Were Amazon's (AMZN) market share gains partly responsible for Google's (GOOG -8.4%) Q4 miss?...

Were Amazon's (AMZN) market share gains partly responsible for Google's (GOOG -8.4%) Q4 miss? Henry Blodget thinks it's possible. Compared with other online retailers, Amazon buyers are more likely to go directly to its site, cutting Google out of the process. Moreover, Amazon has begun selling ads on its product search pages, a move clearly aimed at Google's ad dollars. (more) (transcript)

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  • Joe Eifrid
    , contributor
    Comments (358) | Send Message
    I am curious how the loss of Target affected AMZN this holiday season. TGT had problems with the initial launch of the go it alone website, but I think they had those bugs fixed by the holiday selling season. Not only did AMZN lose TGT, but they also gained a competitor - TGT. This season the moat around AMZN did not seem so wide to me. I got a feeling that what affected GOOG may also play on AMZN. Online buyers may be straying away from the mothership(s).
    20 Jan 2012, 06:22 PM Reply Like
  • krk
    , contributor
    Comments (871) | Send Message
    It is Amazon who could get bruised by Google eating into its lucrative fat tail Marketplace platform, if only Google decides to capitalize upon the discontent and natural suspicions among Amazon's vendors by developing a well-rounded marketplace platform.
    "Internet Retailer: The Risky Rumba With Amazon
    Is there more profit or peril in embracing the world's e-commercepowerhouse?"


    All that an Online Marketplace ideally needs is a popular, agnostic, unconflicted, neutral platform for display advertising, payment processing and fulfillment. The first two, advertising and payment processing Google already does (Google Checkout). And, watching UPS air their "We are Logistics" TV commercials during primetime leads me to believe that UPS views logistics and fulfillment as natural extensions of its turf and wants to be a player and could be a natural, non-competing partner to Google to complete the third component of its Marketplace platform.


    And Brands might love to have a "disintermediating" platform from a non-merchant like Google, as I don’t know what added value online merchants like Amazon offer, which are simply discounting channels causing value erosion for brands like Samsung, Sony etc. Apple’s genius has been as much in their design as in their success in preventing value erosion by being able to maintain pretty much the same pricing through any channel. All that any Brand needs is a controlled B&M “showroom” experience akin to the coming Apple Stores within Target and logistics and payment processing partners.


    Google has the scale and resources to do it and should leverage and diversify out of it single pony search & adwords business model which I think will erode over time with developments like the rumored Bing/Facebook integration and ads being served thru apps and directly to devices (example Kindle special offers ebook reader) etc.
    22 Jan 2012, 12:32 AM Reply Like
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