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The e-commerce.

Disappointing profits hit Amazon


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Amazon sells books often at or below cost. They have tried selling their technology to other large e-commerce sites with mixed success. The expansions into selling everyting and anything on line have mixed results too. So the pressure is on for them to raise their prices on the loss-leaders, i.e. books, or make the new ventures work. Most of us are not in this position.



David Watson

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My January sales were up 874% over last January. This January was my second best month ever (barely behind my best). Amazon is not a good barometer of online retailing. Each of our businesses are unique, in both products and our business models. Like the previous person said, Amazon likes to loose money by giving huge discounts - they leverage this to gain market share. It has made them a household name, so it must be working...

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If there profits are down, where does that leave the rest of us:?  ;)



Hopefully, your products are priced so that they are making you a profit on every sale. Amazon doesn't price that way. They lose money on thousands of products that are "on sale" or priced below MSRP just to get people on their site. Add in the millions spent every month on free shipping and other promotional materials and many sales can be losing them money. This is before new competitors who recently entered the market like Walmart.com and Overstock.com.


As a small operator, you cannot compete with the low price leaders. You need to price your product aggressively but never lose sight of profit. If you do compete with the low price leaders and don't have the bulk margins to cover it (i.e. buying product by the cargo container) then there really is no sympathy from me if you don't make a profit.

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I must admit that I find the Amazon website a bit confusing.


The worst aspect is that they allow others to sell through their website alongside their own products. I find this confusing as it can be difficult to see exactly who the seller is.


A major aspect of e-commerce is customer confidence. Whilst the Amazon brand inspires confidence, I don't think the same can be said about the others that sell through their website.


I also find it difficult to locate the items I want. Their pages often look very cluttered with poor layout making it difficult to navigate.


They didn't do themselves any favours in the UK at Christmas either. Poor delivery times and accepting orders for products that they couldn't fulfill. We had items turning up late, and they just emailed saying that an order couldn't be fulfilled (it was placed in early December).


But maybe its just me.



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I agree that at times their website isn't that easy to navigate. But I do like how they market me based on my past purchases - they do promote relevant things to me. Besides, I don't navigate their site - I rely on searches to find books.


By the way, what ever happened to my Gold Box? I never looked at it, but it was interesting to have my very own gold box in the upper corner.

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