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When it comes to online retail stores, people keep mentioning two names: one that we will circle back to in a few paragraphs and Amazon.com (NASDAQ:AMZN).

One of the biggest pieces of news that has investors of Amazon particularly interested is its acquisition of Avalon Books, adding a little over 3,000 new book titles for its book stock. While not immediately moving it to its Kindle platform, the books that the company will publish will be available in print for sale in bookstore. This is a big step since it is trying to compete in a market where you never know where a bestseller is going to come from. Investors should keep an eye on this to see whether any of the new titles can bring more revenue into the company.

Why should investors be worried about the revenue of all things? Because Amazon has recently issued a lower than expected earnings guidance for the second quarter of 2012 and there are concerns over the revenues as a result. As a result, it is trading lower than anticipated. However, experts just cannot seem to agree what to make of this. There are analysts that say it is a must buy and then there those that contend it was a neutral stock (meaning no visible improvement or worsening conditions, but is, in any case, bad for the company's image).

Despite all of this however, it seems that Amazon still has a few tricks up its sleeve. The aforementioned acquisition has it on a stock watch list along with some of the bigger names in the market. It has also recently received a patent that it applied for in 2008 which allows it the use of technology for "electronic gifting", in lieu of gift certificates or gift cards, something that will help with seasonal purchases for these items and boost its sales in these periods.

In addition, something that might be of interest to investors and other people concerned, Amazon has invested $52 million in air conditioning for its plants after ambulances lined up at one of its warehouses in Pennsylvania, ready to take employees who collapsed from heat. This will go a long way to assuage any employees who might have had complaints and prevented incentive for strikes and work stoppages, which would not help its revenue problems at all.

You remember the other big name we were going to talk about. Well, now would be a good time to mention that some people are of the belief that eBay (NASDAQ:EBAY) is the better buy in online retail. Why not, when it offers up services like offline PayPal purchases with stores? Not just any stores, mind you, but huge retail outlets like Abercrombie & Fitch (NYSE:ANF), Foot Locker (NYSE:FL) and JCPenney (NYSE:JCP) to name a few. It is making huge strides to have PayPal rival the likes of credit card moguls like Visa (NYSE:V) or MasterCard (NYSE:MA), which can only be very good news for it because it will allow people to make purchases on PayPal without being online and making it more accessible, which plays to eBay's advantage, naturally.

One of its former employees, Mr. Daniel Kao, has just been named the Chief Technology Officer of Vipshop Holdings (NYSE:VIPS), a leading online discount retailer in China. It is a big step in the right direction for Vipshop Holdings, since Kao was a software engineer and software development manager for eBay for seven years, and has an understanding of how exactly to make the company site work better for its needs. This development will likely have a positive impact on Vipshop stock.

While on the topic of China, it might be a good time to note that not everything is going its way. Companies like E-Commerce China Dangdang (NYSE:DANG) fell hard as the whole industry fell down in a heap. Investors in these companies might quickly want to jump ship before the whole thing collapses and they are taken down with it.

Another company that is not really doing all that well is Systemax (NYSE:SYX). It has just been downgraded from buy to hold by TheStreet Ratings due to the unimpressive growth in net income and a general disappointment in the stock's performance. This is to offset its solid financial position and reasonable debt levels, which is somewhat understandable when you consider how meaningless it can be to have a lot of money and nothing to do with it. This seems to be a reasonable downgrading and investors would be wise to heed the report.

As you can see, only eBay stands a chance of bringing Amazon down. However, it is going to have a tough time if Amazon can do things like collect taxes on sales in New Jersey and get state financial help if it opens a warehouse in the state. This, as well as hiring a really big name in the writing industry, Clive Barker, to rewrite Zombies vs. Gladiators for Amazon studios, which could be truly huge for its consumer base.

So does that mean that you should just disregard eBay and go to Amazon instead? Well, the advice from some analysts would be to do the opposite: sell off Amazon and move somewhere else. All of the incentives it has received in the past are slowly beginning to fall off and that means that Amazon might just curtail in growth enough that the stock falls and investors are going to feel unrewarded.

My final assessment: abandon the Amazon ship. It is not worth staying on if the most exciting thing to happen to it is that it buys a ton of books. Unless they can amaze people by pulling a major trick, investors should start to slowly sell off their Amazon stock while they can get something for it. I also recommending steering clear of E-Commerce China DangDang and Systemax at this time. I have much more confidence in recommending eBay, and even Vipshop.

Source: 3 Online Giants That Could Plummet By 2013