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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 222.69+0.1%3:59 PM EST
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To: GST who wrote (79054)9/30/1999 11:16:00 AM
From: Eric Wells  Read Replies (2) of 164684
 
GST - I have to disagree with your assessment of the potential impact of Amazon's zShops. Companies like Starbucks - specifically medium and large sized companies - would derive no benefit from zShops. Starbucks will want to drive customers to its own site (www.starbucks.com) to purchase products - this is necessary to maintain its brand image.

Note that the e-commerce aspect of a web site is only a small part of a company's overall web strategy. I have no idea what Starbucks spent their $100 mil on, but I would guess that only a fraction of the money was used to build the database and write the credit card transaction code to sell products online. I imagine a lot of the money was spent on research, marketing... and consultants. Either that, or they had someone lacking technical competency building the site for them.

All this being said, zShops does provide a very attractive prospect for small businesses. I view the effort as being sort of an "Extended Ebay" - except that sellers sell at fixed prices (as opposed to bid prices). I think there will be a lot of competition in this area (there already is) and I don't believe it will generate enough revenue and profit to pull Amazon back on its feet (from an income statement perspective).

I have no position in AMZN as I type.

Thanks,
-Eric Wells
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