Why COVID-19 is the best and worst thing to happen to Amazon
COVID-19 has disrupted the entire world. From lockdowns to social distancing, the pandemic continues to affect more people with each day. However, communities aren’t the only things the coronavirus is affecting. Amazon has become a central focus during this time of crisis.
Amazon has historically faced praise and backlash. Whether it’s for environmental contributions or treatment of employees, Amazon and its CEO, Jeff Bezos, have found themselves at the center of many conversations. Now, with COVID-19 affecting the way businesses operate, the online conglomerate is a resource for people to continue living as normally as possible. Still, with the intense pressure already surrounding the company’s employee treatment, the virus is adding more criticism.
With a dependency on e-commerce, Amazon will remain on top of online shopping — a reliance that will increase during the pandemic. Conversely, the organization may take a hit from the scrutiny surrounding their handling of employees. Either way, COVID-19 is both aiding and hurting the brand’s image.
Amazon Attempts Positive Outcomes
During this global outbreak, Amazon can demonstrate its commitment to customers, employees, and fighting the virus. From increasing workers’ pay to donating to charity, the company hasn’t shied away from taking action.
With employees, Amazon has committed to increasing hourly wages by $2 in the United States, Canada and most of the EU. They’ve also doubled the base salary for overtime work and gave full pay and time off to employees who contract the virus. Additionally, the organization added around 100,000 job openings due to the increase in e-commerce demand. This expansion will help those who need work but also require social distancing.
Similarly, Amazon and Jeff Bezos have donated various amounts to different small businesses, schools and organizations to aid resources during the pandemic. This attempt at public relations is necessary after the brand faced significant amounts of backlash surrounding the company’s contribution to greenhouse gases.
During this outbreak, governments across the globe have enforced isolation, quarantines and social distancing. As a result, people are unable to go to stores or find certain products. While grocery stores remain open in some locations, people are afraid to go out. In this situation, Amazon is thriving.
Amazon Fresh, the company’s food delivery service, is assisting many people during this time. Consumers are ordering more food online so that they don’t come in contact with anyone. The company is also offering no-contact delivery, where you don’t need to interact with anyone else during the drop-off.
Elsewhere, the organization is fighting price-gouging — where sellers try to markup prices on high-priority items like medical supplies or sanitary products.
Is Amazon Worsening the Situation?
While Amazon is taking action that will help its brand throughout the pandemic, other factors are weighing it down. Most notably, employee strikes have been a recurring event in recent years. Now, with COVID-19 and Amazon’s prior history of wrongful conduct in the workplace, consumers and employee reactions are becoming more critical.
Christian Smalls, a former Amazon employee, organized a strike recently where he and other workers staged a “sick-out.” Employees state that the company is not providing them with sufficient materials to keep them safe — things like masks, disinfectant products and medical supplies. Amazon later fired Smalls after the incident, claiming he was violating social distancing rules.
And, since critics of Amazon expect the company to make proper arrangements for maintaining employees’ safety during this outbreak. This could lead to more automation in warehouses instead of human employees as social distancing and quarantining becoming crucial.
Another issue is Amazon’s attempt to prioritize high-demand products like medical supplies and household necessities. While this decision is helping in some areas, it’s also negatively impacting third-party sellers who use the organization’s shipping service. If they don’t sell the right items, these sellers will lose revenue or go out of business.
The Future of Amazon Amid the Coronavirus Outbreak
During initial news of the COVID-19 outbreak, Amazon stock plummeted to a low of $1,676, with investors fearing the brand would see destruction. Soon, however, people realized the situation led to an increase in online shopping. With investors now flocking to the technology stock, it has logged a bigger gain in the past few weeks than peers like Alphabet, Facebook and Apple.
People are going to have varying opinions, but Amazon will remain a central resource during this time. The coronavirus is affecting the organization in both good and bad ways. Still, the future is unpredictable.