Yet for all the futuristic predictions that all shopping would eventually be done from computers in the comfort of one's own home, Amazon CEO Jeff Bezos never wrote off the role of offline storefronts. In fact, he did the opposite, at one point suggesting that his company loved the idea of a physical storefront and would consider exploring the possibility if it could come up with a "truly differentiated experience."
"The people who operate physical retail stores are very good at it," he said in an interview with Charlie Rose in 2012. "The question we would always have before we would embark on such a thing is what's the idea, what would we do that would be different?"
On Thursday, the Wall Street Journal reported that Amazon will soon realize Bezos' dream of a brick-and-mortar location as the company is set to unveil its first location in Midtown Manhattan. Despite the obvious irony of an internet company involving itself in the game of offline retail, the central question still remains: what will be different?
While the Journal's report suggested that the new store at 7 West 34th Street could deal with same-day delivery, pickups, returns and even serve as a potential showroom for Amazon's new gadgets, Forrester analyst Sucharita Mulpuru couldn't see the exact purpose. Opening up a store in the middle of New York City to operate as a pseudo distribution center would be a costly experiment, she says, and wouldn't achieve much the company can't already do in its online-only capacity.
"Amazon's value proposition is its huge selection and shipping that comes to me," she says. "Both those aren’t going to happen at a physical store in Manhattan."
But what about its potential to serve as a touchpoint for Kindles and the Fire Phone?
"They’re not known for being the most visually creative people," added Mulpuru. "They’re not like Steve Jobs."
Amazon spokesperson Kelly Cheeseman did not confirm any details on a possible storefront, only stating that the company has "made no announcements about a location in Manhattan."
Author and retail consultant Robin Lewis first predicted Amazon would open offline stores in 2008 and says that the company has been strategizing this move for years. While he sees the Manhattan store as a litmus test for the Seattle retailer, he's already predicted success for the yet-to-be launched program and expects the company to aggressively roll out what he calls "stores-slash-distribution centers" in the next five years.
For Lewis, the move toward offline is more "synergistic" than cannibalistic, as Amazon will be able to glean more on the customer's preferences and tastes. "Amazon has a database bigger than the Pentagon and they know how to use it," he says. "They know what Suzy Jones in the Northwest corner of Iowa with two kids is eating for breakfast and those stores will be narrowly assorted for consumer preferences in that particular area."
Still for a company already skimping on margins, costly storefronts may be the last thing that investors want to see. In a note to investors S&P questioned the move of "committing potentially sizable resources to expand physical retail locations, amid looming competition from the likes of Alibaba."
Mulpuru agreed. While Amazon's fundamental value and higher trading multiples come from its label as a technology firm, the move to open a brick-and-mortar store is seemingly a step backward from the innovation that should be associated with the company.
"Their valuation is hinged on it being a tech company with this huge retail platform that they can leverage in different ways," she says. "This is opposite of that. This is old school retail."
Follow me on Twitter at @RMac18 or email me at rmac@forbes.com.
