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Bezos Faces Season of Worsts as Losses Mount

77 points by dataminer 12y ago

IgorPartola 12y ago
Yikes. I use them both for their AWS service and as a consumer of their ecommerce side. I don't do much with their Prime programming, but I have a membership. There are a couple of areas where Amazon got worse since 2012 on the ecommerce side. First, Add-on items are annoying. Stuff I used to order and get for free now has to be bundled. I get why they are doing this, but it's just jarring. Second, their prices actually seem to be getting higher. I can often now find equivalent products cheaper locally. Tools are especially bad that way: Home Depot regularly beats them. Clothing is a crapshoot, but I generally find better sales at local stores as well. Amazon will typically have the best of breed item, while not having a basic version for a reasonable price. For example, last winter I bought winter gloves. Amazon had great ones, with good reviews, etc. but I bought a pair for 80% less that while not as good was very adequate. I checked later and Amazon did not carry this brand or much decent stuff at this price point. Search is getting worse. More products are miscategorized and you have to be very careful about what you buy. Here's a quick example, search for "GoPro". You'll get many duplicate options, often with confusing descriptions, in different departments, etc. They are still a powerhouse when it comes to online shopping, but I really wish someone gave them a kick in the ass in terms of pricing and usability.
- Zombieball 12y ago
  I was under the impression that the majority of products offered on Amazon is through third party sellers (who set the price) and Amazon is merely the fullfilment channel. However, I don't know the real split between the number of sold by Amazon vs. Fulfilled by Amazon products available.
  - desdiv 12y ago
    Third-party sales is about 39% of Amazon's units sold[0]. The actual value of third-party sales is probably a more useful and informative measure, but I can't seem to find that information anywhere. All I can find is this outdated (2008) report that vaguely says it's "around 40%"[1]. [0]http://www.forbes.com/sites/greatspeculations/2013/01/30/amazons-third-party-sellers-drive-margins-and-stock-higher/ http://www.forbes.com/sites/greatspeculations/2013/01/30/ama... [1]http://web.stanford.edu/class/ee204/Publications/Amazon-EE353-2008-1.pdf http://web.stanford.edu/class/ee204/Publications/Amazon-EE35...
- bitL 12y ago
  Median selling fee is 15% from the end price so if you run your own marketing/ads/sales, you can offer prices without this "tax". This pushes 3rd party sellers to either very low margins (especially in electronics) or higher prices on Amazon in exchange for discoverability and no need to run your own SEO/eshop/marketing etc.
  - hga 12y ago
    Amazon has something of a monopoly on trust in 3rd party sales. Lots of experience gives me great confidence in sellers with a 96% or greater rating, and willingness to pay more. Whereas my father and I have found in an iPhone purchase (an old, but still well over $100 model) that eBay can be trivially played to completely screw over the buyer. For that matter, Amazon has a 5 refunds per lifetime policy last time I checked; that limits it to really big ticket items, but without that there are a number I wouldn't buy through them.
    - mleonhard 12y ago
      This is the first I've heard of a limit on refunds. Can you point me to more information?
      - hga 12y ago
        I think it's their "A-to-z Guarantee Protection", and I now note no lifetime limit ... and claims can be denied for other than clear cut legit reasons (a catch-all "Amazon regarded the claim as inappropriate." see https://www.amazon.com/gp/help/customer/display.html?nodeId=200783790 https://www.amazon.com/gp/help/customer/display.html?nodeId=...). Also a $2,500 limit. Note this is the last ditch, the seller isn't playing ball resort.
- sytelus 12y ago
  I used to trust Amazon for the low price but these days I'm finding they have let loose all the 3rd party vendors. You will see several products who are falsely claimed to be sold by well known brands like Sony but underneath there would be someone in China putting that up. Many times they are fake and many times merchants play the tricks of putting it on Prime but charging 20-50% more. I feel Amazon has left customers in water because there is no way to know if merchant selling products is genuine and has priced it reasonably
- r00fus 12y ago
  Also subscriptions (i.e., repeat purchases) randomly fail to fulfill for me. Very not good if you're relying on that sub. More and more companies are not relying on Amazon as a key initial channel - e.g. LG's new bluetooth headset (LBS 900) is not authorized yet to be sold on Amazon. If you search for it, you see some knockoff item that has a 1-star review telling you not to buy what is clearly not an LG product. I'm finding that Google Shopping Express is quite a good contender for some very useful things... the selection is limited, though the pricing can be good. More importantly, they deliver same-day... if they'd only do perishables, I'd be set :)
increment_i 12y ago
The fire phone was a completely unnecessary waste of resources - I wonder how much that contributed to this dreary news.
- uptown 12y ago
