Amazon’s losses were almost $400m down on last year. The retail giant’s third-quarter financial earnings report showed dramatically increased sales, but surprise losses of over $400m. It got me thinking. Why do people buy from Amazon today?
Two reasons spring to mind:
1. Convenience: customers know they will find everything they need, at such a good price that they don’t have to spend hours comparing.
2. Reliability: a fast delivery and easy returns process.
In short, Amazon is easy and you know you won’t be disappointed. It does exactly what it says on the tin. Differentiation is great, but it’s only necessary in a few relevant aspects.
Being the first to do “XYZ” may be cool, but online shopping has grown up and today people don’t buy from Amazon because it’s cool – but because it’s convenient and reliable.