The Information features a fascinating article on how, perhaps for the first time in quite some time, Amazon’s primacy as the go-to place for e-commerce is being challenged by the likes of Temu and Shein. If you’ve never heard of Temu, you either didn’t watch the Superbowl (where they ran three ads) or you live in a cave. Not that there’s anything wrong with living in a cave… or not watching the Superbowl, for that matter.
I wonder what and when would be a margin pressure due to low priced items on Amazon's retail business due to this decision? Or would the BuyBox simply is a real estate for Amazon to put its own Amazon Basics products more prominently?
I really liked your take on how Amazon is adapting amidst increasing competition. I wonder if (or maybe how much) this "second BuyBox" will actually impact customers' decisions. It doesn't surprise me that Amazon self-preferences, but the quality of a company's own products definitely contributes to the company's validity and consumers' trust (e.g. Costco does an excellent job with their Kirkland Signature). Great insights as always.
I wonder what and when would be a margin pressure due to low priced items on Amazon's retail business due to this decision? Or would the BuyBox simply is a real estate for Amazon to put its own Amazon Basics products more prominently?
Professor Allon,
I really liked your take on how Amazon is adapting amidst increasing competition. I wonder if (or maybe how much) this "second BuyBox" will actually impact customers' decisions. It doesn't surprise me that Amazon self-preferences, but the quality of a company's own products definitely contributes to the company's validity and consumers' trust (e.g. Costco does an excellent job with their Kirkland Signature). Great insights as always.