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> If Amazon wanted to start pushing more into local markets (or different kinds of products), they can make a fortune off this data, and that's why they can aff
by greghinch 12y ago
> If Amazon wanted to start pushing more into local markets (or different kinds of products), they can make a fortune off this data, and that's why they can afford to undercut companies like Square. It's a long term play.
Possibly. Alternatively, Amazon seems to operate under a business model something like: 1) enter an existing market with a product offering that is at best the same as the competition 2) undercut said competition with unsustainable pricing until you drive them all out and have a monopoly 3) raise prices, profit
- icebraining 12y agoDoes it? In what market have they done (3)?
- abecedarius 12y agoThey're raising prices on Amazon Prime (and bundling more things I don't want into it, Microsoft-style).
- icebraining 12y agoIn what market does Amazon Prime compete?
- judk 12y agoShipping.
- icebraining 12y agoMore like the "shipping of amazon products" market, since I can't exactly ship my stuff with Prime. And I'm pretty sure Amazon was always the only provider in that particular market, so they didn't really do (1).
- potatolicious 12y agoThey haven't really reached (2) in any market besides books. As dominant as Amazon is, Wal-Mart still towers over them for just about every product category that isn't printed on paper. I'd argue (3) shouldn't read raise prices - that isn't really Amazon's MO, (3) should read "leverage their de facto monopoly to squeeze suppliers for all they've got, Wal-Mart style". This is certainly happening in books.
- bkeroack 12y agoThat isn't a new strategy. Starbucks did it all throughout the 1990s, opening locations sometimes literally on every block of major cities, many of them money-losing. They waited for the existing coffee shops to be driven out of business and then thinned out their locations to a more sustainable density.