ChannelAdvisor

Amazon formally announces new Webstore (Vitamin C)

We had a bit of a scoop here in early March when we detailed what we were hearing about Amazon Webstore from retailers.  Today, Amazon has formally announced the offering and opened a full website at webstore.amazon.com with full details about the offering.   In this post we'll cover some of the new information and speculate what the new webstore means for the e-commerce space.

Impressive launch customer list

For launch, Amazon webstore has a very impressive list including many name brands:

• Timex
• Creative Labs
• Atlantic Records
• Samsonite
• Boeing
• Martha Stewart
• Sony music

Pricing is revealed!

There has been a lot of speculation on the pricing of the store.  Amazon's first store was very over priced at > 2% with an additional payment processing fee.  Amazon has revealed the pricing today and this graphic does a good job of summarizing things. Interestingly, the pricing depends on which Amazon services you use.  If you utilize both FBA and sell on Amazon, you get the biggest discount, with the least discount for someone that doesn't use either amazon service.

 

Note that these prices do not include payment processing which is tiered by sales volume and if the customer is registered with Amazon or not.  Payment processing ranges from 2.9% on the high end (well 5% for items < $10) to 1.9% on the low-end.

It's interesting to see Amazon cut fees to the .7%-2% range and this range is well beyond what we were hearing prior to today's 'reveal'.

What is webstore and a real-world checkout example

When I mention this new store, many analysts and retailers have a hard time understanding what it is.  It is essentially a 100% stand alone store.  It's not like Target.com where you know from the look and feel, and especially checkout, that this is an Amazon-cloned experience.  If you look at any of the sites I highlighted above, aside from this blog, you wouldn't know they are Amazon-technology based stores.  

The only time you get a hint the store is affiliated with Amazon is at checkout (and some have even customized this to be less Amazon flavored). For example, here is a screen shot (click to enlarge) of a checkout from shoplift.com (an Amazon webstore).

 This is actually similar to any CheckoutByAmazon (CBA) integration, but with a little more flare around the bottom 'safe.secure.reliable' band at the bottom there.

Speculation on webstore impact on e-commerce ecosystem

In the last webstore post, we segmented out the e-commerce platform players into Enterprise software, enterprise services, cart software and SaaS solutions.  

This offering clearly is in the SaaS solution camp, but seeing the launch sites and based on what we're hearing, Amazon could actually be using this offering to go after more of the GSI (NASDAQ:GSIC) and Digital River (NASDAQ:DRIV) players. 

Here's some thoughts on what makes me lean that way:

• Many of the launch partners are 'manufacturers' (or vendors in retailer-speak).  This is an area that is coming on-line in record numbers to establish a more direct relationship with consumers.
• Both Digital River and GSI are chasing this market opportunity. Digital River is focused on Consumer Electronics (CE) vendors (like Creative Labs) and GSI has had success with apparel manufacturers (No big Amazon wins there....yet).
• Amazon has created a more 'Lego block' approach where the manufacturer can take down store, FBA, and selling on Amazon.
• As the largest internet retailer, Amazon has a lot of leverage.  For most manufacturers, they are the largest online channel already.  Amazon could (if they want, no idea if they are doing this), leverage that buying arrangement in myriad ways to drive adoption of the platform.  This is a lever that neither GSI or DRIV have at their disposal.

The only chink in the armor with this strategy is that most online retailers have a healthy respect (a.k.a. fear) of Amazon and I'm not sure how many manufacturers are going to want Amazon knowing so much about their direct-to-consumer strategy and results.  However they do have a growing list of name brands that don't seem to be concerned.

What do you think of the offering? Sound off in comments.

SeekingAlpha Disclosure - I am long Amazon and Google. eBay is an investor in ChannelAdvisor, where I am CEO.

Great blog post - Amazon vs. Google...

There's lots of buzz in the media about the "Marketplace War" between eBay and Amazon, the "Search War" between Google, Bing, Yahoo! and the "Mobile War" between Google and Apple.

Today, serial entrepreneur Chris Dixon has a blog post that shines a light on the real potential loser from Amazon's dominance - Google.

We've long thought at ChannelAdvisor that it is interesting that Google has taken their eye off of the core business.  It's somewhat reminiscent of eBay's focus from 01-08 on all things 'not eBay': China, Skype, etc. which left the core marketplace business atrophied and open to competition from Amazon.

Google gets approximately 40% of its revenue from the 'retail' vertical, yet since Google Checkout (atrophied), hasn't done anything to really innovate in the vertical.   In the meantime, Amazon has created the best product search engine which is gobbling up share hand over fist.  Sooner or later consumers will stop using Google to start the search, and just use Amazon.

A couple of data points indicate this is already happening:

• Amazon's revenue is growing faster than Google on a y/y basis
• Amazon's traffic is growing faster than Google's
• For many customers that are on both Google (Adwords) and Amazon, Amazon's same-store-sales are growing much faster than Googles.

Perhaps with the appointment of Stephanie Tilenius as VP of e-commerce at Google, they realize this is a potential problem for them.  Stephanie gave a talk at ChannelAdvisor's Catalyst recently and hinted at some big things to come.  She'll be speaking in early June at the Internet Retailer Conference and Exhibition (IRCE for you home gamers) and the title of the talk is "Google enters the e-commerce arena".

We'll be live blogging, so stay tuned.

SeekingAlpha Disclosure - I am long Google and Amazon. eBay is an investor in ChannelAdvisor.

Buy.com is snapped up by Rakuten

Over on sister-site, eBay Strategies, we have details of an acquisition that could shake up the online marketplace world for both eBay and Amazon.

Amazon Webinar tomorrow - advanced topics

We have historically done a bunch of what I would call 'Amazon 101' webinars for folks just looking at the platform and wanting to get started.

Tomorrow we are hosting a complimentary Amazon oriented webinar that is more of a 201  -you're on Amazon, things are cooking, but you want to take it to the next level.  Many sellers feel that once their products are on Amazon, you can 'set and forget'.  That's one approach, but like any channel, Amazon has many second and third order things you can do to continue to boost sales.  For example - are you doing the right things for Amazon SEO (optimizing within the Amazon search engine), are you merchandising your products, are you being competitive with pricing, are you considering leveraging FBA and of course, what are you doing to own the infamous buy-box?

We'll be covering a lot of these more advanced topics and of course will have Q+A with a group of folks that know more about the ins and outs of selling on Amazon than anyone outside of Amazon's four walls.

The webinar is tomorrow, May 20th at 2pm ET and you can register here.