  According to their CFO, it amounts to a $170m loss, with "$83 million worth of Fire Phone inventory on hand at the end of the last quarter". http://www.geekwire.com/2014/amazon-takes-170m-loss-fire-phone/ http://www.geekwire.com/2014/amazon-takes-170m-loss-fire-pho...
  - vishnugupta 12y ago
    It'd easily be significantly higher if they managed to quantify the opportunity cost in areas that are doing well (e.g., Kindle reader, AWS, warehouse automation etc.,).
untog 12y ago
When will Amazon get out of the hardware business already? The Kindle Fire? Awful. Fire Phone? Awful. Whatever their TV box is? Well, jury is still out, but... Amazon excels at many things, but they've demonstrated that hardware (well, actually, primarily the software that runs on the hardware, but still both) is a huge weakness.
- nkozyra 12y ago
  I'm not interested in any of these products but here's my impression: - Kindle Fire initially fulfilled an unmet market - Android(y) tablets for less than $200 that weren't total garbage. When the Kindle Fire launched, there were none. Tablets cost $300+ unless you were satisfied with some terrible off-brand tablet. - The Fire phone. Total flop. Total miss. They offered nothing to the average Android phone user that wasn't already available, often for cheaper. Amazon has been giving the milk away for free and are now reigning in their services (which is why there's no Amazon Prime for Chromecast, for example). - The TV. I think it's sleek looking and competitively priced (with everything but the Chromecast, cough, cough). You're basically throwing a dart at Apple TV, Roku, Google Player and the Amazon TV product, though. I welcome anyone to the hardware market, primarily because the competition will drive this and frankly we have some dismal options outside of phones. Anything that can drive innovation (and prices downward) sounds good to me. Flops will happen along the way. Companies will try things and fail magnificently and that's ultimately good for (almost) everyone.
  - ido 12y ago
    For a while the kindle fire was the android tablet - as a game developer you'd often sell more tablet games on amazon's app store than on google's.
- Afforess 12y ago
  I disagree about the Kindle Fire, it is still the go-to cheap tablet device for non-techies (which is most of the consumer market). The high end tablet market is dominated by Apple. Everything else is a rounding error.
- taeric 12y ago
r12s 12y ago
Benedict Evans (Andreessen Horowitz) wrote an excellent post on Amazon's "profits". The comments are good value too. http://ben-evans.com/benedictevans/2014/9/4/why-amazon-has-no-profits-and-why-it-works http://ben-evans.com/benedictevans/2014/9/4/why-amazon-has-n... As for the Fire Phone and it's product discovery functionality, I get Bezos' vision (I think ...) which would be a world with only one retailer.
- rodgerd 12y ago
  > As for the Fire Phone and it's product discovery functionality, I get Bezos' vision (I think ...) which would be a world with only one retailer. One retailer, one IT supplier. All staffed by minimum-wage, high churn drones. Not sure who will be buying the product.
- stephenr 12y ago
  I don't understand the Amazon loving crowd. The CEO flat out says he wants to undercut all competition until he has none, and then raise prices.. And people still buy through Amazon, still use aws, etc.
  - ertdfgcb 12y ago
    Really? Do you have a source?
bsder 12y ago
Now that states are forcing Amazon to collect sales tax, it has no in-built price advantage over brick-and-mortar stores. Additionally, the brick-and-mortar stores are using their retail space to handle deliveries and returns that Amazon has to deal with in terms of postage. Basically, the brick-and-mortar stores have finally pulled their heads out of their asses, and Amazon has nothing to fight them with. That's why Amazon is getting pummeled.
- uptown 12y ago
  In some cases, they've dramatically increased their prices on some products. A concrete example: Honey Bunches of Oats 3 pack cost $14.33 with free Prime shipping in November, 2012. Today, that same pack costs $29.99 and is no longer eligible for Prime. I've seen the same pricing trends across a number of their products, but other online retailers offer the same items for considerably less. I think they thought consumers might just stick with them because of habits and the expediency of "Prime" but when prices jump by over 100%, you can bet I'll seek alternatives.
  - adventured 12y ago
    Pack of 4 Honey Bunches of Oats, $22.20 and free shipping on orders of $35. The price is higher per unit, but nowhere near the doubling you're referring to - that's a supplier price squeeze most likely (either the product is being phased out, there are only a few left, or not very many suppliers). http://www.amazon.com/Honey-Bunches-Oats-Roasted-14-5-Ounce/dp/B001EQ5DII http://www.amazon.com/Honey-Bunches-Oats-Roasted-14-5-Ounce/... Alternatively you can use Prime Pantry perhaps: You could buy 8 boxes for about $32 with the delivery fee included ($4 per box); and this is the 18oz size, larger than the 14.5oz size in the previous link. http://www.amazon.com/Honey-Bunches-Oats-Crunchy-Roasted/dp/B00IAE91AI http://www.amazon.com/Honey-Bunches-Oats-Crunchy-Roasted/dp/...
  - ams6110 12y ago
    honestly, people are buying Honey Bunches of Oats on Amazon? My mind reels.
bane 12y ago
