A Taxing Situation
Prime Cut: Amazon is merging the teams behind its in-house retail and third-party Marketplace operations — a distinction that’s largely lost on most customers anyway.
TWICE Take: Amazon said the changes are designed to make the customer experience “seamless” regardless of the seller, and to provide a standardized assortment of products, tools and services for brands and merchants that use its platform. Maybe. But it may also further compel sellers to use its fulfillment service, and clear the way for streamlined, third-party tax collection now that the Supreme Court has confirmed the right of states to take their pound of flesh.
Private Label Reporting For Duty
Prime Cut: Private-label retail brands are nothing new: Witness Sam’s-brand basics at Walmart, Kenmore appliances at Sears, Mossimo apparel at Target, and Kirkland everything at Costco. But as is typical for the world’s largest e-tailer, Amazon is taking its in-house program to a whole ’nuther level.
TWICE Take: What began as a foray into generic batteries and CE accessories nine years ago has billowed into what analysts believe could soon be a $25 billion business, with some 100 brands encompassing everything from clothing to dog food. Fueling the growth is Amazon’s proprietary toolbox of word-search algorithms, data analysis, machine learning, customer reviews and even default selection when ordering by voice, which steers customers to its own goods, crowds out national brands and may invite an antitrust suit from President Trump.
Ready, Aim, Fired
Prime Cut: Amazon is known for its out-of-the-box approaches to termination, like the $5,000 it offers disgruntled warehouse workers to quit.
TWICE Take: Now a recent program called Pivot gives white-collar staff three options when their jobs are on the line: take a severance payout and leave; spend several weeks on probation in the hope of turning things around; or face down your manager in a “Thunderdome”-like videoconference. The appeal process is intended to cut down on costly turnover and address dysfunctional systems and management, although an employment attorney who was involved in the procedure described it as “a kangaroo court.”
Retailers Primed For Prime Day
Prime Cut: Amazon may have inadvertently spilled the beans about its fourth-annual Prime Day when it briefly posted a banner on its U.K. site announcing July 16 as the start date of its mid-summer promotion.
TWICE Take: The date would jibe with conjecture of a later kick-off this year to avoid competing with the FIFA World Cup. Regardless, retailers appear ready for Amazon’s Prime members-only sales event, which tends to have a halo effect on other online sellers. According to RetailMeNot, the cash-back and coupon-code shopping site, 60 percent of merchants plan to run Prime Day-related promotions, in an effort to capture a piece of the $167 per shopper that consumers will spend on average that day.
Prime Cut: Amazon CEO Jeff Bezos’s Blue Origin spaceship is one step closer to regular passenger service.
TWICE Take: According to Rob Meyerson, senior VP at Bezos’s space exploration start-up, the company expects to fly its first test passengers “soon,” and will likely begin selling tickets for sub-orbital flights next year. No price has been set for a seat on the “New Shepard” spacecraft, although rival Virgin Galactic has some 700 customers lined up who are willing to fork over $250,000 each for the flight of fancy.
Amazon Quote Of The Week
“I think, effectively, you have a company that has conspired with about a billion consumers and technology to destroy brands.” — NYU marketing professor and Gartner L2 founder Scott Galloway on the threat of Amazon’s burgeoning private-label business