Reply to post: Re: Anything to keep fooling the investors

If at first you don't succeed ... Fire, FIRE again: Amazon mulls smartphone sequel

Anonymous Coward
Anonymous Coward

Re: Anything to keep fooling the investors

Patience is one thing, Amazon is simply a leftover dotcom bubble that never burst. It is like fusion power, Amazon actually making money is a mirage that is always in the future.

Reaching for a bigger market share when your margins are near zero is like the old joke about "we lose money on every car we sell, but we'll make it up in volume". They were able to muscle out the brick and mortar book stores, but they can't muscle out the brick and mortar retailers - they all sell on the internet too. Plus there are many other internet based retailers only a click or a price search away, giving Amazon little latitude to decide "now is the time to raise prices so we make better margins and actually show a profit".

First they thought having recommendations "people who bought x also bought y" was the answer, but it is very limited utility. Then they thought having a wider selection than anyone else would make them unique enough they could charge more, but there are thousands of niche sites that collectively have a far wider selection than Amazon ever could. Now they think faster deliveries are the answer, with the same day and one hour stuff they're testing. There's certainly a market for that, but not a big one. Most people are willing to wait a few days to save a few bucks. When they figure that out, they'll have a new scheme they'll hold out to the investors as the way forward.

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