I've started to hate shopping on Amazon. The other day I was looking for a tablet, typed in the search, gota huge list of results (mostly not relevant). Prices are $xxx used and new. Okay, so is it $xxx used or new? Inquiring minds want to know! Clicked through to the listing. No price. There's a bunch of other gibberish, it's not being sold by Amazon, and no price. Have to add it to my cart to see the price. Really? All I want is to see a) do you have the tablet I want? b) what does it cost? c) when can it be delivered? I don't care about the 173 other vendors that sell it, the used or new price (no category for refurbished btw), or any of that. I don't want to have to add a dozen copies of the same item to my cart just to see what it'll cost, or if I have to pay shipping, or what the shipping will cost. It's becoming absurd. I think sometime in the last year, Amazon jumped the shark and has moved to a model of actively hiding things from the users...this is usually the beginning of a death spiral for many companies and it explains reduced business volume. It's something pathological that companies seem to want to do, make it hard to buy their stuff, that always seems to indicate the beginning of the end. edit dammit now Newegg is pulling the same "see price in cart" shenanigans....I'm about done with on-line shopping...time to just go to Best Buy or Costco
- nate_meurer 12y ago
  I've been redirecting my purchases to Newegg whenever possible, partly for this reason. Newegg's Marketplace (the term just refers to items sold by third parties using newegg's site) is seamlessly integrated with their core retail business; marketplace items appear alongside items sold directly by newegg, and the pricing remains transparent. Some stuff is quite a bit more eggspensive than on amazon, but I love newegg's troll-fighting work so much that I consider the extra expense a charitable donation.
  - bane 12y ago
    Yeah, I was just looking at Newegg for those reasons. I buy my computer stuff from them because I think they're worth supporting.* But dammit if they also aren't starting to pull the old "see price in cart" scam. No! I will not see the price in the cart. You've lost a sale. * Last time I built a computer I was so informed by NewEgg's interviews with the reps from the various parts companies that I really didn't have to do much other reading. I knew based on the interview with each company's rep basically what I wanted to buy, which tier of product and what I'd get for it. It was such a better experience for me than reading a bunch of hardware sites. The computer I built based on that is the best computer I've ever had.
christoph 12y ago
The biggest thing that pisses me off at the moment is their shipping. I refuse to pay for prime due to the way it seems to be enforced on the user and their near dark pattern techniques to get you to sign up at every checkout. Whenever I order something now and pick the cheapest or free shipping method, it seems to always sit in their warehouse for nearly a week before they even consider shipping it. It seems like another shady attempt to force me over to prime. Most of the time I can buy the same product for similar or cheaper (after shipping) from another retailer and not have to wonder how many days it will take them to ship it, or be upsold into a delivery club at every turn.
- sliverstorm 12y ago
  That's the deal, though. 7-14 day shipping (or whatever it is exactly). If it sits around in the warehouse for a week, that's their prerogative. Maybe the warehouse is operating at capacity, so they put off your order. Maybe they are trying to goad you. I don't see why it matters, you are getting what's promised.
  - arbuge 12y ago
    True but the real point is that he's sufficiently annoyed at that situation to try other retailers instead...
- baddox 12y ago
  > I refuse to pay for prime due to the way it seems to be enforced on the user and their near dark pattern techniques to get you to sign up at every checkout. I've had Prime since shortly after it was first released (it's a no-brainer for me), so I've never encountered these "dark pattern techniques." Can you explain in more detail what you mean? I've also never experienced shipping delays, but again I've had Prime for a long time.
  - coliveira 12y ago
    They offer Prime every time you buy something at Amazon. It is annoying if you really don't want to sign for it.
jmspring 12y ago
So many people are comfortable with Amazon as the store front that if they just turned the knob up a bit where transactions were marginally more expensive, but not inordinately so, they bring in more money and likely don't lose much traffic. I expect this knob to be turned a bit in the coming months.
MCRed 12y ago
I've always thought of Amazon as a company whose primary product was their own stock. They had a great model-- their terms with vendors were such that they often had the customers cash for weeks before they had to pay the vendor. When I worked there the emphasis was always on new press releases. So they created many silly things that never stuck-- like Amazon catalog shopping: They took paper catalogs from other retailers, sent them to the phillipenes to be scanned and then hosted them. Amazon movie times. Amazon local restaurant menus. All of these are now gone. I worked on the product search engine, and for laughs I like to go back and check the regressions that we worked on during my time there. About 9 months after I left, a key one came back... and it's still there many years later. I think this is because they simply disbanded the search team. I'm sure it's been since reformulated and disbanded several times. But the regressions in question, by the way, we had automated tests for. We tested for them before we pushed code.... I think those tests have been lost in the chaos. Amazon was constantly reorganizing.. and products (software products) would get abandoned because the team would be dissipated. They were also very poorly managed for a "Tech" company. My boss had trained to be a prison guard-- I kid you not-- his degree was in criminal justice. By the time I left, %80 of the team had left for other positions. His boss was one of those old school middle managers who you would expect to be running the DMV. Neither of them were technical- their skills extended to managing email and spreadsheets. And yet the stock has continued to rise, even on little or no profits. They're great at selling stock-- look at the P/E ratio.
- sillysaurus3 12y ago
  It's alarming how consistent HN comments are regarding working at Amazon: management is dysfunctional. Might Amazon secretly be one of the worst famous large tech companies to work for?
  - kyllo 12y ago
    I've heard from several ex-Amazon employees that average employee tenure is less than a year and a half. That is not a good sign.
  - sytelus 12y ago
jackcarter 12y ago
This is barely on-topic, but hoping that someone has a workaround, I'll share my biggest gripe with Amazon: When you find a product with multiple options (say, color[1]), often the variations will have different prices. It tells you the minimum and maximum price, but forces you to click through every single variant to see their prices. To make matters worse, it takes multiple seconds to load each price. Is there any way to view product variants in a table format? [1]http://www.amazon.com/Nalgene-Tritan-BPA-Free-Bottle-1-Quart/dp/B001NCDE8O/ref=sr_1_1?s=sporting-goods&ie=UTF8&qid=1414203128&sr=1-1&keywords=nalgene http://www.amazon.com/Nalgene-Tritan-BPA-Free-Bottle-1-Quart...
coliveira 12y ago
I (and many investors) just think that Amazon is badly managed from the financial standpoint. I don't see any problem in reinvesting your profits, but you also don't need to incur a loss every quarter for this purpose. Just adjust your metrics so that you spend a bit less than you make. The fact that they cannot manage to do this tells the world that: (1) they don't care about investors money (2) they don't have the ability to control costs even though they're making billions of dollars in revenue. These things together can be a recipe for disaster if there is any problem in the economy (think of 2001 or 2008).
- TheEzEzz 12y ago
  > These things together can be a recipe for disaster if there is any problem in the economy (think of 2001 or 2008). Amazon was founded in 94 and lived through both bubbles.
  - Chronic29 12y ago
    Amazon also posts quarterly losses.
blhack 12y ago
Wow, you guys all seem to have extremely different experiences with amazon than I do. I buy everything I can on amazon, I love having prime (it would be one of the last things to go if I was cutting costs heavily). I also have no problems with the search. Anecdotally, I see more and more people I know signing up for prime and doing most of their shopping on Amazon. From my perspective, Target/Wal Mart should be really scared of this.
- Chronic29 12y ago
  Amazon shopping is only one of many Amazon products.
WalterBright 12y ago
It seems only just 5 days ago that Amazon was an unstoppable juggernaut taking over the world! https://news.ycombinator.com/item?id=8481011 https://news.ycombinator.com/item?id=8481011
- arbuge 12y ago
  ...and since then it's only grown bigger. Plus ca change...
r0h1n 12y ago
Pertinent question by BBC from 2001: "When will Amazon make a profit?" [1] > But its overall performance has remained loss making as it invests in new areas and products as part of its 'land grab' strategy. > The strategy is to secure a large slab of the global etail market as it evolves. > The idea is that this large share of the market can then be converted into profits in years to come. It's amazing how 13 years on Amazon is still pretty much where it was in 2001 in terms of philosophy and losses. And I suppose the answer still remains, its "large share of the market can then be converted into profits in years to come." [Edit - added URL] [1] - http://news.bbc.co.uk/2/hi/business/1195954.stm http://news.bbc.co.uk/2/hi/business/1195954.stm
jvagner 12y ago
This topic gets ping-ponged depending on the prevailing weather conditions. Amazon has been clear about what they're doing: sometimes this is genius, and sometimes this is diabolically stupid for shareholders. When a CEO has a 20+ year plan and doesn't vacillate from it, it's bizarre for those who've bought in to complain every quarter. I do think, however, that Amazon's recent high profile product failures have fueled the Amazon growth dissidents. This is Bezos' big mistake... he's gift-wrapping the big wins to the opposition. And IMHO, it's absolutely legitimate to wonder how the Fire phone ever made it to market. It was absolutely, positively obvious that it wasn't a good product. All big companies put out products that fail, and that's an acceptable churn on the road to success, but this example shows that there's a huge disconnect inside the company with respect to the viability of early product iterations. They blew it, big time. If Bezos had anything to do with approving it, his round table isn't, or can't, giving good guidance. I personally used to "love" Amazon. Now they're Just Another Etailer. They've missed on the emotional customer adherence front, somehow.

