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Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 244.41+0.6%Nov 7 9:30 AM EST
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To: Bill Harmond who wrote (93412)2/11/2000 6:48:00 PM
From: Greater Fool  Read Replies (4) of 164684
 
>>>marketing and advertising...are much easier to assail than, for example, the manufacturing processes developed for automobiles.

>>How so?

Marketing and advertising are just a matter of spending the money. There's a bit of a management issue, but mostly it's just designing the marketing programs and buying the commercial time and space.

Manufacturing, on the other hand, requires development of a knowledge base and the organization of all the workers and machinery. The Americans had been manufacturing automobiles for decades and still found they had a lot to learn come the 1970s and 1980s, when they were challenged by the Japanese.

Designing a web site and an order fulfillment center and process is no small task, but I believe it's a good deal easier than creating an automobile factory. Plus, web sites are pretty easy to imitate. Not so a factory.

Further reducing the brands' value as barriers: The high valuations of the internet companies have created a huge incentive to invest in new companies, resulting in the staggering venture capital funding of late. This investment allows these new companies to spend freely to attempt to gain market position, forcing the existing players to spend to match.
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