#amazon

Jason Feifer:

Chaim, it turned out, was Chaim Pikarski, an Orthodox Jewish man with a wispy red beard who seemed amused at my attempt to understand his business. He also knew his Hipe speaker would appeal to me, because that insight—knowing what people are searching for on Amazon—is at the core of what he does. He has an entire team of people who read reviews on Amazon, looking for moments when people say, “I wish this speaker were rechargeable.” Pikarski then makes a rechargeable version. Hipe exists, in essence, because enough people think like me. It’s a profitable trick: C&A Marketing does “in the nine figures” in sales every year, Pikarski says, and grows at about 30% annually.

Market-research-via-Amazon-customer-comments-as-a-business. Fascinating.

Eugene Wei:

One popular thesis among Amazon profitability skeptics is that Amazon can’t “flip a switch” and become profitable. The most common guess as to how Amazon flips the switch is that it will wait until it is the last retailer standing and then raise prices across the board, so Amazon skeptics argue against that narrative possibility.

But “flipping a switch” is the wrong analogy because Amazon’s core business model does generate a profit with most every transaction at its current price level. The reason it isn’t showing a profit is because it’s undertaken a massive investment to support an even larger sales base. How does Amazon turn a profit? Not by flipping a switch but by waiting, once again, until its transaction volume grows and income exceeds its fixed cost base again. It can choose to reach that point faster or slower depending on how quickly it continues to grow its fixed cost base, but a simple way to accelerate that would be to stop investing in so many new fulfillment centers. 

Right. It’s actually more like “not flipping a switch”.

John Biggs on the new Kindle Fire HDX:

Amazon has also added Mayday, a 24/7 customer support solution that allows you to ping Amazon support people. The service is ingenious. Remote support folks appear in a little video window and can annotate your screen with arrows and even touch UI items. You can mute them so they can’t hear your discussion and block them from seeing your screen if something… untoward appears. It is a free solution to family tech-support problems, and as long as you’re online you can access the service at any time. It is, in a word, amazing.

Just to echo my comments last night, this sounds great for “normals” — it’s a remote, 24/7 Genius Bar. But I find it very hard to believe that something like this can scale. While it’s true that Amazon already has a robust customer support system, I assume these… let’s call them Fire OS Geniuses… are likely going to have to be a cut above typical support (in expertise, demeanor, and presumably pay).

And they’re just one button touch away. What if Amazon sells millions of Kindle Fire HDXs? Are they ready to have hundreds of thousands — or millions — of people clicking that button at any minute? Is there a notion of “Mayday Holding”? 

Of course, Amazon has thought about all this already. And if anyone can scale such a service, it’s them. I do wonder if this just means they don’t anticipate selling that maybe HDXs, at least at first. For now, I’ll chalk it up to Jeff Bezos’ latest brilliant chess move.

J.J. McCorvey:

So is Amazon Freight Services Bezos’s next mission? When I ask, the laugh lines vanish from his face as if someone flipped a switch on his back. He contends that same-day delivery is too expensive outside of urban markets and that it only makes sense for Amazon to deliver its own products within the Fresh program. In China, he explains, Amazon does in fact deliver products via many couriers and bicycle messengers. “But in a country like the United States,” he says, “we have such a sophisticated last-mile delivery system that it makes more sense for Amazon to use that system to reach its customers in a rapid and accurate way.” When I ask whether he would consider, say, buying UPS, with its 90,000 trucks—or even more radically, purchasing the foundering USPS, with its 213,000 vehicles running daily through America’s cities and towns—Bezos scoffs. But he won’t precisely say no.

Greg Bensinger:

The statement, from an Amazon spokesman, refutes a report from website JessicaLessin.com on Friday that the Seattle company has been exploring options to offer a smartphone free of cost.

So let me get this straight: if you legitimately break news, you get neither a link or a citation from WSJ. But if you publish a bunch of “exclusive” bullshit, you get both?