77 points by dataminer 12y ago

Yikes. I use them both for their AWS service and as a consumer of their ecommerce side. I don't do much with their Prime programming, but I have a membership. There are a couple of areas where Amazon got worse since 2012 on the ecommerce side. First, Add-on items are annoying. Stuff I used to order and get for free now has to be bundled. I get why they are doing this, but it's just jarring. Second, their prices actually seem to be getting higher. I can often now find equivalent products cheaper locally. Tools are especially bad that way: Home Depot regularly beats them. Clothing is a crapshoot, but I generally find better sales at local stores as well. Amazon will typically have the best of breed item, while not having a basic version for a reasonable price. For example, last winter I bought winter gloves. Amazon had great ones, with good reviews, etc. but I bought a pair for 80% less that while not as good was very adequate. I checked later and Amazon did not carry this brand or much decent stuff at this price point. Search is getting worse. More products are miscategorized and you have to be very careful about what you buy. Here's a quick example, search for "GoPro". You'll get many duplicate options, often with confusing descriptions, in different departments, etc. They are still a powerhouse when it comes to online shopping, but I really wish someone gave them a kick in the ass in terms of pricing and usability.

Zombieball 12y ago
I was under the impression that the majority of products offered on Amazon is through third party sellers (who set the price) and Amazon is merely the fullfilment channel. However, I don't know the real split between the number of sold by Amazon vs. Fulfilled by Amazon products available.
- desdiv 12y ago
  Third-party sales is about 39% of Amazon's units sold[0]. The actual value of third-party sales is probably a more useful and informative measure, but I can't seem to find that information anywhere. All I can find is this outdated (2008) report that vaguely says it's "around 40%"[1]. [0]http://www.forbes.com/sites/greatspeculations/2013/01/30/amazons-third-party-sellers-drive-margins-and-stock-higher/ http://www.forbes.com/sites/greatspeculations/2013/01/30/ama... [1]http://web.stanford.edu/class/ee204/Publications/Amazon-EE353-2008-1.pdf http://web.stanford.edu/class/ee204/Publications/Amazon-EE35...
bitL 12y ago
Median selling fee is 15% from the end price so if you run your own marketing/ads/sales, you can offer prices without this "tax". This pushes 3rd party sellers to either very low margins (especially in electronics) or higher prices on Amazon in exchange for discoverability and no need to run your own SEO/eshop/marketing etc.
- hga 12y ago
  Amazon has something of a monopoly on trust in 3rd party sales. Lots of experience gives me great confidence in sellers with a 96% or greater rating, and willingness to pay more. Whereas my father and I have found in an iPhone purchase (an old, but still well over $100 model) that eBay can be trivially played to completely screw over the buyer. For that matter, Amazon has a 5 refunds per lifetime policy last time I checked; that limits it to really big ticket items, but without that there are a number I wouldn't buy through them.
  - mleonhard 12y ago
    This is the first I've heard of a limit on refunds. Can you point me to more information?
    - hga 12y ago
      I think it's their "A-to-z Guarantee Protection", and I now note no lifetime limit ... and claims can be denied for other than clear cut legit reasons (a catch-all "Amazon regarded the claim as inappropriate." see https://www.amazon.com/gp/help/customer/display.html?nodeId=200783790 https://www.amazon.com/gp/help/customer/display.html?nodeId=...). Also a $2,500 limit. Note this is the last ditch, the seller isn't playing ball resort.
sytelus 12y ago
I used to trust Amazon for the low price but these days I'm finding they have let loose all the 3rd party vendors. You will see several products who are falsely claimed to be sold by well known brands like Sony but underneath there would be someone in China putting that up. Many times they are fake and many times merchants play the tricks of putting it on Prime but charging 20-50% more. I feel Amazon has left customers in water because there is no way to know if merchant selling products is genuine and has priced it reasonably
r00fus 12y ago
Also subscriptions (i.e., repeat purchases) randomly fail to fulfill for me. Very not good if you're relying on that sub. More and more companies are not relying on Amazon as a key initial channel - e.g. LG's new bluetooth headset (LBS 900) is not authorized yet to be sold on Amazon. If you search for it, you see some knockoff item that has a 1-star review telling you not to buy what is clearly not an LG product. I'm finding that Google Shopping Express is quite a good contender for some very useful things... the selection is limited, though the pricing can be good. More importantly, they deliver same-day... if they'd only do perishables, I'd be set :)

increment_i 12y ago

The fire phone was a completely unnecessary waste of resources - I wonder how much that contributed to this dreary news.

