business news in context, analysis with attitude

by Kevin Coupe

The Sacramento Bee has a story about how Amazon lockers are being added to a number of Safeway store lobbies, in addition to the 7-Eleven and Circle K convenience stores where they more traditionally have been placed since the Amazon locker program began in 2011.

There are a couple of interesting pieces of information within the story, as well as another question unstated in the piece, worth noting.

First, Amazon seems to have adopted a new approach to the lockers, actually giving them names - like Bram, Dottie, Amanda and Delaney - instead of the numbers that it traditionally has used. That would seem to be a page out of the Zipcar playbook; the disruptive car rental service has always named its cars. I'm not sure of this means that Amazon did some research suggesting that names instead of numbers make the enterprise more user-friendly, or if this is just a test to see if names work better. But it'll be instructive to see if Amazon continues the practice down the road.

Second, there is note in the story that "the number of deliveries could surpass the capacity of the lockers at a given site, a situation that Amazon said it will monitor closely during the holiday shopping season." I have no idea of this is a real concern, or just a bit of hyperbole designed to hype the offering. But let's see if Amazon starts sending out press releases in a couple of months talking about a locker availability shortage.

Finally, the question. I cannot help but wonder about the advisability of Safeway providing easy access - not to mention the free advertising that comes from just having the lockers highly visible in the store lobbies - to an installation operated by a major competitor.

I'm sure Safeway wouldn't put Kroger lockers in its stores. Or Bristol Farms lockers. So why Amazon?

I'm sure they've done a risk-reward analysis. But if there could be an intangible benefit to Amazon from having such positioning and accessibility.

It'll be interesting to see if Safeway has made a short-term decision here that ends up having a negative long-term impact.

In other words, this could end up being an Eye-Opener.

One other thing ... I was in Lubbock, Texas, last week giving a speech just a couple of blocks from the campus of Texas Tech. And while walking over to pick up a cup of coffee at a nearby Starbucks, I noticed a store with an Amazon banner ... and it ended up being one of the locker stores that it has been opening near college campuses around the country in an effort to get students locked into behavior that will persist into middle age and sustain Amazon's growth. (Pictures below.)

I asked the young woman working at the counter, and she told me that the store only had been open for a couple of weeks ... and that they'd never had a day so far in which they had fewer than 100 deliveries and customers.

Which is another sort of Eye-Opener.

KC's View: