shane wrote:I had a look at the Amazon launch but didn't find to much of immediate interest. The one thing I did order was a GoPro Session4 camera for $189. This is quite a bit cheaper than current local offerings and I wanted to upgrade my head cam to 1080P. These are waterproof without the case, pick up decent audio and small and light enough for what I need. It also arrived within 2 days.
Now I just need to film something again that's worth editing and posting.
I was honestly a little surprised at how uninspiring the local Amazon launch was; I had thought they would have a lot more 'sold by Amazon' products (which are the ones that they can really shaft other sellers with). I suspect they will ramp up their local warehouse offerings as time goes by based on sales (see below).
The following is a bit of a rant from someone who works in the industry and knows more then he'd like about Amazon's hidden face. Feel free to skip to the end if you're not particularly interested in how they work; I'll put a summary there.
For what it's worth I work with a US e-commerce company that sells in multiple marketplaces, including Amazon where we have about 50,000 products. I don't have a high opinion of Amazon (the face they present to the customer is staggeringly different to that they present to sellers).
One thing we see often is that Amazon will look to see how a product is selling and if it becomes particularly popular and they can purchase it themselves they will do so, usually taking the buybox in the process (hence 'ships from and sold by amazon.com'). This may sound like normal business (and it could be argued it is) but when you take into account that Amazon earns 15% (for most categories; I think it's 8% for cameras, drones, computers and the like) for each sale (including shipping) made by marketplace merchants this means basically if Amazon can buy the product at the same price (or less) than you can, you are already at a 15% disadvantage over them. Additionally if you are using their warehouse ('FBA') you also pay them fees for that as well.
The first company to list a particular product has to provide the data to set it up (description, images, barcode, metadata etc etc) so basically that work is done by the seller for Amazon; it costs them nothing. Amazon can then take over the listing and sell the product itself at any time if it wants. So for products that become popular in Australia, they can just wait and see what is most profitable for them and then effectively kick the local sellers off the listing by undercutting them or just forcing Amazon's offering to win the buybox (they aren't physically kicked off, but if a seller doesn't get the buybox most people won't buy from them).
On the plus side unless they can score a really good deal on the product they don't get a lot of advantage by undercutting a seller because they get 15% anyhow, so it's a "win/win" for them.
Combine this with the fact they leased a fleet of jets last year (6 or 7 I think) giving them the ability to ship literally planeloads of goods to international warehouses overnight and they have a pretty sharp edge over local sellers in cases where they can purchase the goods at equal or lower prices (and with most products being made overseas, that's "most of the time").
Put simply one of their strategies is to allow other sellers to build up a product's popularity (taking a large cut in the meantime) and if/when it suits them stepping in and selling the product themselves. I'm not saying this is wrong, just that it's how the marketplace works.
Summary: lots of folks think Amazon appearing locally is a good thing as it will shake up complacent local retailers. This is partly true, but the complacent ones are generally the bigger ones who already have plenty of bricks-and-mortar exposure. It's not nearly as good a thing for smaller online businesses who, often (but not always), do a decent job of competing with the larger sellers because they simply have to in order to survive. Most sales through Amazon will funnel 15% of profit that would have otherwise stayed here into Amazon's pockets (hence offshore). In terms of employment, I can't say how it will work here but in the US they are famous for how badly their workers are treated.
