Jim Lyons Observations: Amazon Introduces Dash Replenishment Service for Printer Supplies

by Jim Lyons | 1/28/16

During mid-January this year, my attention was captured by a Quartz article titled “Amazon is selling gadgets that can order their own refills.” The story, published the same day as Amazon’s official announcement, features a use case based on a printer owner running out of ink at 3 a.m. when a desperate need arises to print a single page from the printer. This situation could have been avoided had the hapless user had a Brother printer registered in the Amazon Dash Replenishment program, as the printer would have preemptively taken on the job of ordering supplies soon to be in need of replacement, leading to a happy ending with that much-needed page pleasingly printed.

The Amazon Dash Replenishment Service builds on the Dash Button program, launched about a year ago and featuring product categories like cleaning supplies and sports drinks. Amazon has upped the level of automation and added supplies-consuming machines like printers and automated pet feeders, and household appliances like washing machines and coffee makers that are Internet-connected and “smart” enough to do the ordering “by themselves.” And despite the focus on Brother in the release and some of the accompanying press, Samsung laser printers are also shown as part of the program, and with open APIs, one can expect more to follow.

Déjà vu

 I got a strong feeling of déjà vu from this story, and the more I thought about it, it was actually multiple cases of feeling “we’ve been here before.” One instance linked in my mind to the “drone discussion” and an appearance by Amazon CEO and founder Jeff Bezos on 60 Minutes two years ago, which immediately resulted in tons of press (and speculation by some in the printing and imaging industry that ink cartridges might be an ideal drone-delivery candidate – talk about desperate to get a page printed!) Amazon Drones arise as a topic to this day (with the company occasionally feeding the flames), proving the real value of it, in my mind, was in its PR value, or what we call in the marketing field “earned media.” I made a comparison then to the Apple “1984” commercial, as both stories were seemingly irresistible for both the business and general press. Amazon’s Dash Button last year (a bit reminiscent of the Easy Button from Staples) and now the auto-replenishment angle also hit it big with that broader base of media, going far beyond the tech world – though considerably less sexy and futuristic than the drones.

A much more chronologically distant association but one I remember quite well, came from my time working for HP and leading a team looking at the newly emerging Internet, going back 20 years and more, when one of the first ideas to come out of brainstorming on the possible benefits of the Internet on printers was that we could someday have networked-connected printers that could sense supply capacities and then order their own.  In my original coverage of HP’s Instant Ink program, I also ran with the idea that their automated ink-fulfillment program was something of a “proof point” for the Internet of Things – a somewhat loftier subject (if not more practical and potentially profitable) than Amazon’s ever-improving logistics system.

A Third-Party Perspective

Speaking of Instant Ink, I wanted to get another industry person’s view on the practicality of all this from Amazon, and some comparison to other programs so I pinged friend and well-known industry observer Larry Jamieson — who, it turns out, is also a current HP Instant Ink customer. Here’s what he had to say on the subject:

“I got Instant Ink because I really did know how much I printed and how much replacement cartridges are. While many consumers complain about the cost and frequency of purchase of ink cartridges, it isn’t that critical in their lives. Printers are not high on the list of important items in their lives, especially with electronic documents becoming more commonplace. For consumers and small businesses to buy into these programs, they must reach a new level of trust with the provider. It’s one thing to buy a printer and cartridges on a periodic basis, but to share information and allow the supplier to track usage is pretty open. 

“The other factor is that the suppliers may tell consumers that the automatic replenishment system will save them money and aggravation from running out of ink at inopportune times, but the consumers essentially have to do the math to figure out that this service really does provide them benefits and isn’t just a plan to extract more money from consumers’ pockets.

“I don’t know much about the Amazon system. Can it be used to replenish with third party cartridges or refills? In HP’s case, it essentially locks the consumers in to HP cartridges, but at a cost that is close to third-party providers. Why would people buy third-party ink or toner if there is very little price difference and consumers are getting OEM reliability? With the Amazon solution, other than getting timely delivery, are there cost benefits for the cartridge costs? 

“In both HP and Amazon’s cases, the biggest problem is getting the consumers’ attention. Right now, consumers need to look specifically for these solutions to buy in, and with printing generally on the decline, it might be an uphill battle.”

In Conclusion

Jamieson’s question on brand-name versus alternative supplies is a good one, with price-sensitivity and supplies an ever-growing consumer concern, and  looks like an invitation to an upcoming follow-up post with a perspective directly from HP. And to throw in a question (really an area of questions) of my own, and speaking of consumers, the Amazon is an end-user play at least at its beginning, but how are small businesses and even enterprises envisioned to play in the same or similar programs? Much of the value proposition of both Amazon and HP programs can be traced to a more automated, hands-off approach brought into the mix by managed print services, working its way down-market. How will these new activities work their way up-market?

Jim Lyons has been writing, analyzing and blogging about industry developments since 2006. In his monthly Observations column he comments on business and marketing developments in the printing and imaging industry, combining many years of experience with an ever-enthusiastic eye on the future. In the Jim Lyons Observations column on The Imaging Channel, highlights from that blog appear monthly. Lyons is also a faculty member at the University of Phoenix, teaching marketing and economics at its school of business, and is a regular contributor to both The Imaging Channel and Workflow. Follow him on Twitter @jflyons and read more of Jim Lyons Observations at http://www.jimlyonsobservations.com/.