uptown 12y ago
According to their CFO, it amounts to a $170m loss, with "$83 million worth of Fire Phone inventory on hand at the end of the last quarter". http://www.geekwire.com/2014/amazon-takes-170m-loss-fire-phone/ http://www.geekwire.com/2014/amazon-takes-170m-loss-fire-pho...
- vishnugupta 12y ago
  It'd easily be significantly higher if they managed to quantify the opportunity cost in areas that are doing well (e.g., Kindle reader, AWS, warehouse automation etc.,).

untog 12y ago

When will Amazon get out of the hardware business already? The Kindle Fire? Awful. Fire Phone? Awful. Whatever their TV box is? Well, jury is still out, but... Amazon excels at many things, but they've demonstrated that hardware (well, actually, primarily the software that runs on the hardware, but still both) is a huge weakness.

nkozyra 12y ago
I'm not interested in any of these products but here's my impression: - Kindle Fire initially fulfilled an unmet market - Android(y) tablets for less than $200 that weren't total garbage. When the Kindle Fire launched, there were none. Tablets cost $300+ unless you were satisfied with some terrible off-brand tablet. - The Fire phone. Total flop. Total miss. They offered nothing to the average Android phone user that wasn't already available, often for cheaper. Amazon has been giving the milk away for free and are now reigning in their services (which is why there's no Amazon Prime for Chromecast, for example). - The TV. I think it's sleek looking and competitively priced (with everything but the Chromecast, cough, cough). You're basically throwing a dart at Apple TV, Roku, Google Player and the Amazon TV product, though. I welcome anyone to the hardware market, primarily because the competition will drive this and frankly we have some dismal options outside of phones. Anything that can drive innovation (and prices downward) sounds good to me. Flops will happen along the way. Companies will try things and fail magnificently and that's ultimately good for (almost) everyone.
- ido 12y ago
  For a while the kindle fire was the android tablet - as a game developer you'd often sell more tablet games on amazon's app store than on google's.
Afforess 12y ago
I disagree about the Kindle Fire, it is still the go-to cheap tablet device for non-techies (which is most of the consumer market). The high end tablet market is dominated by Apple. Everything else is a rounding error.
taeric 12y ago

r12s 12y ago

Benedict Evans (Andreessen Horowitz) wrote an excellent post on Amazon's "profits". The comments are good value too. http://ben-evans.com/benedictevans/2014/9/4/why-amazon-has-no-profits-and-why-it-works http://ben-evans.com/benedictevans/2014/9/4/why-amazon-has-n... As for the Fire Phone and it's product discovery functionality, I get Bezos' vision (I think ...) which would be a world with only one retailer.

rodgerd 12y ago
> As for the Fire Phone and it's product discovery functionality, I get Bezos' vision (I think ...) which would be a world with only one retailer. One retailer, one IT supplier. All staffed by minimum-wage, high churn drones. Not sure who will be buying the product.
stephenr 12y ago
I don't understand the Amazon loving crowd. The CEO flat out says he wants to undercut all competition until he has none, and then raise prices.. And people still buy through Amazon, still use aws, etc.
- ertdfgcb 12y ago
  Really? Do you have a source?

bsder 12y ago

Now that states are forcing Amazon to collect sales tax, it has no in-built price advantage over brick-and-mortar stores. Additionally, the brick-and-mortar stores are using their retail space to handle deliveries and returns that Amazon has to deal with in terms of postage. Basically, the brick-and-mortar stores have finally pulled their heads out of their asses, and Amazon has nothing to fight them with. That's why Amazon is getting pummeled.

uptown 12y ago
In some cases, they've dramatically increased their prices on some products. A concrete example: Honey Bunches of Oats 3 pack cost $14.33 with free Prime shipping in November, 2012. Today, that same pack costs $29.99 and is no longer eligible for Prime. I've seen the same pricing trends across a number of their products, but other online retailers offer the same items for considerably less. I think they thought consumers might just stick with them because of habits and the expediency of "Prime" but when prices jump by over 100%, you can bet I'll seek alternatives.
- adventured 12y ago
  Pack of 4 Honey Bunches of Oats, $22.20 and free shipping on orders of $35. The price is higher per unit, but nowhere near the doubling you're referring to - that's a supplier price squeeze most likely (either the product is being phased out, there are only a few left, or not very many suppliers). http://www.amazon.com/Honey-Bunches-Oats-Roasted-14-5-Ounce/dp/B001EQ5DII http://www.amazon.com/Honey-Bunches-Oats-Roasted-14-5-Ounce/... Alternatively you can use Prime Pantry perhaps: You could buy 8 boxes for about $32 with the delivery fee included ($4 per box); and this is the 18oz size, larger than the 14.5oz size in the previous link. http://www.amazon.com/Honey-Bunches-Oats-Crunchy-Roasted/dp/B00IAE91AI http://www.amazon.com/Honey-Bunches-Oats-Crunchy-Roasted/dp/...
- ams6110 12y ago
  honestly, people are buying Honey Bunches of Oats on Amazon? My mind reels.

