Blog

Could this partnership (with Channel 7) be the beginning of Amazon’s push to start increasing Australian Prime Memberships?

There are rumours that Amazon could be flinging open the ‘virtual doors’ as early as October, and this announcement seems to coincide with episodes of The Grand Tour coming to free to air screens on Channel 7 in October.

Prime Membership is a key weapon for Amazon; certainly, in the US, its estimated by Morgan Stanley that 40% of Prime Members spend over $1,000 per year compared to just 8% Non-Prime Members spending over $1,000 per year.

In Europe, Amazon is working ard through advertising to increase Prime Membership.

Buttering up Australians with the demonstration that Prime Memberships offer a whole lot more than just 2 day free shipping makes it a more enticing proposition at $100 per year…

 

Fox Business wrote about the ‘Amazon Effect’ yesterday, noting the destruction of tradition retailer values not just in the United States, but in Europe and beyond.

The author notes that Australia will not be immune with shares in Westfield Shopping Centres dropping almost 19% as tenants are being squeezed out.

Meanwhile, Amazon’s sales are up 17% in the first half of 2017 worldwide.

 

Costco has quietly launched a new online wholesale site for its Australian customers: http://www.costcowholesaledelivery.com.au/ which looks to be set up to take on Amazon head-on before Amazon even opens the ‘doors’.

It could also be a really useful site to help get ungated for various categories like beauty, health and personal care etc – where you can order a few wholesale units from Costco online and use the invoices to show to Amazon to gain access to restricted categories…

Maybe.

I read this great article on the Australian Newspaper today showing this amazing chart which shows close to 10 years of increases in Market Capitalization for the big 4 tech companies in the US.

What’s really interesting is Amazon’s strategy of plowing the vast majority of profits back into growth, which has meant it hardly pays any tax each year as there’s little or no profit. A company with a market cap of $458 Billion dollars not paying tax.

Clever?