Amazon.com Inc.’s hot holiday seller, the Echo speaker, is nearly sold out—except in Amazon’s brick-and-mortar stores.
On Amazon’s main website, the Echo and smaller Echo Dot devices—powered by artificial intelligence that allows customers to ask questions, control smart home devices, play music and order on Amazon—aren’t in stock until after Christmas.
However, because of a quirk in Amazon’s increasingly complex supply chain, the speakers were still on shelves as of Monday at its three brick-and-mortar bookstores, with additional chances to snag the devices at its roughly 30 pop-up store locations at malls.
Amazon.com is seen as a one-stop shop, giving consumers the ability to access millions of goods no matter their location. The spotty stock of Echo devices shows that isn’t always the case as Amazon experiments with new ways of selling goods to consumers.
“Due to demand, we encourage customers to purchase an Echo if they see it available,” said an Amazon spokeswoman.
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Last week, Jennifer Van Grove, a reporter in San Diego, wanted to buy her mom an Echo for Christmas. However, it was sold out online.
The 35-year-old thought to check Amazon’s brick-and-mortar bookstore. “I just went there right when it opened, and they actually had plenty in stock,” she said, noting they were discounted 22% to $139.99, the same price as online. She bought one on the spot.
The different ways to buy goods via Amazon is bringing it more in line with the way traditional retail has typically worked, where a hot-selling item may be available in some stores, but sold out in others.
Last week, after the Echo was sold out on the main site, it was still available in some of the more than 30 U.S. cities served by Prime Now, the company’s one-to-two hour delivery service for participants in Amazon’s annual $99 membership program. By Monday, the device appeared to be sold out there, too.
Demand for the Echo speakers has likely been higher than what the company forecast, supply-chain experts say, stoked by lower pricing. On Thanksgiving and the big shopping days following, Amazon said the smaller Echo Dot was the top-selling device on its website. The company has lowered the price on that device 20% to $39.99.
More than five million Echo devices were sold through the end of the third quarter, with likely millions more sold since Black Friday, estimates securities research firm Consumer Intelligence Research Partners, or CIRP. Amazon says it has sold millions of the devices.
The Echo isn’t the only hot product vanishing before Christmas. Other tech products, such as Apple Inc.’s AirPods, Nintendo Co.’s NES Classic and Pokémon Go Plus and Sony Corp.’s PlayStation VR headset, were scarce, including on Amazon.
Some products were limited runs to create buzz, experts say. In other cases, such as with certain models of Alphabet Inc.’s new Google Pixel phone, the lack of availability may have resulted from manufacturers and retailers failing to account for strong consumer demand.
“Companies are trying to keep their inventory low, because they don’t want to get stuck with a lot of excess inventory,” said John Haber, chief executive of supply-chain consultancy Spend Management Experts. Retailers this year trimmed inventory after a glut last year, which may explain some of the trend.
Amazon stocks its merchandise in 149 warehouses around the world—26 of which were built this year alone—and many of which carry millions of items that are available at the click of a button on its main website.
Some of those are smaller local hubs for goods sold through Prime Now, which has different inventory available at each. Amazon’s physical bookstores, which it began testing last year, also have their own stock.
Amazon’s Echo, released in late 2014, has been a big hit, giving the online retailer a head start in an arms race against competitors including Google and Apple. The cheaper, smaller Echo Dot was introduced earlier this year, making this the device’s first holiday season.
The Echo and Dot are still listed at their discounted prices online, even though they’re not currently available—a sign that Amazon hopes the high demand will continue past the holidays, says Michael Levin of CIRP.
“Amazon sees this as an opportunity to start getting presence in people’s homes,” he said, even if inventory runs out in some channels. “This is a land grab.”
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