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Article claims that it's easy to compete with Apple, yet hard to compete with Amazon. Fair enough, makes a lot of sense to me. And yet, last I checked, a lot o

• sliverstorm 14y ago
  Your second line doesn't make sense. What does companies making money in retail have to do with being able to compete with Amazon? Now, if you could say that incumbents attacking Amazon's base stole serious revenue from Amazon that would be something. But what does it mean to say WalMart makes serious money in retail, ergo it is easy to compete against Amazon?
  • codeflo 14y ago
    I don't quite follow you either, maybe I misunderstand you. Every sale that Walmart makes is one that Amazon didn't get, right? They are direct competitors (at least for a subset of their respective product portfolio).
    • sliverstorm 14y ago
      They are direct competitors I guess I don't see it that way, but reflecting I guess my view is distorted.
  • niggler 14y ago
    How do you define "competing against Amazon"? If you define it as general retail (who manages to capture the consumer dollar), then Walmart and its physical stores can be considered a competitor. If you take the article's concept: "build a massive online database and offline infrastructure to transport boxes from warehouses to hundreds of millions of doorsteps.", then clearly stores aren't competing with Amazon.
    • potatolicious 14y ago
      I actually think brick and mortar stores are competing with Amazon - and there is also an emerging hybrid approach that threatens Amazon as well. In many places, suburbs and cities alike, people don't want stuff delivered to their doorstep. The existence of Amazon Lockers is proof enough of this - sotres now offer online shopping with local pickup (Best Buy, Staples, and IIRC Wal-Mart). This competes with Amazon. Wal-Mart is also attempting to reposition itself as an Amazon alternative (i.e., pure online shopping) and has the capital and existing supply chain infrastructure to do so (they are one of very few). On top of that Amazon continues to struggle with specialty goods. Amazon is very, very effective at selling mass-market products, but their attempts to move upmarket have been extremely mixed. Lower-volume, premium goods are not their forte, and brick and mortar stores (as well as niche online shops) still have a firm grip on that. Not to mention we know that the public is extremely price-sensitive. Amazon continues to price-compete with Wal-Mart, despite its substantially lower volume, leading to even thinner margins. They do this out of necessity, because at this point for many people the conveniences of online do not trump a quick trip to Wal-Mart if the product is cheaper. I don't think it's at all prudent to discount pure brick and mortar businesses as competitors to Amazon. Amazon very much exists in the same sphere as all retailers, online and off.
      • niggler 14y ago
        Amazon Lockers and local pickup solve different problems: the Locker solves the delivery guy issue (will I be there to sign) but doesn't provide the immediacy of in-store pickup for those items that are available in store.
  • thechut 14y ago
    This is first year business school stuff here. In a five forces analysis[1] of Amazon, Wal-Mart would certainly be a substitute, not a rival. In general it is true that Amazon has a high threat of substitutes. I think what @silverstorm, and this article, are trying to say is that rivalry for Amazon is pretty low, given how expansive their business is. [1] http://en.wikipedia.org/wiki/Porter_five_forces_analysis http://en.wikipedia.org/wiki/Porter_five_forces_analysis
  • ahoyhere 14y ago
    I recently bought a pair of pajama pants from Walmart.com and they shipped the same day. How many online retailers do that? Other than Amazon, of course. Certainly Walmart believes they are competing with Amazon. (I would have bought my patio furniture there, too, if they hadn't sold out. Instead I bought it on Target.com.)
• Frencil 14y ago
  The retail comparison is apples to oranges, in my opinion. Amazon is purely eCommerce, no brick-and-mortar, so the comparison is strongest when considering other eCommerce outfits. Consider a site like NewEgg. At ~250M annual revenue they're an appreciable fraction of Amazon's size with a lot of catalog overlap. Certainly for commodotized consumer electronics they are direct competitors. I think the difference the author is trying to articulate is that NewEgg's overlap with Amazon (for example) is considerably less impactful on Amazon than, say, Samsung's overlap with Apple. Phones and tablets are a huge proportion of Apple's profit generation - an area where they cannot afford to be dethroned. With Amazon and consumer electronics, having NewEgg overtake more of their sales in that area would hurt, but Amazon has such a vast catalog that the company, investors, and stockholders know they'll soldier on in a variety of other markets. That's Amazon's power. Apple's no one-trick pony but they are a pony with a countably limited number of tricks. Amazon is a platform for selling anything and everything. They've abstracted out their distribution network to adapt to selling the Next Big Thing before it's even been conceived. Competitors can take a swipe at a chunk of their market but at the end of the day they're in so many markets that it's a truly monumental task to dethrone Amazon in any meaningful way.
• umbrella 14y ago
  Theoretically it would be possible to compete with Apple because their price position makes them vulnerable (high margins). A competitor offering an equivalent product could undercut them and come out on top. This is textbook from an investment point of view. This was all said in the article I think but I'm just trying to rephrase it. But yes, as Microsoft demonstrates competition in this sector doesn't always go by the book. Because it really isn't such a free market with non-captive consumers.
• pvdm 14y ago
  It is tough to compete in the public relation and marketing arena. It is a soft-skill that many competitors have not master.