Kindle Fire: 1st Mobile Shopping Device

 

Kindle Fire
Kindle Fire by Amazon

Analysts are upping their forecasts for Amazon Kindle Fire’s US sales to 5 million before year end. Departing from its first e-book incarnations, the Kindle Fire is a full colour, touch screen tablet with a proprietary browser called Silk.

Most commentators are discussing what it will do to media distribution and the iPad.

In this post, I argue that the Kindle Fire is not an eBook, much more than a rich media tablet, probably our first real mobile shopping device

Christmas Season’s Killer
CNET reports that financial analysts such as Kumar and DiClemente are upping their sales forecast for Amazon’s latest Kindle, the Kindle Fire. On pre-order since September 28, 2011 the Kindle Fire has received 95,000 pre-orders on the first day and more than 200,000 in the first 6 days – including mine (I actually ordered two)!

This is HUGE. It’s half the number of iPads that will be sold worldwide in the same quarter. Hopefully, Amazon will be able to deliver.

The main reasons why the Kindle Fire will be a Christmas Season’s bestseller are:

  • Books, music and video still are the top choice, defaults, ‘no brainer’ gifts during the holiday season. If you don’t want to choose which book, album or else… offer the entire library!
  • Amazing $199 price point ! At $199, the Kindle Fire costs less than half the price of the cheapest iPad ($499). According to research cited by BusinessToday, it costs Amazon more than $200 to manufacture the Kindle (so far, but at 5 million units, the unit cost will certainly drop lower).

Shopping Tablet
Most commentators discuss the Kindle Fire in comparison with the iPad in the context of media distribution: Will Amazon try to squeeze as much value from media companies as Apple does? Will there be a Flipboard for Kindle?

However interesting, these discussions don’t measure up to the true potential of the Kindle Fire. In my opinion, the Kindle Fire will be the first true mobile shopping device. Smartphones are a bit too small to comfortably select and buy products and non-digital services online. At 400 grams the Kindle Fire is 1/3 lighter than the iPad and could be the ideal mobile shopping device.

My take is that it will be much easier for Amazon to make a difference in mobile shopping than for a device manufacturer like Apple, an application publisher like Google or a social network like Facebook.

Here is in more detail why I see Amazon succeeding at turning the Kindle Fire as a mobile shopping device:

  • Universal retail: The essence of Amazon’s brand is retail. Amazon knows every aspect of retail in almost every sector. Amazon US sells everything from books to diapers, shoes and autoparts. It even recently started to sell fresh products — going literally from nuts to bolts!  In the US, Amazon’s retail brands have an amazing 90% reach. That a lot of retail goodwill to underpin mobile shopping.
  • 1-click retail . It’s so easy to purchase on the Kindle that one often inadvertently purchases books — that Amazon quickly reimburses. The 1-click purchase system available both on the Kindle and the Amazon web sites will make it very easy for Amazon to expand Kindle sales beyond digital media products. From my own experience: I’ve shifted over 80% of my book purchase to the Kindle and 20% of my other purchases (high-tech, cartridges etc.) to the Amazon Web brands. Amazon is one of the few retail brands with decent account management.
  • Retail ecosystem: Amazon sells through its own leading retail brands such Amazon, Diapers.com and Zappos. But as a marketplace that drives 30% of Amazon’s revenue, Amazon can rope in 2 million active sellers certainly keen to sell through the Kindle Fire.
  • Cloud-based Platform:  The hardware technology delivered to Amazon by Quanta for the Kindle Fire seems pretty good, so does Amazon’s proprietary Silk browser. But most importantly, Amazon’s technology puts together a Cloud-based platform of applications designed to beat Google, Apple, Facebook and everybody else at eCommerce.  Already for book-reading, Kindle is not so much a set of devices as a reading application in the Cloud that allows users to select books from their library and take them to their Kindle on iPhone (reading in the subway, or during any short dead time), their Kindle 3 (reading in bed, in the train), their PC (reading something that requires Web access), and soon the Kindle Fire (reading/viewing an interactive, rich media). In the near future, the Kindle Fire will be the mobile link of Amazon’s universal shopping application ! On that note, Loic LeMeur recently pointed out insider Steve Yegge’s post published on SiliconFilter that gave (involuntarily) an insider view of how Amazon succeeded vs Google failed as a platform.
  • A service company: The cement of Amazon’s ecosystem is not its technology but its service orientation.

More on November 15 2011 when I will (hopefully) have my Kindle Fire!

3 comments

  1. roc says:

    Thanks to a tweet by JM Billaut, I found a post by ReadWriteWeb reporting research from Alexander Interactive that agrees that Amazon is best positioned as a tablet retailer and gives several tips on how to optimize an eCommerce site for tablets. They don’t discuss the (in my opinion major) 1-click buying advantage, though. http://cdn.at.ai/downloads/Ai_TabletCommerceEvaluation_2011.pdf
    Quote: Amazon.com is the top revenue-producing Internet retailer, and its site is the most tablet-optimized of the list. A redesigned navigation bar, bigger buttons and the “Shop by Department” feature are clean on both a monitor and a tablet. Though the site was not built specifically for the tablet, it almost feels like it was.

  2. Anon says:

    To put the number of Kindle Fire orders in perspective: In the first weekend after launch, Apple took 4 million orders for the iPhone 4S
    http://www.apple.com/pr/library/2011/10/17iPhone-4S-First-Weekend-Sales-Top-Four-Million.html

  3. Amit Agarwal says:

    The User Agent String of Kindle Fire Revealed: a lot more people are likely to browse the web on their Kindles. And, as a website owner, the only way for you to detect this Kindle traffic is by looking at the User Agent String of the referrer in your traffic logs.
    You can find them at:
    http://www.labnol.org/software/kindle-user-agent-string/20378/

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