Bezos disputes Amazon’s market power. But his merchants feel the pinch

Fifteen years ago, Jason Boyce made a bet on Amazon that changed his life for the better. He started selling basketball hoops on the site — known mostly for books at the time—and his sales and profits took off. Today, Boyce worries his relationship with the world’s biggest online retailer is getting more and more lopsided. Amazon has evolved from partner to competitor, making products similar to his, selling them for less and giving them prominence on the site. To stand out, Boyce must now buy advertising, which makes Amazon even more profitable at his expense.Amazon.com Inc. Chief Executive Officer Jeff Bezos touted the success of merchants like Boyce this month in his annual letter to shareholders, suggesting they were beating Amazon at its own game because they make up 58% of all sales on the site. What Bezos neglected to mention is that Amazon is the biggest winner of all. Amazon captures 50 cents of every dollar spent online in the US EBay Inc., its closest competitor, gets just six cents.

Read more

You may also like

More in IT

Comments are closed.