Amazon’s Internet-of-things strategy takes shape
Amazon (AMZN) today unveiled Dash Buttons, an easy way for customers to order select bulk goods via an internet-connected button, and yesterday launched Home Services, an on-demand installation and handyman service. Combined, they show that the e-commerce giant has a clear understanding of how the Internet-of-things will benefit its business. And it isn’t going to be shy about capitalizing on connectivity to build its bottom line.
Dash Buttons are an adaptation of Amazon’s voice-controlled Dash ordering system that lets people speak to order new grocery items, and will allow Amazon Prime members to order one item with the push of an WiFi-based connected button. Amazon has 17 brands (including Bounty and Tide) on board at launch, so folks can re-order their bulk goods with a button-click.
Amazon also has advertised a developer program that allows companies to build re-ordering buttons directly into their own hardware. Listed on that page are partners such as Whirlpool (re-order laundry supplies), Brother (ink and toner), Brita (water filters) and Quirky (which is launching a line of appliances including a fancy pour-ver coffee machine). An Amazon spokesman says the first Dash-enabled devices will start showing up in the fall.
So what Amazon has is a retrofit strategy for connecting smart appliances to its e-commerce operations and a future-facing strategy for the coming flood of connected devices. And all of this is geared around making buying products from Amazon as easy as possible. The plan already was somewhat validated by the popular Internet-of-things startup If This Then That, which in February launched a one-button app that let users assign one task to a single button. For example, one of my one-button tasks was was posting a message to Slack whenever I left my desk.
The simplicity of one-button tasks are appealing, although it could lead to a mess of packages ending up at people’s doors if Amazon doesn’t try to minimize waste on its end, by grouping shipments together when possible. People on Twitter seem mostly concerned about pets and small children playing with the Dash Buttons and ordering multiples of their Kraft Macaroni and Cheese boxes, although Amazon notes that if the button is pressed more than once, the order doesn’t go through on the second time, and you’ll get a smartphone notification about it.
Amazon also recently launched Home Services, following up on last year’s opening of a home automation e-store devoted to connected gadgets for the home — many of which require a professional installer. So now Amazon can sell these devices along with the person who can install them.
It also is focusing on maintenance, via a network of service providers that it can call on for its network of suppliers or for its own planned connected home play –something I’ve previously advised companies interested in the connected home to do as a way of closing the loop. Because while data and the algorithms that will be used to detect when there is actually a problem in the home are going to be an essential ingredient, we will still need the people on the ground to fix those problems for a long time to come.
So far, Amazon is impressing me with its understanding of how the Internet-of-things can affect its business. With Dash, it’s making an offensive play to ring up more sales as devices come online. With Amazon Home Services, it’s making a defensive play as other large companies try to become more vertically integrated. My only question is where does the voice-activated Amazon Echo speaker fit into all of this? Is it, like the original Dash, more of a pilot devices designed to gather usage data to build other products, or is it an integral element for home control as I’m hoping?