How Amazon’s Dragon Boat Could Disrupt The Digital Signage Eco-System
February 17, 2016 by Dave Haynes
Online shopping giant Amazon is reportedly planning to build out a global e-commerce and supply-chain network that would – among many, many things – make buying digital signage hardware from China about as easy as ordering consumer items.
That matters in the context of the signage eco-system because right now the main option for buying things like display mounts from China is the direct-sale online marketplace Alibaba. The vast site is a business directory listing endless products, however buying any of those products is anything but the one-click experience of Amazon.
You contact the supplier, who may actually be a middleman. You negotiate price and minimum order quantities. Shipping needs to get sorted. You hope what you order is what shows up, and is not made from dodgy components or held together with tape. And on and on. Most people would be enticed by the price, but turned off by the process and risk.
With what Bloomberg News is reported as Dragon Boat, Amazon “would bring goods to America directly from Asian merchants and factories via Amazon-deployed trucks, planes and ships, and would provide loans, international payment processing, and customs and tax consultation online and through mobile devices.”
The result, the report says, will be a “one-click-ship for seamless international trade and shipping. … The ease and transparency of this disintermediation will be revolutionary, and sellers will flock to [Fulfillment By Amazon] given the competitive pricing.”
A person familiar with the initiative told Bloomberg that Amazon is proceeding with the plan, which was presented to senior management in 2013. The timetable calls for the launch of the new logistics operation, Global Supply Chain by Amazon, as early as this year, and word from cargo-industry execs that Amazon is looking to lease its own fleet of Boeing 767s would appear to support it.
An industry friend I was chatting with at ISE last week asked me if I had heard about the Amazon initiative, after I asked him a question about selling against low-cost Chinese products. Dragon Boat, he said, could become a big problem because most of the barriers that make buying from China would be lowered or gone.
The experienced and smart people who do digital signage projects as their primary business know the challenges and flat-out risks of using offshore stuff. You just don’t know what’s going to show up in the shipping boxes, and most don’t even go there.
But there are lots of local installers and solutions providers who want or need to shave costs who would be all over buying stuff from China, and have no experience or understanding of how a cheap monitor might blink out, a device might overheat or catch fire, a mount sag or fall apart from metal fatigue, and so on and so on.
So Dragon Boat would potentially bring over at least a couple of things:
1 – Repeated responses from under-educated buyers saying, “$750??? I can get that off Amazon, from China, for $175.” Even though “that” is anything but identical.
2 – The likelihood of more shoddy projects and dead screens, and the real risk of things like monitors falling off mounts and causing damage or injuries.
A lot of what we all now spec and buy in signage comes, in some way, from China and other offshore countries with lower manufacturing (read wages) costs. And much of it is of the highest quality, because it is done to spec or consolidated and optimized. So Made In China, or Vietnam, or whatever, does not mean it’s junk.
The risk of things like Dragon Boat is the stuff that’s cloned or cranked out at low cost with the same mindset as T-shirts we buy, understanding they’re pretty much throwaway quality.
On the other hand, I doubt Amazon has much interest in selling and shipping crap that’s going to generate endless returns and complaints and erode the company’s reputation. So maybe they carefully select and police the hell out of supplier/manufacturers.
Dragon Boat has not been announced, and maybe it won’t ever sail, but it could prove a real problem for a lot of established manufacturers of the things that stitch signage networks together.