Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Glenn D. Rudolph who wrote (89946)	1/6/2000 9:55:00 AM
From: i-node	Read Replies (2) \| Respond to of 164684

There is no such thing as a loyal customer base in retail. Ask Kmart, Sears, Penneys I respectfully disagree. All of these companies had loyal customer bases over extended periods of time. However, they failed to adapt to a changing market environment, and you cannot expect loyalty to overcome that. If AMZN builds a loyal customer base then fails to adapt as the environment changes, THAT's a different thing...

To: Glenn D. Rudolph who wrote (89946)	1/6/2000 12:19:00 PM
From: Rob S.	Respond to of 164684

Yes, and you can add to that list many other regional and specialty retailers. Amazon has done a brilliant job of taking advantage of the tide of interest in the Internet. Whether this is just a fad or a viable long-term "branding strategy" remains to be seen. During their time, analysts expounded about how J.C. Penny's and other "brand names" of retailing had clear advantages over competitors. Their retailing efficiency was touted to be the among best in the business and their sales format was viewed as just what customers wanted. The problem with success in retail is that much of the ingredients are easily understood and duplicated. However the "branding strategy" plays out, the assumption that a well recognized name on the Internet and huge sales will inevitably lead to huge profits is basically flawed. As I posted over a year ago, the Internet is the perfect vehicle for creating a new retail paradigm: push-button comparison shopping. Mass merchandise retail has always been a cutthroat business. Customers can always go down the street to buy from a competitor that offers a bit lower price. On the Internet, going "down the street" is only a few clicks and minutes away and shopping comparison tools and advisory services make selection even easier. Remember what the analysts were saying two years ago? Something like: "The Internet is much more efficient than bricks and mortar retail. Online retailers like Amazon will be able to undercut the traditional merchants and make huge profits." That "analysis" was not just nearsighted but plain dump. The grossly flawed assumption that electronic order processing and fulfillment would give online retailers massive advantage over others ignored the fact that the new Internet media causes a "paradigm shift" from broadcast centric sales process to a consumer centric, comparison driven media. Analysts ignored substantial academic and industry studies that clearly brought the anals large margin assumptions into ridicule. But the analysts and bulls were right about one important thing: Internet stocks would move up to exceed what seemed like wild price targets. Even though increased targets were often accompanied by huge increases in loss projections, the public bought into the growth for growth sake argument with wild enthusiasm. The growth of the media itself, online investing and broadcast media hype machine have contributed to the bubble. IMO, this bubble is still far from bursting. The current correction may spell a top in the Internet sector darlings or it they may go on to new highs around the time of earnings reports. By this summer the darlings will likely once again submit to the summer doldrums and see seasonal lows. But I think they will remain wildly attractive to the public.