AWS Outage Posed Significant Challenge for the Retail Industry

While its systems are back online, yesterday's massive Amazon Web Services (AWS) cloud services outage brought down thousands of high-profile apps, websites and online platforms with it. The outage on Monday prevented consumers from making purchases on certain apps and websites whose e-commerce platforms, backend infrastructure, or customer-facing tools rely heavily on AWS. For example, retailers whose checkout, inventory, or transaction systems are hosted on AWS faced downtime, slowed performance or the inability to process orders during the outage. That led to abandoned carts and lost revenue. Mehdi Daoudi, CEO of internet performance monitoring firm Catchpoint, estimates the total financial impact of the AWS service disruption will be in the billions of dollars.

Total Retail's Take: In addition to the lost sales cited above, the AWS outage had other negative consequences for many retailers. Those include an erosion of brand trust, with consumer perception of unreliability, fairly or unfairly, leading to reduced revisit rates, loyalty, and conversion in subsequent visits. Furthermore, consumer-facing e-commerce storefronts are just one area upon which retailers rely on cloud services from AWS. The outage impacted inventory data, warehouse systems, fulfillment APIs, and other internal operating systems, with that disruption being felt in supply chain (e.g., fulfillment delays), customer service, and IT functions. Following the AWS outage, retailers would be wise to evaluate multi-cloud or redundant architectures to mitigate cloud risk from a single provider.