Amazon Markets Its E-commerce Technology

Discussion
Jun 11, 2003
Rick Moss

Amazon Markets Its E-commerce Technology


By
Rick Moss


Amazon will launch a wholly-owned subsidiary offering services and technology
to help retailers develop their own online enterprises. Amazon’s e-commerce
and distribution systems are already being put to use in co-ventures with Target,
Toys R Us, Borders Books, cd.now and others. Says chief executive Jeff, “These
retailers can grow their online businesses faster and less expensively by taking
advantage of what we’ve learned and built over the past eight years, while still
preserving 100 percent of their own branded look and feel.”


The introduction of Amazon Services at the Retail Systems 2003 Show in Chicago
formalized the extended offerings that already account for 20 percent of the
company’s unit volume, says Bezos, and is the fastest growing part of the company’s
business.


To be offered with the service is e-commerce development (as turn-key or in
part), access to Amazon’s 30 million active customers, order fulfillment via
Amazon’s massive distribution centers, and e-mail and phone customer service.
Adding the shipments for its services customers is a “few more drops of water
in the bucket,” Bezos said.


Moderator’s Comment: Will the availability of Amazon
technology make it senseless for retailers to develop their own proprietary
systems? What does this mean for the future of e-commerce systems development?


Comparisons between Wal-Mart and Amazon are easy to see.
However, where Wal-Mart is gobbling up share of wallet and burying competition,
Amazon is finding ways to partner with businesses seeking growth onto the internet.
Bezos was clear about respecting the need of his retail customers to maintain
brand identity. But for major retailers, is it wise to depend so crucially on
Amazon for what may some day become 15 or 20 percent of their sales? If, at
some point, they become discontent with the Amazon’s services, will they be
able to extricate themselves? [Rick
Moss – Moderator
]


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