Amazon is allegedly looking at launching a chat app, code-named Anytime, that would integrate with its massive e-commerce site as well as with Alexa and (possibly) Twitch.
This is a brilliant idea for them, as it seems to be exactly what Facebook had been trying to pull off with Messenger when it attempted to allow brands to create their own messaging apps.
The prototype for this type of app is China’s WeChat, a Swiss Army knife style app that allows users to do pretty much everything from chat to book restaurant reservations, order a taxi, share videos of their dinner, pay for their dinner, write a review and send their friends a thank you present.
Amazon already has some of those pieces in place: you can order an Uber via Alexa, you can leave reviews and buy things on Amazon. You can now even make calls and leave messages via Alexa.
Amazon has no proprietary payment system yet, the way WeChat does with Tenpay, but it’s easy to see how the WeChat user journey can be replicated on Amazon, especially once you factor Alexa into the equation as the nexus of any sort of chat app—with Alexa, you don’t even need to have your phone handy, you can just talk and listen.
In addition to all the possible revenue from taking a cut on transactions and from launching its own payment system (AmPay? FirePay?) Amazon gains something else: data. Lots and lots of data.
As we are fond of saying, Facebook knows who we want to be, but Amazon knows who we really are. By tracking conversations, Amazon can tell, for example, how many people are talking about a new Nike sneaker, where those people live, how old they are, how many of them went on to actually buy the sneaker, what they did if they didn’t buy it (buy another brand? buy nothing?) what colors were most popular among different demographics and many many other details. They can tie that in to advertising seen via Amazon Fire TV—did it have an effect on sales? Where? With what demographics?
Then there’s Amazon’s really special trick: if Nike is game, they can try playing with pricing. Amazon notices that a lot of 20something males in Phoenix, Arizona who own iPhones are talking about the new sneaker. What if those users see an ad later that day that drops the price of the sneaker by $5. Does that move the needle? Does a $10 price cut? And what price point does it stop being worth it to Nike?
Amazon has an advantage here in that people already know what they’re about. Facebook ran into trouble with their Messenger play for many reasons, among them the fact that people had been using Messenger for a while to talk to friends, and as we first wrote ten years ago Your Brand Is Not My Friend: users don’t want brands sticking their noses into places they go to interact with friends. That seems doubly true if the main purpose of that interaction is to chat, as Snapchat is finding out the hard way.
Amazon, however, will face no such issues. It is an e-commerce app and anyone using its chat app knows that going in. So (if Amazon is smart about it, and they usually are) any kind of shopping experience will be both baked in and kept separate from the person-to-person chat experience.
The Monopoly Issue
WeChat has a virtual monopoly over the Chinese market which is not something the Chinese government particularly worries about: in China’s unique brand of communism, monopolies are okay.
The U.S., however is a different story, and as we’ve previously noted, there are rumblings (and then some) on the horizon about the monopoly status that Amazon has over e-commerce, along with calls for Congress or the courts to break them up.
That’s unlikely to happen under the current Trump-run administration, at least not while the economy is humming along. But should things head south, the barbarians may indeed appear at Jeff Bezos’s gate.
Breaking up internet-era monopolies is nowhere near as easy as breaking up Standard Oil or Ma Bell. But those were both considered huge challenges in their day too, and somehow we found a way.
While Amazon (and Google and Facebook, the other targets) have proven to be relatively fair and just autocrats, they are autocrats nonetheless, and we would not be surprised to see them split up sometime in the not too distant future.