Three years after the launch of Amazon Home Services, the online giant has made new moves into cracking the $16 billion homecare industry. The end of March saw Amazon quietly hire a fleet of housekeepers in their local Seattle, to test run the latest iteration of their foray into home services – Amazon Home Assistants.
The move marks a break from Amazon’s previous, contractor-driven models that aimed to match buyers with housekeepers and handymen in their area. So why retreat to a more traditional platform for housekeeping jobs? There are many reasons why Amazon, and companies like them, could be turning away from relying on independent contractors – reasons that are more mutually beneficial than you might think.
Since its launch in 2015, Amazon Home Services has not performed as well as the company hoped it would. The service has widely flown under the radar for most Amazon users, with projects like Amazon Go receiving far more media attention.
At the time of its implementation, Amazon Home Services operated much in the same way that platforms like Uber do. Independent contractors could connect with potential clients over the platform, with Amazon taking a small cut of their earnings in return. This cut was Amazon’s only real involvement between contractor and buyer, as contractors were not obligated to complete any training or in-depth screening conducted by Amazon.
On the surface this seemed like it would increase Amazon’s profit margins, as contractors would buy and use their own tools and supplies. It almost seems counter-intuitive for Amazon to now start hiring housekeepers directly and supplying them with tools of the trade, but there’s more to their decision than just profit.
In many ways, the Home Assistants experiment could be a positive change for those working as housekeepers. They’ll be provided with training and supplies by Amazon, and will be entitled to a minimum wage and benefits – something they wouldn’t receive as independent contractors.
It’s a clever move for Amazon too, who have evidently picked up on the shift in public opinion towards the safety of hiring contractors online. Though many have been persuaded by the cost and convenience of platforms like Uber, they’re certainly not without risk. A series of crimes committed by contractors have understandably attracted a lot of media attention, and contributed to a growing sense of unease surrounding the gig economy. The safety of service platforms is a hot-button issue, and one that Amazon is deeply concerned about.
Last year Amazon announced their Amazon Key and in-home delivery options, and were greeted with a degree of uncertainty from users and commentators alike. Understandably, customers weren’t immediately thrilled at the prospect of giving strangers access to their homes, even if those strangers were delivering their online orders. It’s this sense of suspicion and unease that’s proving to be an obstacle for Amazon in their attempts to further place themselves in the homes of their users.
In this regard, Home Assistants could prove an invaluable asset in reassuring a nervous customer base. Housekeeping is the ideal market for Amazon to set their sights on, as its one of the few existing industries where customers are comfortable allowing workers into their homes unsupervised. By hiring their housekeeping staff directly and training them to an agreed-upon standard, Amazon is is doing more than branching out their services – they’re proving their trustworthiness to their customers. It could just be that Amazon’s Home Assistants will open the door for more in-home services provided by the company, and it wouldn’t be surprising if others followed suit.
If Amazon’s experiments are indicative of a new trend in the market, the implications for independent workers could be huge. Though the flexibility and accessibility of the gig economy have been positive for independent workers, the system is not without its faults. Aside from the often poorly-regulated nature of the hiring process, workers themselves are not entitled to a living wage or benefits. They’re often untrained and underpaid, struggling to keep their individual ratings up in a saturated market where numbers mean everything. A return to more traditional employment structures could provide many workers with a stability they’ve been lacking in their current gigs.
Though it’s certainly early days and only time will tell how the initial Seattle experiment fares, it’s not unreasonable to imagine that other companies will take notice of Amazon’s strategies and follow their example. Given the mounting cases of contractors gone awry, and the increasingly bad PR of gig platforms, something eventually has to give. Maybe it’s time companies went back to basics.
On the surface it’s a trial run of a service that Amazon has been trying to push for three years, but its success has the potential to change a growing niche of the labor market and set the stage for a new era of how we engage with online businesses; an era where businesses have trusted access to our homes.