4 ms·
"I have no idea how Amazon made any money on my order (the whole bill was less than $30) but several people on Twitter told me that they’ve experienced similarl
by dr_ 14y ago
"I have no idea how Amazon made any money on my order (the whole bill was less than $30) but several people on Twitter told me that they’ve experienced similarly delightful service."
Therein lies the problem. At some point there will have to be revenues to justify the company's valuation. I suppose their goal is to initially obliterate all competition in entirety and then have everyone purchase from Amazon. I'm doubtful this will work. Of late, there has been a trend towards experience stores - with manufacturers creating their own stores instead of distributing to retailers. Many luxury brands do this and even some non-luxe ones, such as Samsonite, have been getting into the game. There's some value added here, and it's something Amazon won't be able to directly compete with.
- notatoad 14y agoI think you might be underestimating amazon's position. They already have massive revenues, and better mindshare than most of the brands they sell. They aren't some new startup, they bring in millions of dollars a day and are historically proven to be a successful company. Your post would make sense if amazon were a year old. They aren't. They've been doing this for a long time now and are very very good at it.
- sureshv 14y agoQ1 2012 Amazon had $13B in revenue and basically broke even, Costco had $23B in revenue, and Walmart has $113B. Where are you getting your financials from?
- jrabone 14y agoAnd Amazon's revenue is growing 33% YoY. Costco is 8%. Wallmart is 8.5%. See where this is going?
- sureshv 14y agoWhile making very little profit; that's not infinitely sustainable in retail where margins approach nothing. Amazon 2012 profit was $650M, Costco $1.4B, and Walmart $16B. If Walmart decided to go zero profit they could drive out a lot of competition and get a visit from the DOJ...
- ippisl 14y agoAmazon has a great story to tell the DOJ:we've not reduced our prices, we're working on offering better service: prime service is expensive, and we're building costly warehouses and bought a robotics company, and investing in pack-stasions.