bane 12y ago

I've started to hate shopping on Amazon. The other day I was looking for a tablet, typed in the search, gota huge list of results (mostly not relevant). Prices are $xxx used and new. Okay, so is it $xxx used or new? Inquiring minds want to know! Clicked through to the listing. No price. There's a bunch of other gibberish, it's not being sold by Amazon, and no price. Have to add it to my cart to see the price. Really? All I want is to see a) do you have the tablet I want? b) what does it cost? c) when can it be delivered? I don't care about the 173 other vendors that sell it, the used or new price (no category for refurbished btw), or any of that. I don't want to have to add a dozen copies of the same item to my cart just to see what it'll cost, or if I have to pay shipping, or what the shipping will cost. It's becoming absurd. I think sometime in the last year, Amazon jumped the shark and has moved to a model of actively hiding things from the users...this is usually the beginning of a death spiral for many companies and it explains reduced business volume. It's something pathological that companies seem to want to do, make it hard to buy their stuff, that always seems to indicate the beginning of the end. edit dammit now Newegg is pulling the same "see price in cart" shenanigans....I'm about done with on-line shopping...time to just go to Best Buy or Costco

nate_meurer 12y ago
I've been redirecting my purchases to Newegg whenever possible, partly for this reason. Newegg's Marketplace (the term just refers to items sold by third parties using newegg's site) is seamlessly integrated with their core retail business; marketplace items appear alongside items sold directly by newegg, and the pricing remains transparent. Some stuff is quite a bit more eggspensive than on amazon, but I love newegg's troll-fighting work so much that I consider the extra expense a charitable donation.
- bane 12y ago
  Yeah, I was just looking at Newegg for those reasons. I buy my computer stuff from them because I think they're worth supporting.* But dammit if they also aren't starting to pull the old "see price in cart" scam. No! I will not see the price in the cart. You've lost a sale. * Last time I built a computer I was so informed by NewEgg's interviews with the reps from the various parts companies that I really didn't have to do much other reading. I knew based on the interview with each company's rep basically what I wanted to buy, which tier of product and what I'd get for it. It was such a better experience for me than reading a bunch of hardware sites. The computer I built based on that is the best computer I've ever had.

christoph 12y ago

The biggest thing that pisses me off at the moment is their shipping. I refuse to pay for prime due to the way it seems to be enforced on the user and their near dark pattern techniques to get you to sign up at every checkout. Whenever I order something now and pick the cheapest or free shipping method, it seems to always sit in their warehouse for nearly a week before they even consider shipping it. It seems like another shady attempt to force me over to prime. Most of the time I can buy the same product for similar or cheaper (after shipping) from another retailer and not have to wonder how many days it will take them to ship it, or be upsold into a delivery club at every turn.

sliverstorm 12y ago
That's the deal, though. 7-14 day shipping (or whatever it is exactly). If it sits around in the warehouse for a week, that's their prerogative. Maybe the warehouse is operating at capacity, so they put off your order. Maybe they are trying to goad you. I don't see why it matters, you are getting what's promised.
- arbuge 12y ago
  True but the real point is that he's sufficiently annoyed at that situation to try other retailers instead...
baddox 12y ago
> I refuse to pay for prime due to the way it seems to be enforced on the user and their near dark pattern techniques to get you to sign up at every checkout. I've had Prime since shortly after it was first released (it's a no-brainer for me), so I've never encountered these "dark pattern techniques." Can you explain in more detail what you mean? I've also never experienced shipping delays, but again I've had Prime for a long time.
- coliveira 12y ago
  They offer Prime every time you buy something at Amazon. It is annoying if you really don't want to sign for it.

jmspring 12y ago

So many people are comfortable with Amazon as the store front that if they just turned the knob up a bit where transactions were marginally more expensive, but not inordinately so, they bring in more money and likely don't lose much traffic. I expect this knob to be turned a bit in the coming months.

MCRed 12y ago

I've always thought of Amazon as a company whose primary product was their own stock. They had a great model-- their terms with vendors were such that they often had the customers cash for weeks before they had to pay the vendor. When I worked there the emphasis was always on new press releases. So they created many silly things that never stuck-- like Amazon catalog shopping: They took paper catalogs from other retailers, sent them to the phillipenes to be scanned and then hosted them. Amazon movie times. Amazon local restaurant menus. All of these are now gone. I worked on the product search engine, and for laughs I like to go back and check the regressions that we worked on during my time there. About 9 months after I left, a key one came back... and it's still there many years later. I think this is because they simply disbanded the search team. I'm sure it's been since reformulated and disbanded several times. But the regressions in question, by the way, we had automated tests for. We tested for them before we pushed code.... I think those tests have been lost in the chaos. Amazon was constantly reorganizing.. and products (software products) would get abandoned because the team would be dissipated. They were also very poorly managed for a "Tech" company. My boss had trained to be a prison guard-- I kid you not-- his degree was in criminal justice. By the time I left, %80 of the team had left for other positions. His boss was one of those old school middle managers who you would expect to be running the DMV. Neither of them were technical- their skills extended to managing email and spreadsheets. And yet the stock has continued to rise, even on little or no profits. They're great at selling stock-- look at the P/E ratio.

