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The article doesn't go into the most important advantage Amazon has: it has data on what sells well and what markets it should enter using existing brands on it
by ctvo 8y ago
The article doesn't go into the most important advantage Amazon has: it has data on what sells well and what markets it should enter using existing brands on its marketplace. With this data, it enters markets and undercuts its competition at the perfect price point.
- briandear 8y agoThen consumers win. The competitors can lower their prices/increase their quality/improve efficiency and consumers get to buy better products for less.
- partiallypro 8y agoAmazon often has higher prices than Walmart & Target, but people still don't shop Walmart online because Amazon is convenient. Amazon knows the perfect price point to stop people from shopping around to other online outlets, that doesn't mean it is giving the lowest price to consumers. People will, in person, buy something from Walmart instead of Kroger over $2, but Amazon has somehow figured out how to keep people on their site by properly measuring demand elasticity. Not to mention most listings on Amazon now are ads for products on Amazon. Tide, etc pay for top placements in the stores. So Amazon gets fulfillment cut and money from ad revenue. It's pretty impressive.