Amazon.com, Inc. (AMZN) Survivors and the Lessons Learned

Borders, Blockbuster and Tower Records were just some of the many traditional brick and mortar retailers who fell victim to Amazon.com, Inc. (NASDAQ:AMZN) and its e-commerce brethren. Today these brick and mortar retailers no longer exist, exist in name only, or have a retail presence a mere fraction of their past glory. Whether it was Amazon.com, Inc. (NASDAQ:AMZN)’s strategy of undercutting competitors with razor-thin profit margins or offering products and services in new and innovative ways, these retailers had their business models completely obliterated by the revolution that was e-commerce.

Amazon.com, Inc. (NASDAQ:AMZN)Not all brick and mortar retailers have experienced such difficulties. Some have even thrived in the time of Amazon.com, Inc. (NASDAQ:AMZN). Let’s take a look at three such brick and mortar retailers to see what lessons can be gleaned.

More than Just Skin Deep
Who:
Sephora, subsidiary of LVMH Moët Hennessy • Louis Vuitton (NASDAQOTH:LVMUY).
What: Cosmetics and beauty products.
How: Offering an unmatched customer experience.

If any retailer epitomizes an outstanding customer experience, it is the cosmetics and beauty products retailer Sephora. With more than 1,400 stores in 30 countries, an online presence, and store shelves with hundreds of brands, Sephora is an absolute giant in the world of cosmetics retail. Sephora stores are designed to be a one-stop shop not just for makeup, skincare, bath and body, hair care and other beauty products, but for its services.

Known as Sephora Beauty Services, Sephora offers a number of free and incentive-based services for customers. These services include beauty and nail bars, free classes on a different beauty topic each month, free walk-in beauty sessions and one-on-one appointments with Sephora Expert Artists and Personal Beauty Advisors. These services accomplish the two main goals of any retailers. The free classes and walk-in sessions encourage customers to regularly visit their local Sephora and the inventive-based appointment services encourage buying; earning a 45-minute customized makeup application session with a $50 purchase or a 90-minute personal beauty advisor consultation with a $125 purchase. Good luck getting that kind of customer experience from Amazon.com, Inc. (NASDAQ:AMZN).

Rose-Colored Glasses
Who:
LensCrafters, subsidiary of Luxottica (NYSE:LUX).
What: Prescription framed and sunglasses.
How: Selling prescription required products and doctor required services.

LensCrafters is the largest prescription eyewear retailer in the United States. As a store that is dedicated to selling products that require a doctor’s prescription, it certainly helps to have an optometrist on-site to administer an eye exam, diagnose and treat any eye problems, and to prescribe corrective lenses if required.

And that is LensCrafters’ business model, operating with a doctor of optometry inside or next to a LensCrafters location, allowing both business entities to benefit each other presence. While online retailers can offer prescription eyewear, none of them have the ability to administer a doctor’s eye exam, offer savings on combined optometry service and prescription from purchases or to provide personalized sizing of the eyeglass frames to the unique shape of each customer’s head. Until the day when Amazon.com, Inc. (NASDAQ:AMZN) is somehow able to conduct all of these services through a user’s webcam, good old fashion human interaction remains a must for this retail segment.