Amazon is planning a complete overtake of the household consumables market

Folks Amazon is planning a complete overhaul and overtake of the household consumables market. Amazon has been planning this for years.

A key challenge for Amazon is to convince a critical mass of the public to change their buying habits.

A recent patent reveals how Amazon plans to overcome this challenge and at the same time disrupt this market for good.

Currently, consumers do not have access to information about source and history of the specific items that they purchase. For instance, a food product may be marketed as organic, but there is no way for consumers to be assured that the specific products they are purchasing have not been adulterated or have come from an acceptable source. (Baby formula from Jessica Alba’s Honest Co. isn’t really organic).

Universal product codes (UPC) only identify the item generally, not a specific instance of the item.

So there is an increasing demand by consumers for complete information about the products that they purchase. The farm-to-table movement has raised consumer awareness about the ultimate source of food that they consume. Locally grown food products are becoming more desirable than products sourced from far away. Chickens raised by Joe Smith in the next town may be more desirable than chicken of unknown origin sourced from a multi-national chicken corporation. Further, free-range livestock that are fed natural foods may be more desirable than cage-raised livestock that are fed a processed food.

Consumers are also sensitive about environmentally sustainable agriculture. In fact, these issues relating to consumer preferences apply not only to food items, but to other categories such as apparel as well.

Amazon’s strategy is to cater to this need of the marketplace. Amazon has developed systems to give complete information about the source and the history of each specific item.

According to the patent, Amazon plans to use of a pair of public and private identifiers for each specific instance of an item (e.g., a single box of cereal). A multi-layer label includes a unique public identifier on an upper layer and a unique private identifier on a lower layer. While the item is being manufactured, warehoused, and transported, only the upper layer bearing the public identifier is visible. The public identifier is scanned at various steps, thereby creating a history record uniquely associated to the item. The history gets automatically recorded on the cloud. Upon arrival, the consumer removes the upper layer of the label in order to expose the private identifier on the lower layer of the label. The consumer then scans the private identifier using Amazon app. The app then displays the complete history of the item.

This item-level tracking will enable Amazon to manage various operational processes for the items. In particular, item-specific expirations may be monitored, and recalls of specific items may be performed.

This is great. But there is one big missing piece here.

How will Amazon acquire history information of products supplied by third party vendors? In other words, how will it guarantee that the information shared by the vendors is correct?

The answer is private-labels.

In coming weeks, Amazon is planning to ‘carpet-bomb’ the market with new private brands. The new brands will have names like Happy Belly (for food stuffs including nuts, trail mix, tea and cooking oil), Wickedly Prime (snack foods) and Mama Bear (for baby products like diapers, baby-food jars and gentle detergent). With complete control over the production and delivery of products, Amazon can assure its customers that the information is correct

But amazon can do more…

Amazon is building drone technology to deliver goods. It is totally possible that in near future, you might be able to order products directly from a specific farm near your home via Amazon. If you think about it, that would be the real – Farm to the table.

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