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What are the margins on Amazon's retail revenue after all logistics costs versus the margins on Google's advertising? I'm going to take a guess and say retail
by MuffinFlavored 4y ago
What are the margins on Amazon's retail revenue after all logistics costs versus the margins on Google's advertising?
I'm going to take a guess and say retail probably breaks even (almost by design by Amazon but not sure if it'll ever be more than a 10-20% margin business because by design they are offering traditionally expensive services like fast shipping, very lenient returns at very low cost/price to the end user) whereas advertising is probably... 80% margin?
I know there are server costs, engineers to maintain them, but if Google stopped investing in growth as far as diversifying/expanding advertising services goes engineer/developer/management wise... how lean could they run?
Could they support Google's current ad offerings with a core team of... 1000 engineers? 500? 200?
- bushbaba 4y agoAmazon doesn't want to show profit in retail. It instead re-invents much of the profit into their logistics and technology. Buying all those 747s for prime air these past few years wasn't cheap. Amazon go wasn't cheap. Alexa sure ain't cheap. That all comes out of the margin of retail. Amazon retail isn't just getting revenue from e-commerce sales. There's multiple diversified business units part of that division. For example people pay for amazon logistics, amazon warehousing, etc.