Also not mentioned is the fact that both Lessin and author Amir Efrati used to work for WSJ — which I’m sure doesn’t factor in here…

Will Oremus asks the larger question

In the hypercompetitive online news landscape, is being first and wrong sometimes better for business than being last and right?

It is without question the former.

Sean Buckley:

The Kindle brand and its sunlight-readable e-paper display probably aren’t going anywhere, but the category is edging away from the mainstream. Users demand more out of their devices these days, and slow-refreshing E Ink just can’t cut it for a media tablet. If our predictions for the future need to be grounded in reality, then maybe it’s time we finally put our color e-reader dreams to bed. The technology may eventually find a home somewhere, but at this rate, it likely won’t be on our nightstand.

Are we really ready to fully rule-out Amazon making a move into color e-ink at some point? I’m not sure they will or even should, I just wouldn’t bet against it.

Just because others have tried and failed means nothing. Others tried and failed at eReaders for years as well.

Nick Wingfield on Amazon’s new MatchBook program:

One benefit of MatchBook is that Amazon will let its customers buy Kindle editions of books that they purchased in print as far back as 1995, the year Amazon opened for business. The discounted Kindle edition prices apply to book purchases made in the future on Amazon too.

In an interview, Russ Grandinetti, vice president of Kindle Content, said one of the most common requests Amazon receives from its Kindle customers is a way to build parallel print and digital book libraries, which hasn’t been practical at full retail prices. He said many print lovers will enjoy Kindle features like text searching of books, especially reference books. Kindle fans, meanwhile, still want print editions of books as souvenirs and art objects.

Books as souvenirs and pieces of art. Yep, it has come to this.

mattruby asked:

About a year ago you wrote about the iPad mini fitting into your device lineup. I have an iPad mini and I'm wondering if your Kindle Paperwhite still gets any use. Is it worth picking up a Paperwhite as well? What do you think of the benefits of the Kindle inventory and the lending library vs iBooks inventory?

I do use the Kindle Paperwhite on nearly a nightly basis. After staring a backlit screens all day long, I still find the Paperwhite nice on my eyes before I go to sleep. I’m also about to take off to a beach for the long weekend and it’s definitely great in that setting. 

Overall, the Kindle inventory and lending library aspect seems better than iBooks, but I actually like the look of iBooks better. Kindle has been getting better at removing some of the cruft in the reading experience, but there’s still more to go. 

Long story short: I don’t really use the iPad mini for reading books, but I use it all the time for reading the internet. I use the Kindle Paperwhite for reading books. We’ll see if a retina iPad mini changes that equation.

Larry Dignan:

The advantages to the store-as-fulfillment center plan are that Best Buy can deliver products faster and cheaply. The downside to that strategy is that Best Buy’s in-store inventory visibility isn’t good and the staff may not be as efficient as people in a distribution center.

The conventional wisdom would say that Best Buy’s stores are an albatross around their neck — much like they were for Blockbuster. But what if they can shift them into being more along the lines of warehouses — much like the ones Amazon is trying to build as quickly as possible — for fast local delivery? And what if only a small area of those warehouses were actually a storefront to show off their goods?

This would all take a lot of logistics (and possibly some re-zoning?) but it doesn’t sound like the craziest idea in the world. Again, what if your weakness is actually your strength?

David Streitfeld and Christine Haughney on Jeff Bezos:

But then, few newsrooms have ever been confronted with a new owner whose zeal for disruption is matched by his obsession with tinkering until he gets it right. As Steve Yegge, a former employee, once put it, “He just makes ordinary control freaks look like stoned hippies.” A relevant fact: Mr. Bezos originally thought of naming Amazon “Relentless.”

Mr. Marcus, now the executive editor of Harper’s Magazine, said it all made sense, kind of: “Bezos is fascinated by broken business models. And whatever else you think of newspapers, the business model is broken.”