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At the time of its debut, Amazon seemed late to the subscription box trend. After first gaining momentum with the rise of Birchbox in 2010, some experts thought the bubble was bursting. But subscription boxes have witnessed a bit of a renaissance during the pandemic -- and while the surge is led by the industry’s biggest names, more quietly, small retail stores like Speach’s are turning to Amazon to roll out their own subscription-box businesses. They see the boxes as a vital driver of growth in a time when brick-and-mortar retailers are still struggling to make ends meet.
While Section 230 might not be keeping Bezos up at night the way it is Mark Zuckerberg, the law does still have significant implications for Amazon’s future business -- especially when products bought on the site turn out to be dangerous. A small number of court cases are revealing an awkward contradiction for the company: One of Amazon’s greatest strengths as an e-commerce platform -- its vast logistics network -- might also be making it look a lot like the true seller of a third-party item, opening it up to new types liabilities.
A growing network of e-commerce platforms like Shop Where I Live and Bookshop.org have popped up to provide a close-to-home alternative to Amazon. Their vision is of an online shopping world that isn’t dominated by two or three giant companies, but instead is decentralized across hundreds of different, localized websites. Already in a number of cities worldwide, these websites focus on getting small businesses online and creating more equitable business models. But do they present a viable alternative to Amazon's growing dominance?
Amazon unsurprisingly posted record third quarter earnings. Sales exceeded expectations, as did profit. Still there were a few things of note. Amazon didn't highlight its third-party sellers as much as past years, for example. It did, however, nod to its growing suite of new revenue engines. Here's a look at the e-commerce giant's most recent earnings.
In a sense, #BoxedOut was just a clever advertising effort. But the central thrust of the campaign — that a group of small independent booksellers would coordinate to fight Amazon’s disruption of its industry — felt oddly new. While plenty of one-off businesses have criticized Amazon before, coordination on a broader scale is rare. And it might signal a future trend among small retailers struggling to match Amazon and Walmart — if they want to beat the heavy hitters, they need to work together.
Lawyers and other experts who specialize in seller suspensions say that a recent wave of suspensions was among Amazon’s biggest. Craig Gedey, whose firm Thompson and Holt advises suspended sellers, told Modern Retail, “It’s the busiest weekend we’ve had all year.” But the mass suspensions represent a familiar pattern for Amazon -- whenever the company tweaks its algorithm, often without warning, sellers find their livelihoods on ice overnight.
Amazon would really like a peek at your Target receipts, all in the name of refining its ad business. The goal is improved micro-targeting -- if Amazon can figure out what people are not buying on Amazon, for instance, it can serve them ads for Amazon products that they might not think to buy online. What's more, Amazon is collecting all this data in order to learn what kinds of purchases it has yet to monopolize.
More than ever, Amazon sellers are having to trust their guts when it comes to producing inventory and completing Amazon orders during the holiday season. From capitalizing on fourth quarter traffic, to making up for the pandemic-related fulfillment blockage, this year poses a whole new set of challenges for the e-commerce giants' merchants.
Livestream shopping has taken off abroad, but Amazon has struggled to replicate that success on its own platform. So the company is trying a new way to promote its Amazon Live platform: Recruit micro-influencers. The program is still small, but participants say that it has the potential to bring a more social-media-like experience to buying on Amazon.
On Thursday, after the annual two day event, Amazon reported that third-party sellers exceeded $3.5 billion in sales during the promotional event, which was 60% higher than the year before. But the company was mum about some other key details it usually divulges. Meanwhile, other retailers like Walmart and Target tried to make their own promotions to bring Prime Day traffic to their own websites. Put together, with the little data that's been released thus far, we can see that the big retail leaders are scrambling as they try to get through the fourth quarter.
Prime Day is a big sales day for Amazon. While the company doesn't disclose exact revenue figures, the e-commerce giant said that Prime Day sales last year were higher than the last Black Friday and Cyber Monday combined. But Amazon's goal on Prime Day isn't just to get people to buy more physical product. It's also to encourage more people to buy Amazon Prime memberships, and to get the companies that sell on Amazon to spend more on advertising. And that's evidenced by the way that the company encourages Amazon agencies to prepare for Prime Day, by getting their clients to spend more on advertising.
Amazon has a new carrot to dangle in front of struggling retailers. On Tuesday, the e-commerce giant announced a new point of sale solution that it is calling Amazon One. The device allows customers to pay without ever having to take out their phone or credit card, instead paying by placing their palm over a scanning device. But retailers have also become increasingly wary of using Amazon's technology.
The countdown has begun for sellers: after a months-long delay, Amazon has officially announced a new date for Prime Day. Amazon's annual sales event will now be held on October 13-14. On the one hand, some sellers are hoping that more customers will use Prime Day to do their holiday shopping, and allow them to capture a greater share of sales than they would have if the event was once again held in July. But, others are concerned that more shoppers will decide to just wait a few more weeks, in the hopes of getting better deals on Black Friday and Cyber Monday.
As one of the brand founders who've vowed to stay away from Amazon over the years, Camille Rose's Janell Stephens had a change of heart when the pandemic hit. In the past year, she went from attempting to stop second-hand product sales on the site to opening an official Amazon store. Speaking to Modern Retail, the haircare brand's founder and CEO discussed the divisive channel's addition to the company's retail expansion.
Amazon’s long-rumored luxury platform, now known as Luxury Stores, finally launched on Tuesday after months of speculation. Amazon’s main appeal to brands is its scale, but out of the gate, the platform doesn’t make much use of its 112 million Prime members. Luxury Stores is launching with only one brand, Oscar de la Renta, and is invite-only, with the first round of invites going out yesterday. The small scale, single brand, small selection and invite-only model mean that Luxury Stores' potential to drive sales is limited.
In his investor letter, Jeff Bezos confirmed that Amazon Prime now has “more than 200 million subscribers” worldwide. But beyond that top-line figure, a few other numbers in the Bezos letter illustrate exactly where that growth is coming from -- and largely confirm existing speculation about the ascendancy of Amazon’s third-party sellers, its accelerating logistics footprint and the growth of its Alexa system.
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