In the 20 years since Amazon entered the consumer electronics category, the business has mushroomed from an unauthorized thorn in vendors’ sides to an industry giant — approaching sales parity with Best Buy and revolutionizing CE with its own bleeding-edge devices and technologies.
Now, the stewardship of Amazon’s CE retail business has been entrusted to Steve Downer, a GE appliance alumnus with a mechanical engineering degree from Purdue and an MBA from Northwestern. After 14 years in Louisville, Ky. (and three for GE in Europe), he joined Amazon in 2013 as general manager of its PC and IT assortment, and spent six months running the retailer’s B-to-B unit before being tapped as director/GM of consumer electronics.
In his current role he honchos the CE merchandising team, plus a C3Tech group responsible for the complete site experience, and a retail leadership development team that leverages Amazon’s secret tech-and-data sauce to shape the next generation of GMs.
In his downtime, Downer fielded five burning questions from TWICE, and made no bones about Amazon’s big bet on voice control and Alexa.
What are the most compelling tech trends of 2019?
In 2019, we’re seeing many emerging product innovations in categories such as TVs, wireless and home audio that will delight customers. While some of these technologies may not experience broad adoption for a couple more years, they will spark interest for early adopters.
We’re seeing multiple manufacturers launch 8K TVs, which will offer sharper and more detailed images compared to 4K UHD TVs thanks to the significant increase in pixels, offering window-like views. This spring, customers can shop many newly launched 8K TVs from top manufactures on Amazon, and as we expect there to be limited content available in 8K in early 2019, we believe that 4K TVs will continue to be the most meaningful option for most customers.
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At CES, a number of brands announced Wi-Fi 6 products launching this year, including Wi-Fi security cameras, smart TVs, Alexa built-in devices, computers, game consoles, phones, tablets and connected vacuums. As customers have a number of devices in their homes or businesses that rely on fast connectivity, these products will help devices benefit from a fast connection, particularly when customers are using many devices at the same time.
We are also seeing improvements in and maturation of true wireless headphones and smart watch technology, which will account for broader customer adoption and new iterations. In 2018 we saw a shift in customer preferences towards true wireless earbuds. While Apple AirPods led the growth the past year, others brands including Bose, Sony, Sennheiser, Bang & Olufsen, Jabra and Jaybird have been adding to and innovating the portfolio, creating more customer choice.
Smart watches have gained momentum, especially as the ability to be connected via LTE without a smartphone has accelerated adoption. Smart watches are no longer just for fitness tracking; they can now help customers be even more connected, access smart-home notifications, send and receive messages, and more.
We believe that voice is the future and it will fundamentally improve the way people will interact with technology. It can make the complex simple — it’s the most natural and convenient user interface.
We’re excited to see how customers continue to take advantage of the voice-first, hands-free convenience Alexa brings to their daily lives. Today there are more than 28,000 smart-home devices from more than 4,500 unique brands that are compatible with Alexa — and we expect that number to continue to grow in 2019.
We also anticipate even more device makers will integrate Alexa directly into their own products. Alexa is already built into familiar form factors like speakers and smart-home hubs, but we’re seeing exciting use cases in other categories as well, including headphones, PCs, gaming peripherals and even cars.
How do you determine which merchandise will be sold directly and which will be the province of third-party sellers?
Amazon, like all retailers, makes decisions about the products sold in its stores. This includes regular assortment decisions in order to provide our customers with the best experience.
Amazon has policies in place to ensure that brands selling in the Amazon store meet our standards for customer experience. We measure customer experience in a number of ways, including high in-stock rates, delivery experience, price competitiveness, and selection coverage. In some cases, to preserve our customer experience, Amazon may choose to source products from a brand for sale by Amazon only.
Describe the interplay between Amazon’s CE managers and their counterparts at Amazon Devices.
We share the same goals of offering customers a broad selection of devices while delivering a great customer and shopping experience. The Smart Home Store, available at amazon.com/smarthome, is an example where we bring together thousands of products spanning home improvement items like Wi-Fi thermostats, connected lighting, wireless entertainment technologies, and more. Customers can find a variety of products and solutions from Amazon and our suppliers for added security, convenience, piece of mind and entertainment.
How are you addressing slowing market segment share gains?
Since Day 1 we have obsessed over what we believe our customers care about — incredible deals and low prices, fast and free shipping, and a wide selection of top products — and we continue to provide all three, all the time.
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We’re constantly thinking of new ways to delight our customers and deliver a simplified and more enjoyable shopping experience. As we look forward to 2019, this means focusing on emerging technologies such as voice assistance for the home and beyond. As noted earlier, we believe that voice is the future and that voice will fundamentally improve the way people interact with technology. We are continually adding new selections from third-party brands that work with Alexa, or have Alexa technology built into the product itself.
To help customers discover these types of products, we are focused on creating the best content possible to demystify and educate, as well as providing services such as installation and tech support to further enhance the customer’s purchase journey. We are also working to make it easier for customers to discover accessories and bundles for their base products.
What is Amazon’s labor strategy for smart-home installations as the category becomes more expansive and complex?
Amazon Home Services covers nearly the entire country offering everything from smart-lock installation to Wi-Fi irrigation replacement. We will continue to expand our service offerings to keep pace with the increase of smart-home products.