Amazon Weekly News: September 26, 2017

Time for the weekly recap of Amazon news! It's always good to keep up with events related to the fast-moving world of the Amazon ecosystem. I select the most important news updates to share with subscribers each week, which you can sign up to receive right here.

 

Amazon on a hiring spree in New York

Amazon is on a hiring spree for 2,000 new positions in both advertising and fashion in its New York City offices, only giving fuel to rumors that NYC is the lead contender for Amazon HQ #2.

One job posting was for a user experience designer for "Amazon Live," a startup that "leverages interactive streaming video to create new shopping experiences for customers."

Few details of what this will look like specifically have been revealed, but we can surmise two things:

  1. Amazon is getting into fashion in a HUGE way (and fashion retailers will be further behind than ever) 
  2. Amazon is getting into video in a HUGE way. IT recently rolled out the ability for brands on Seller Central to upload videos to product pages. I think the video capabilities Amazon has in mind will go far, far beyond what we can imagine right now. And it will undoubtedly have something to do with the Echo Look.

The Amazon flywheel starts to re-form, yet again…

camera.jpg

Kohl’s to accept product returns for Amazon

By aligning further with Amazon, it seems Kohl’s is attempting to attract Amazon’s upper-income demographic into its stores. The logic is that this new traffic could translate into new customers for Kohl’s. Proponents say it takes advantage of both Kohl’s and Amazon’s strengths, leveraging the large portfolio of the former’s stores and the loyal customer base of the latter. It’s a big bet on Kohl’s part, but big bets need to be taken at this stage so Kohl’s can stay relevant.

 

Would a radical partnership help Walmart thwart Amazon?

Amazon has a history of forgoing profit for market share, giving up making significant money until there are few competitors left to compete with it in a given area. In the case of e-commerce, Amazon has grown its market share year after year—so much so that more than half of online product searches in America begin there—only because the hugely profitable Amazon Web Services (AWS) cloud computing division has subsidized it.
 
But what if a challenger emerged and AWS became less of a cash cow?
 
I agree that Walmart and Google have the most to gain right now from joining forces and taking Amazon down a peg or two. As consumer brand advertising dollars shift from Google and Facebook to Amazon, those two incumbents will start feeling more pain. (To that end, where does Facebook sit in this picture?)
 
The Google/Walmart partnership is in its infancy but I wouldn’t be surprised to see this relationship strengthen. Google has the early beginnings of a marketplace, Google Express, but it seems to lack focus or strategy. Walmart could be a quick ticket to achieving broader selection and a reliable fulfillment partner—two big keys to consumer adoption.
 
The other giant competitive threat to AWS is Alibaba Cloud. I definitely see Alibaba as the dark horse coming from behind in this three-man race. Alibaba is big enough and ambitious enough to give all players in this category a serious run for their money.

 

Halloween 2017 shaping up to break spending records

The National Retail Federation predicts Halloween sales to hit a record $9.1 billion this year. According to the NRF’s survey, consumers will spend their Halloween dollars across a variety of outlets, with online being one of the last places they’ll look for deals. 

graf1.png

              Discount stores: 47%
              Specialty shops: 38%
              Supermarkets: 25%
              Department stores: 24%
              Online: 22%

 

Consumers are expected to spend an average of $86.13 each for Halloween, and it’s expected that some portion of this will be spent on Amazon.

 

How to escalate Seller Central issues with Amazon

I cited one of Chris McCabe’s articles in my roundup last week, and here he is again with another great post—this time about how to navigate Amazon’s internal teams within Seller Central. 

Amazon is an enormous organization, and for better or worse, the autonomy each division is given often results in communication silos. It’s often difficult to know how to escalate specific issues. Chris breaks it down nicely in this post.   

 

How will the Sales Tax Amnesty affect brands using FBA?

One of the hot topics for large and small brands alike is how to treat sales through Amazon for sales tax purposes. US companies are generally aware of their sales tax obligations for orders placed by consumers in their own state—but how to handle sales tax for orders placed outside their state when Amazon has a fulfillment center in almost every state?

The new Sales Tax Amnesty program encourages Fulfillment by Amazon (FBA) and other marketplace sellers to collect and remit sales tax, and is scheduled to run August 17 through October 17, 2017. 

tax.jpg

One of our most popular articles was an interview with CPA Mario Lucibello on the subject of sales tax. We plan on having Mario answer questions about this new program on our blog soon. What questions would you like Mario to answer? Please leave a comment below.

 

Another ‘oops’ moment from Amazon’s customer marketing team

Amazon sent emails to a large group of customers that someone had bought an item from its baby registry last Tuesday. It was later reported by Amazon to be a technical glitch—not unlike the recent blunder with customers ordering “free” Echo Dots caused by a discount promotion gone wild. Even Amazon has hiccups.  

 

The Amazon HQ2 Thirst Tracker

Finally, just for a bit of fun. Online pop culture magazine The Ringer has introduced "The Amazon HQ2 Thirst Tracker" to document the outrageous lengths major American cities are going to in vying for Amazon's second North American headquarters.

"The Thirst Tracker will catalog the stunts local officials are using to woo Amazon, explore some of the ways thirst manifests itself in economic development deals, and dig into how Amazon is changing city infrastructure and community planning."
 
So far, top city contenders have offered to change their names and subsidize private-school education for Amazon employees. More than 100 cities have indicated they intend to send Amazon a proposal about setting up shop locally, which means there’ll be a lot of disappointed mayors out there once Amazon makes its decision.


That's it for this week's news update. See you next week!