Online shopping without an online shop: Amazon establishes the dash button in Germany
Since August 31, Amazon has been offering its Dash Buttons for the first time in Germany, which have already been successfully launched in the USA. The order buttons, which are exclusively available for Prime members, are connected to Wi-Fi and enable consumers to order products for their daily use such as detergents and cleaning agents, cosmetics or animal feed at the push of a button from home. Each button represents a specific brand and is linked to a pre-selected product. So far, the buttons have been available for about 30 brands, including Ariel, Gillette, Schwarzkopf and Whiskas.
Order at the touch of a button – How it works
The order buttons can easily be purchased via Amazon for 4.99€, which will be credited with the first purchase via the button.
Each dash button is powered by a battery and must be connected to Wi-Fi before it can be used for the first time, and then configured using Amazon’s smartphone app. To do this, Prime members must simply link the app to their customer account and then select the product once, which is to be reordered later at the push of a button.
Once the button is pressed, delivery will be made the next day as usual. No computer, tablet or smartphone is required for the entire ordering process.
Amazon also prevents children from playing or accidental double pressing: Only one order can be placed per Dash button until this order has been delivered. In addition, the user will be notified immediately after placing an order via his or her smartphone where the order can be checked, changed or cancelled free of charge.
Development towards fully automatic delivery
In addition to the conventional button-press version, Amazon has also implemented the automated version of the service, the so-called Dash Replenishment Service (DRS) in Germany. This allows manufacturers to upgrade their equipment in such a way that they can automatically reorder items when required by measuring product consumption independently. For example, a washing machine can order new detergents if it needs to be replenished.
While Amazon’s dash order buttons provide a significant increase in convenience for the user, they are also an important step towards fully automated delivery for Amazon as the world’s largest online retailer.
Trailblazers in the American market
Amazon customers in the USA have been able to purchase order buttons from more than 100 different brands since spring 2015. According to Amazon Manager Amir Pelleg, orders for Dash Buttons have tripled in the last two months in the US, currently about two orders per minute. Household articles made of paper, detergents and beverages are among the most frequently ordered goods in the US. According to Pelleg, the brands had urged Amazon to expand the Dash Buttons faster internationally.
Since Germany is considered Amazon’s most important foreign market with a sales share of 11 percent, it is not surprising that Germany is one of the first foreign markets in which Amazon Dash is being tested out.
Dash button and its lack of price transparency
However, with the rapid growth of the innovative dash buttons, criticism is growing. The lack of price transparency is particularly criticized. As the dash buttons have no display, customers order their items without any price overview. In fact, notification via the smartphone after a successful order is the first time the customer learns how much he or she has to pay for the purchased item. “Every time the customer is surprised by the price, this is a huge problem for us,” says Pelleg. It’s about trust that is easy to lose.
Due to the branding of the dash buttons, consumers are also not able to compare prices and products or to obtain opinions from other customers. In addition, there are the disadvantages for retailers when customers order fast-moving consumer goods (FMCG) by dash button instead of buying them at the supermarket.
Opportunities for manufacturers
Even though Amazon makes online shopping a lot easier for its customers with the help of the order buttons, it can be assumed that the American shipping giant is not acting out of charity.
Instead, Amazon can use the Dash Button to conquer the home’s four walls. Despite the fact that the Dash has not yet made it to the mass market in the US, the Amazon order button is already a very powerful tool, especially in terms of customer loyalty to the respective manufacturer. After all, once a consumer has chosen a Dash Button, they will, at least temporarily, choose and buy exclusively from its brand range without taking the competition into account.
In addition, Dash enables dealers to make direct customer contact without the need for third parties such as search engines, social networks or hardware.
Manufacturers only have to decide to join Amazon’s Dash Button Service. Amazon takes care of order processing, customer service and the necessary infrastructure.
Whether the implementation of the Dash Button is economical and will pay off for Amazon in the future remains questionable, especially in view of the delivery costs. The mail-order giant does not want to publish current figures. However, it is clear that selective orders also increase the number of individual product deliveries. According to Amazon manager Amir Pelleg, however, it is “the task of the company to make delivery more efficient”.