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Measuring Amazon’s Impact On CE

Back in 2000 I called an executive at a major CE manufacturer to inform him that was carrying his company’s products. He adamantly said, “That’s impossible. We have not authorized any website to sell our products!”

Today can you imagine any major CE brand not wanting to be carried online today, especially Amazon?

Back then a lot of veteran retailers began yelling, “The sky is falling!” when discussing online retailing and Amazon in particular.

Well, it didn’t happen overnight, but online retailing — and in particular — revolutionized retailing forever and CE retailing in particular, which is why TWICE has dedicated a good portion of this issue on a Special Report about the company.

The old-school measurement of success in retailing is usually sales volume. By that measure, has grown from $3.3 billion in CE sales back in 2008 to almost four times that — $12.9 billion — in 2012. (Take a look at the chart on p. 12.) And it is still growing, putting pressure on Best Buy and even Walmart.

But the Amazon impact is so much more than plain old sales volume. It is a hardware supplier with the Kindle Fire, and probably other products coming soon; it is major supplier of music, videos, games, apps and books; it is the place to go to read reviews of everyone’s products; and via Amazon’s Marketplace, it is where many traditional CE retailers open “storefronts” to cash in on the tremendous number of visitors the site gets every hour of every day.

Amazon has taken the ever-evolving technology of the Internet, and the transformation of CE products and content, from the pre-2000 analog era into the new digital century to create a juggernaut whose momentum is still building.

This TWICE Special Report centers on the hardware side of the business, with an interview with Ben Hartman, consumer electronics VP, highlighting all parts of Amazon’s CE business; a corporate overview of the company; and, of course, a report on sales-tax collection and what impact it might have. TWICE editors have also analyzed how Amazon has impacted several major categories. We hope this exclusive, in-depth report provides some insight as to how Amazon operates and what its impact will be on the CE industry in the near future.

Top 25 Car CE Dealers Outpace Market

Amazon is also in car CE, and it ranks No. 3 in the TWICE Top 25 Car Electronics Retailers Report. Without installation bays, it still had $577 million in sales, down 6.9 percent from the prior year but still amazing.

As a group, the top 25 slipped 2.1 percent in sales during calendar year 2012, but that was better than the 6.7 percent drop in factory sales, according to Consumer Electronics Association statistics. For the complete annual report.