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Lock-down, Christmas and e-commerce: is Europe really destined to become Amazon’s warehouse worker?

Andrea Di Camillo, Managing Partner at P101 | December 23rd, 2020

The strict lockdown that Italy experienced in the spring was Aamzon’s “picklock” to reach the countries and homes where it had not yet arrived. In fact, people who had never shopped online began to knock at the door of Bezos’ store: “shopping Luddites”, non-digital natives, housewives (and househusbands).

In the marvellous article “Pasta, wine and inflatable pools“, published a couple of months ago by the New York Times, we can read that it was, in fact, starting from the spring of 2020 that all of a sudden we began to see Amazon trucks sneaking on an everyday basis into the suburbs of towns like Avellino, or climbing up the narrow streets of villages such as Calitri (geographically in the same area of Avellino), which are inhabited by just a few thousand souls. It’s around the same time that the percentage of Italian people who shopped online went up from 40% to 75% of the population.

Besides, the “second wave” of anti-Covid rules that we have just experienced, with its “alternating colours”, and the rush to Christmas consumerism in the last few weeks, are once and for all showing that in Italy, too, the game of commerce is definitely being played online.

So, if the first lock-down has legitimised the use of e-commerce even amongst the most sceptical socio-demographic groups – rewarding companies that had geared up for this, and penalizing commercial real estate to the point of bringing it to its knees –, now the game is moving to the next level.

In just a few months, Amazon and Alibaba have become competitors of local grocery stores.

A potential European and Italian response to Amazon-Alibaba

In this scenario, can Europe and Italy work together and try not to become the “warehouse workers” of these online giants?

Europe has all the cultural and tech tools to play this game and try at least to tie the match. Surprisingly, in this match Italy can aim for a leading role thanks to a number of competitive advantages: expertise in the subject of supply chains (the food and fashion ones, in particular), brand recognizability (ditto), infrastructures that are more efficient than you would imagine (for instance, this year Poste Italiane has acquired Milkman’s technology to implement its goods delivery service), and a group of young, lean, promising companies that are working on services that make the shopping experience increasingly seamless – let’s just think of Satispay and its international investors.

Italy holds a number of records. Now, it is up to the capital market, to institutions, and to large corporates to make the most of the investments that venture capital funds (but not just them) made on the promising but still small companies of Italian e-commerce. In this way they can take advantage of the shift in the shopping habits of people – a shift that will strengthen and grow in the coming months.

The recent leap of retail and business consumers towards more efficient services, 24/7 availability, wider choice, and better product comparison, is becoming a new standard for them, one from which there will be no turning back.

The great advantage of Italy: local brands and supply chains

We need to focus our excellent production, from food to fashion to mechanics. We need to create “districts 4.0” that trace the traditional Italian production model and carry it to the future. Indeed, we can give life to an alternative way to Amazon, by relying on our expertise about supply chains, on the international fame of our brands, on our ability to connect advanced infrastructures to digital start-ups – whose business models are usually based on the creation of “enabling tools” such as e-commerce. The partnership between Tannico and Campari that was announced last spring was just a timid beginning of Italy’s journey in this direction.

We can create a fertile ground, made of new entrepreneurship, new wealth, and new culture. Not only with the aim of raising Italian GDP or tax revenues, but also in order to nurture deep know-how and expertise, which are the basis of any country’s ability to innovate and to reach markets that, as we’re witnessing, will be increasingly competitive.