sillysaurus3 12y ago
It's alarming how consistent HN comments are regarding working at Amazon: management is dysfunctional. Might Amazon secretly be one of the worst famous large tech companies to work for?
- kyllo 12y ago
  I've heard from several ex-Amazon employees that average employee tenure is less than a year and a half. That is not a good sign.
- sytelus 12y ago

jackcarter 12y ago

This is barely on-topic, but hoping that someone has a workaround, I'll share my biggest gripe with Amazon: When you find a product with multiple options (say, color[1]), often the variations will have different prices. It tells you the minimum and maximum price, but forces you to click through every single variant to see their prices. To make matters worse, it takes multiple seconds to load each price. Is there any way to view product variants in a table format? [1]http://www.amazon.com/Nalgene-Tritan-BPA-Free-Bottle-1-Quart/dp/B001NCDE8O/ref=sr_1_1?s=sporting-goods&ie=UTF8&qid=1414203128&sr=1-1&keywords=nalgene http://www.amazon.com/Nalgene-Tritan-BPA-Free-Bottle-1-Quart...

coliveira 12y ago

I (and many investors) just think that Amazon is badly managed from the financial standpoint. I don't see any problem in reinvesting your profits, but you also don't need to incur a loss every quarter for this purpose. Just adjust your metrics so that you spend a bit less than you make. The fact that they cannot manage to do this tells the world that: (1) they don't care about investors money (2) they don't have the ability to control costs even though they're making billions of dollars in revenue. These things together can be a recipe for disaster if there is any problem in the economy (think of 2001 or 2008).

TheEzEzz 12y ago
> These things together can be a recipe for disaster if there is any problem in the economy (think of 2001 or 2008). Amazon was founded in 94 and lived through both bubbles.
- Chronic29 12y ago
  Amazon also posts quarterly losses.

blhack 12y ago

Wow, you guys all seem to have extremely different experiences with amazon than I do. I buy everything I can on amazon, I love having prime (it would be one of the last things to go if I was cutting costs heavily). I also have no problems with the search. Anecdotally, I see more and more people I know signing up for prime and doing most of their shopping on Amazon. From my perspective, Target/Wal Mart should be really scared of this.

Chronic29 12y ago
Amazon shopping is only one of many Amazon products.

WalterBright 12y ago

It seems only just 5 days ago that Amazon was an unstoppable juggernaut taking over the world! https://news.ycombinator.com/item?id=8481011 https://news.ycombinator.com/item?id=8481011

arbuge 12y ago
...and since then it's only grown bigger. Plus ca change...

r0h1n 12y ago

Pertinent question by BBC from 2001: "When will Amazon make a profit?" [1] > But its overall performance has remained loss making as it invests in new areas and products as part of its 'land grab' strategy. > The strategy is to secure a large slab of the global etail market as it evolves. > The idea is that this large share of the market can then be converted into profits in years to come. It's amazing how 13 years on Amazon is still pretty much where it was in 2001 in terms of philosophy and losses. And I suppose the answer still remains, its "large share of the market can then be converted into profits in years to come." [Edit - added URL] [1] - http://news.bbc.co.uk/2/hi/business/1195954.stm http://news.bbc.co.uk/2/hi/business/1195954.stm

jvagner 12y ago

This topic gets ping-ponged depending on the prevailing weather conditions. Amazon has been clear about what they're doing: sometimes this is genius, and sometimes this is diabolically stupid for shareholders. When a CEO has a 20+ year plan and doesn't vacillate from it, it's bizarre for those who've bought in to complain every quarter. I do think, however, that Amazon's recent high profile product failures have fueled the Amazon growth dissidents. This is Bezos' big mistake... he's gift-wrapping the big wins to the opposition. And IMHO, it's absolutely legitimate to wonder how the Fire phone ever made it to market. It was absolutely, positively obvious that it wasn't a good product. All big companies put out products that fail, and that's an acceptable churn on the road to success, but this example shows that there's a huge disconnect inside the company with respect to the viability of early product iterations. They blew it, big time. If Bezos had anything to do with approving it, his round table isn't, or can't, giving good guidance. I personally used to "love" Amazon. Now they're Just Another Etailer. They've missed on the emotional customer adherence front, somehow.