The Anti-Amazon Alliance • Hacker News Board

Re: The Anti-Amazon Alliance

#131

Post by theptip » Tue, Apr 28, 2020, 5:36 PM UTC

zbobet2012 wrote: post #11

softwaredoug wrote: post #4

As a consultant, I see companies struggling to compete with Amazon (or Amazon-like companies). Most companies struggle for a couple of reasons - They are ego driven, with legacy execs & others relentlessly protecting their status - whereas Amazon is relentlessly data-driven - They have poor incentive structures and are feature factories. They value velocity over outcomes. Amazon, by being more data driven, is focused…

I agree with your points, but I've also found another one that is far more common: They sell products at a loss to gain income in other places. For example, if you are a content producer you are competing with a company that sells "ad-free" video (Prime Video) attached to a low-cost service (Prime) so that they can sell more goods online. Amazon is killing content producers by running a negative margin content busine…

> That is a strategy only available to... monopolies.

I don't think this is the case. The strategy is called a "loss leader", and it's a very common business strategy.

https://www.investopedia.com/terms/l/lossleader.asp

> Loss leading can be a successful strategy if executed properly. A classic example is razor blades. Gillette, for example, gives their razor units away for free knowing that customers must buy their replacement blades, which is where the company makes its profit.

It's true that big companies can find profitable loss-leaders where small companies can't -- though this isn't always true; my startup uses a loss-leader B2B product to unlock a more attractive B2B2C offering.

I think what you're observing is that monopolists tend to be more able to use loss-leaders, since their monopoly power gives them the ability to charge a premium on their monopolized good(s), which would increase the scope of profitable loss-leaders. However loss-leading is certainly not a monopoly-only strategy.

Re: The Anti-Amazon Alliance

#132

Post by ignoramous » Tue, Apr 28, 2020, 5:39 PM UTC

lostmsu wrote: post #28

marban wrote: post #9

Meanwhile: https://techcrunch.com/2020/04/28/shopify-launches-shop-a-ne...

TechCrunch started highjacking the back button :/

I almost always reach for the reader mode button. Then there are mirrors like these that clean up the clutter: https://outline.com/TxScD5

Re: The Anti-Amazon Alliance

#133

Post by schnevets » Tue, Apr 28, 2020, 5:42 PM UTC

MattGaiser wrote: post #93

Most non-Amazon businesses are mediocre. Most grocery stores still don't have online ordering. Years, and years, and years, after Amazon entered the field, the other grocers have just decided to lie down and die. Still waiting for Chapters (a bookstore in Canada) to start sending me reading good reading recommendations. Still waiting on VISA to make generalized gift cards which are not miserable to use. I'm trying to…

My thoughts on declining industries have changed a lot since listening to the Spectacular Failures podcast episode about Toys R Us and learning more about the vampiric practice of Private Equity, where firms like Bain acquire struggling businesses and win regardless of the output. Here's a similar story from The Atlantic: https://www.theatlantic.com/magazine/archive/2018/07/toys-r-...

I'm tired of people lamenting the loss of true retail and blaming disruption for any negative changes in the world. The fact is, entire industries outside of Bezos' world flourished from these failures and continue to thrive as long as Chapters doesn't use big data, Visa doesn't make an intuitive gift card option, and the family-owned grocery store doesn't have software to share inventory online.

Most of the zombie companies had excelled at some point in the past - even a joke company like Sears was once the pinnacle of innovation. At this point I'm just convinced companies that decided to "lie down and die" are cases of competing goals among the decision-makers. Some are too non-confrontational, some are egomaniacal, some stifle innovation, some are too audacious, and lots of executives, board members, and consultants flourish regardless of the result.

The result is an unhealthy economy that is constantly getting conned by those who know how to play the game. But maybe that has always been the case...

Re: The Anti-Amazon Alliance

#134

Post by adamc » Tue, Apr 28, 2020, 5:42 PM UTC

lotsofpulp wrote: post #27

softwaredoug wrote: post #4

As a consultant, I see companies struggling to compete with Amazon (or Amazon-like companies). Most companies struggle for a couple of reasons - They are ego driven, with legacy execs & others relentlessly protecting their status - whereas Amazon is relentlessly data-driven - They have poor incentive structures and are feature factories. They value velocity over outcomes. Amazon, by being more data driven, is focused…

>To compete with Amazon, you have to learn from them, and be prepared to adopt their practices as the new industry norm. Amazon has taught me to go out of my way to buy directly from manufacturer or a reputable retailer that doesn't offer third party sellers on their website. I don't want to save 10%, 20%, even 50% to risk any chance of getting some counterfeit crap. Hopefully, there will be sufficient customers like…

This. Newegg has similarly taught me to select only Newegg as the retailer when doing searches.

Re: The Anti-Amazon Alliance

#135

Post by poxrud » Tue, Apr 28, 2020, 5:43 PM UTC

joefourier wrote: post #85

poxrud wrote: post #67

Earlier quoted context omitted.

