On Thursday Amazon reported their latest earnings sending the stock to all-time highs after beating analyst estimates for both revenue and profit. But what looks like unstoppable dominance today is instead a decade of investing and execution.
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With every 10x increase in sales volume there are 10x less sellers who have achieved that. It gets increasingly harder to scale a marketplace seller business as sales grow.
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Without much fanfare Adidas appears to have become the most successful direct-to-consumer brand on eBay. The adidas_official seller joined eBay in September 2016, and have since grown to be one of the Top 50 eBay sellers.
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"Winning" brands understand the consumer best and develop the right mix of a logo, pricing, packaging, advertising, promotions, etc. Well, the consumer changed and caused retailers to struggle. The winning mix for brands will have to evolve too.
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In a conversation about the future of retail eBay is rarely brought up. Despite the $36 billion in sales in the US, three times that of Walmart e-commerce, it has lost relevance in the battle to dethrone Amazon. Things continue to be sold in large quantities on eBay, but in a way which often brands don't care about.
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This is the reality of an e-commerce marketplace - millions of sellers on the platform, a million more ready to join, and a short list of top sellers generating most sales. The chance of one of those new million sellers becoming one? Statistically very small.
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Having launched in Australia in December last year, Amazon has now reached 10,000 sellers on the marketplace. In two months the marketplace has doubled in size from 5,000 in January. Amazon Australia is expected to exceed 50,000 sellers by the end of the year.
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A decade ago Amazon made three long-term bets: Prime memberships, fulfillment consistency, and third-party sellers are going to be key. They were the right bets to make.
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Jet.com website traffic declined to 10.5 million visits in February, down from 35.5 million visits in February 2017. That's a decrease of 70% in a year.
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The challenge in creating new products to sell online, be it private-label or new inventions, is capital and time. The capital and time is the cost of creation. The goal is to drive the cost of creation down to zero.
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