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: Rob S. who wrote (12920)	8/9/1998 10:13:00 PM
From: Bilow	Read Replies (1) \| Respond to of 164684

Hi Rob S.; Well said! (eom)

To: Rob S. who wrote (12920)	8/9/1998 10:59:00 PM
From: Bill Harmond	Read Replies (2) \| Respond to of 164684

>>Bezo and Amazon.com listened too much to these jackals in pursuing an ad & promotion centric development strategy that has proven to be very costly and is generating diminishing results. After evaluating what has actually gotten Amazon.com to where they are and coming to the realization that Shop Bots and increased competition make an ad-centric mass merchandise approach suicidal, Amazon.com has made the costly acquisitions of PlanetAll.com and Junglee.<< Amazon plans more promotional spending in future quarters, not less. The successful movers in e-commerce have believed that branding matters above all else...that the brand has to be nurtured and its reputation enhanced. Sure word-of-mouth matters, but word-of-mouth only kicks in when successful promotion has launched a quality service, which is exactly what has happened here. That does indeed get back to the early goliaths of Madison Avenue. The CUC division of Cendant is the worldwide leader in electronic commerce (online, but principally telephone) with some 60 million members, and CUC spills more business than Amazon enjoys. A couple years ago I listened to Walter Forbes present at a Montgomery conference his view of how the competitive landscape would shake out, and how he believed that his company would lead and keep the lead. He certainly had his chance. More products and services from more vendors in more categories than any company on earth...with a huge established global membership base, 20x the size of Amazon's customer list today. Perhaps their latest accounting fiasco caused them to stumble with execution, but Amazon has taken all the momentum on the web because they have established their brand better. That didn't happen first through word of mouth. That happened first through marketing and promotion. Don't take Jeff's positive comment about word-of-mouth to mean that he doesn't believe his expensive commerce deals aren't worth the cost. He knows they are, and he won't be abandoning them. That would be suicidal. Rule #1 during a land grab is "Don't give up hard-won territory." Word-of-mouth is just one benefit from the law of increasing returns.