>>Amazon is killing video encoding business by selling a negative margin video encoder to sell through AWS compute. What product are you referring to? I'm in this industry and based on my experience their video encoding+storage+streaming offerings are actually higher priced than their competitors. The reason their services are popular is the integration with the rest of AWS (which is true for most of their offerings)…

I often hear this repeated with Amazon, that it's pointless to try to compete with them because they can just undercut you on price, but I have seldom seen any evidence for it. AWS is one of the most expensive cloud/hosting services for compute, data, bandwidth, etc., the products sold on Amazon are almost always more expensive than buying them from alternate sites or directly from the source. The only cheap thing th…

The prices for AWS products only tell a small part of the story. The real costs are in outgoing bandwidth.

Take the encoding example above, you might pay a competitive price for the compute time required to encode, but you'll be paying some of the highest bandwidth fees in the industry if you were to stream out your encoded video to multiple viewers.

Re: The Anti-Amazon Alliance

#136

Post by Mediterraneo10 » Tue, Apr 28, 2020, 5:43 PM UTC

three_seagrass wrote: post #100

subhobroto wrote: post #21

Amazon is successful because they allow people to order cheap consumer goods real fast, sometimes same day and have a great return policy to boot. The typical consumer does not care about "Made in U.S.A" vs "Made in China" vs "Made in Taiwan". They do care whether it's $9 vs $27. The typical consumer does not care whether the workers were paid fair wages and given enough bathroom breaks so as not to urinate in a bott…

Warm and fuzzies go away pretty quickly when you get a counterfeit product. Wal-Mart won the retail game because it won the price war, like you said, but it held the keys to the kingdom for so long because it also enforced a minimum quality standard with suppliers. Ebay used to be inexpensive and widely used until it was overrun with counterfeits and scams. Amazon is on the same path with it's lax counterfeit enforce…

> Wal-Mart won the retail game because it won the price war, like you said, but it held the keys to the kingdom for so long because it also enforced a minimum quality standard with suppliers.

Wal-Mart is nearly just as guilty of selling shoddy items as Amazon. Wal-Mart has struck deals with brands so that lesser-quality versions of popular products are shipped to Wal-Mart stores than to more upscale shops. These lower-quality versions are not clearly marked as such, and it is difficult for the average consumer to notice how the plastic molding is thinner and less durable – they will only find out when it breaks on them.

Re: The Anti-Amazon Alliance

#137

Post by emilecantin » Tue, Apr 28, 2020, 5:45 PM UTC

Lately (since the start of the COVID crisis), I find Amazon has become much worse. 2-week deliveries instead of 2-3 days, prices that are way too high, a lot of items out of stock, etc. For instance, I was looking at a cordless drill, and it was twice the price of Home Depot.

Maybe Amazon will just fall on its own at some point.

Re: The Anti-Amazon Alliance

#138

Post by nostromo » Tue, Apr 28, 2020, 5:47 PM UTC

xenocyon wrote: post #61

softwaredoug wrote: post #4

As a consultant, I see companies struggling to compete with Amazon (or Amazon-like companies). Most companies struggle for a couple of reasons - They are ego driven, with legacy execs & others relentlessly protecting their status - whereas Amazon is relentlessly data-driven - They have poor incentive structures and are feature factories. They value velocity over outcomes. Amazon, by being more data driven, is focused…

These sound like platitudes. And in particular the claim of Amazon's tremendous autonomy for workers doesn't even ring true to me (though I could be wrong since I'm basing this on anecdotal conversations with Amazon engineers). I think there are real, deterministic reasons why Amazon is successful (other than its unscrupulous practices) but I'm not sure your comment adequately covers them. It's hard to make these det…

I agree. These are consulting platitudes and can be ignored. The real reasons Amazon is successful:

* They ship super fast

* They sell almost everything at reasonable prices

* They have more user-provided content (reviews, photos) than anyone

Re: The Anti-Amazon Alliance

#139

Post by bsanr2 » Tue, Apr 28, 2020, 5:47 PM UTC

partyboat1586 wrote: post #125

bsanr2 wrote: post #84

Earlier quoted context omitted.

I think the idea that Jobs had "great taste" is a myth. What he was good at was implementing an all-encompassing product strategy that established Apple products as status symbols. I don't think it's an accident that Apple "arrived" in the late 90s. Why? Because that's when their experience with education enterprise could be combined with the broad marketing lessons to be learned from products like Air Jordans. Apple…

Why then in other markets are there multiple premium brands? Say for example cars, Lamborghini, Ferrari, Porsche... There is no Apple in that market. Or take watches as another example, so much choice. Apple is the only company that has nailed the premium computer. Why?

I don't agree that there aren't multiple premium brands within the phone, computer, and media player spaces, but humoring you, I would say that platform lock-in is a factor. If I sell my Ferrari to buy a Lambo, I don't have to find new gas stations and roads to use.

Re: The Anti-Amazon Alliance

#140

Post by scrimps » Tue, Apr 28, 2020, 5:47 PM UTC

astrea wrote: post #121

BoysenberryPi wrote: post #59

People in tech vastly overestimate the amount of people who dislike Amazon. Your Average Joe could not be happier with Amazon and does not give a second thought to their business practices or worker treatment.

Breaking news: people are generally selfish.

Businesses hate competition.