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Is Amazon Good for the Online Marketplace?

28 February 2016

From Slate:

Amazon isn’t the price king. It’s the trust king. And that trust was earned.

When everyone else was inflating shipping charges to give the illusion of lower prices, Amazon was charging actual shipping costs and passing its negotiated rates along to the customer instead of pocketing the difference.

When everyone else was charging restocking fees or making customers jump through hoops to return unwanted items, Amazon made it easy to return items through automated processes.

. . . .

Amazon is No. 1 because consumers choose them consistently. It has nothing to do with price or market size. The products on Amazon are often available elsewhere for less, and it’s just as easy to type in a different URL when you want to buy something.

As for their size, consider that total e-commerce sales are $1.5 trillion annually. Amazon makes about $100 billion. That means their share of all e-commerce revenue is only 6.6 percent. They’re far from a monopoly.

Link to the rest at Slate and thanks to Dana for the tip.


16 Comments to “Is Amazon Good for the Online Marketplace?”

  1. I’m an Amazon Prime member but, beyond that, I have a very strong preference for shopping Amazon.

    One reason for this that I’ve never seen discussed is trying to limit the risk of identity theft.

    Unlike a stock portfolio, where identity theft is the concern, you don’t want to diversify the companies you’re involved with–you want to concentrate your dealings with as few as possible.

    For someone like me who is going to shop online–and who doesn’t want his credit card information available very many places–it makes sense to pick a primary (even a single) vendor who’s likely to withstand the constant onslaught of cyber attacks.

    If anyone possibly fits that description, it’s Amazon.

    • Ugh! Not just online, but b&m stores are vulnerable, too. The Target fiasco comes to mind. At least Amazon takes the threat seriously instead of chalking it up to “the cost of doing business”. Another example of Amazon’s excellent customer service.

      • Home Depot got hacked, too.

      • My wife’s debit card was frozen last week due to a hack at Macy’s. I have reduced my online exposure to Amazon and Steam (for my 17 yo twins). And I don’t let Steam store my card info.

    • I never even thought of the security aspect. I agree, I think Amazon is making sure our stuff doesn’t get stolen.

      Unlike the IRS.

      I shop with Amazon because they really don’t hassle you about returns. I know that if I have a problem, Amazon will take care of it. Can’t say that about other companies.

    • I’m with Ryan. That’s exactly why I try to limit my online shopping to Amazon.

    • Amazon polices their third-party vendors, too. I speak from experience.

      I inadvertently ordered an item. Surprised when it arrived. Made arrangements for return and returned the next day. Within an hour after I gave the item to the shipper, my bank account was credited with the money (I used a debit card).

      I think the motto for Amazon customer service is (or should be) ‘No worries, mate. She be right.’

  2. Okay guys. I need a little advice so I’m dropping my request in this post about Amazon because it involves Amazon. My dad sent me this message today. One of his books has selling very well due to some viral posts online but he’s been receiving complaints from Amazon customers about the quality. I blame the publisher, of course…

    “Thought you might be interested in a dispute [my agent] and I are having with Perseus and Amazon. A reader wrote me and complained about the copies of [my book] he ordered from Amazon. I happened to have ordered 4 from Amazon myself, just to get them quickly for a gift. Both of us received abysmal copies – faded, miscut, printed on inferior paper, with faded illustrations printed at maybe 100 dpi.

    [My agent] and I complained to Perseus and they said they were sorry, but sometimes Amazon PRINTS THEIR OWN COPIES if the publisher hasn’t supplied enough!!!!! Perseus said we can opt out of that if we want. WE WANT!

    So, what I’m hearing is that the publisher authorized these POD copies. How/why would a publisher be paid for these copies? And why are the copies cr*p? I don’t understand. He’s handling this, of course, but through his agent… who is not familiar with modern publishing. Something doesn’t smell right. Is this a normal thing? I’d think a publisher would expect a certain standard to be maintained (*snort- I just made myself laugh) and not allow poor quality copies with their name on it.

    • Perseus has been up for sale for a while now and employees are posting on Glassdoor that pay is low, software and hardware is out of date, and management is confused. Maybe they are cutting corners on their POD production and blaming Amazon. Would be interesting to get Amazon’s account on this.

      • Perseus had a deal to sell itself half to Hachette and half to Ingram. Hachette would buy the IP side and Ingram the printing and distribution side. It fell apart after Ingram took a closer look at the facilities during due diligence.


        Amazon does use the Createspace facilities for POD of some tradpub titles but unless we hear of similar tales from Createspace customers I would be more inclined to believe the defective copies came from Perseus.

        Just me, of course…

        • Thank you for the information!

          I finally managed to use some decent keywords in Google and found out that Perseus owns Constellation Digital which is an e-book/POD distributor for “independent” authors. Why would they use Amazon if they have their own POD company? As well, I haven’t heard bad things about Createspace when it comes to quality of the print copies and, from my experience, Amazon would be right on it if there were issues.

          I’m waiting for things to shake out. I’ll update.

          • I’ve been carrying around the proof copy my first paperback from CreateSpace in my backpack along with sticky tabs and a highlighter for the last three months. I’ve been impressed with the abuse it’s taken. Any mistakes I’ve found so far are solely mine.

          • I’ll second that my Createspace paperbacks are very nice. As good as or even better than NY published books.

            Perseus’s story sounds very fishy.

            • I’ve currently got 18 titles in paperback through CreateSpace. None of them have suffered from the problems that your dad describes. I’d be very surprised if those shoddy POD editions of his book came from CreateSpace.

  3. Is Amazon good for the online marketplace? Better than Slate is for the blogosphere, that’s for sure.

  4. Is Amazon good for the online marketplace?

    I thought Amazon was the online marketplace.

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