorrow’): a lot of companies have moved on from ‘digital first’...
‘AI first’ - throughout the entire organization
One of the companies that has understood this to a tee is Amazon. Maybe not surprising, seeing that its very core – the recommendation system that made the early amazon.com so successful – is rooted in a form of AI. But it has moved on far beyond that. Since then, AI has spread into every last layer of the company: throughout its services, products, logistics, customer interaction, fraud detection, translations and many more.
Its most visible AI rock stars are obviously the cloud-based AI assistant Alexa and her ‘Home’ (pun intended) Echo as well as the Amazon Go convenience stores with their Just Walk Out technology. The Prime Air delivery drones have gotten quite a lot of the attention as well. But there’s also Amazon’s 45.000 AI-enabled robots streamlining the process in its warehouses. And let’s not forget ‘Amazon Web Services’ that makes advanced machine learning and AI services available to basically any organization, even those that don’t have the budgets for an entire army of AI wizards.
“Software may be eating the world, but Amazon is eating ‘buying’”
It’s safe to say that over the last few years, Amazon has become a company that lives and breathes AI. And it has the recruiting numbers to prove it: an average annual investment is $227.8 million with 1178 AI jobs posted.
‘AI first’ is just a synonym for ‘Customer First’
But don’t be fooled into thinking that Amazon is focusing so much on this technology because “AI is hot” (and it IS hot, if you see what Facebook, Google, IBM, Microsoft, Apple and Intel are investing). The actual reason is that Amazon is and always has been obsessively focused on the customer. Consider CEO Jeff Bezos’ own words in his recent letter to the shareholders:
There are many ways to center a business. You can be competitor focused, you can be product focused, you can be technology focused, you can be business model focused, and there are more. But, in my view, obsessive customer focus is by far the most protective of Day 1 vitality.
Amazon’s use of AI is at its very best when it’s chasing the removal of any friction and any distance between itself and its ‘obsession’, the customer. And that includes the elimination of the buying process. The latter is a perfect example of how “innovation is about making things invisible”, as Peter Hinssen explains in his new book ‛The Day After Tomorrow’.
Software may be eating the world, but Amazon is eating ‘buying’. Because the process of looking for something, deciding to buy it and then actually doing so is creating a lot of distance between the customer and the company: each time something goes wrong, a customer could pull back. But what if you could close that gap? What if – ironically – you could time warp consumers back to being hunters and gatherers. What if there was no more formal ‘exchange’, but people could just take what they want and leave?
“You go in, hunt, gather and get out: buying made invisible”
That’s exactly what Amazon is trying to do with AI. First, there’s Amazon Echo and its voice assistant Alexa: basically, consumers ask what they want and Alexa gets it for them. They can order pizza, call an Uber and (obviously) ask for anything that ‘The Everything Store’ Amazon has to offer. There’s no actual buying involved anymore: there’s no finding things, putting them in a (virtual) basket, checking out, filling in card details. There’s only asking. It’s buying made invisible.
The same goes for the brick-and-mortar stores of Amazon Go: you go in, activate the app, take what you want and step out. There’s no cash registers, no queues and no paying. You go in, hunt, gather and get out. Again: buying made invisible.
Removing friction in music
One of the lesser known, but equally amazing AI projects of Amazon is headed by the fantastic Belgian and Berkeley Professor, Gert Lanckriet. Here too, the friction between the user and Amazon is being completely removed. At Amazon Music, Gert is basically investigating how he can automatically offer the right music at the right time to people: based on the music preference patterns of the listeners but also through sensors that detect his or her movement. If the sensors are, for instance, noticing that someone is going for a run, the music will accordingly become more upbeat. If someone is coming home from a long day at work and his or her body shows signs of stress and agitation, the music might be soothing. The main aim of the project is to adapt music to the personal likes, activity and feelings of the users. Something which could also perfectly be used in healthcare to, for instance, treat patients with depressions, … but that’s another story.
Obviously, Lanckriet’s technology will allow Alexa-users to give commands like “play me some happy music with guitar solos” as well. But, for me, the most interesting part of his project is how he is trying to offer people an automatic soundtrack that is attuned to what they are doing and feeling. And how these insights will make the Amazon AI systems even smarter.
Convenience is everything in today’s market. Customers are no longer loyal to brands but choose the most comfortable service out there. And Amazon’s ‘invisible’ buying is the ultimate type of convenience: easy, fast and without hassle, waiting or any type of friction. If you are in any way trying to make your company more customer centric (and you should), then you have a lot to learn from how Amazon is using AI to eat ‘buying’ and become closer to the customer than ever.
Want to learn how Amazon Music and AI rock star Gert Lanckriet are working towards the ultimate convenience and customer obsession? Join us on our Innovation Tour to Silicon Valley in September.