At a time when most retailers are uncertain about the future, Amazon is in a category unto itself. Their second-quarter profits were recorded at $5.2 billion, with reported sales of $88.9 billion, up 40% from 2019. It’s no surprise that their e-commerce business grew over 47%, and when combined with net sales from online and its physical stores like Whole Foods, and their expansion plans overseas, world domination may very well be in their reach.
Pandemic aside, Amazon has been playing the long game to secure its future as the retail marketplace. Actively cornering prime retail segments since 2006 with the acquisition of Shopbop, a fashion-forward women’s retailer, followed by Zappos Footwear in 2009, and finally, Whole Foods in 2017. They were also one of the first retail tech companies to offer its exclusive payment feature when Amazon Pay launched in 2007. One might deduce their goal is to become the U.S. version of Alibaba despite its failed attempts at integrating social networking into the Amazon platform.
Bezos’ has reported creating a culture where failure is acceptable and necessary for running a successful business. Henry Ford, one of America’s first business magnates, would have heartily agreed that with every failure comes an opportunity to approach the situation differently. And Amazon is taking a new approach to business. Last year, the company that implemented data-driven marketing strategies to surface new lines of business lines, also scrutinized for distancing itself from its top competitors. Brands like JCPenney and Macy’s, currently on the brink of bankruptcy, are being courted as likely Amazon acquisitions, mainly in part to expand its real estate portfolio. This news is on the heels of months-long talks with the Simon Property Group, well ahead of Coronavirus we might add, to secure their underutilized anchor department stores as part of Amazon’s growing distribution network.
Layering in the Consumer Perspective
Public approval of most occupations has improved since the start of the pandemic, with retail and pharmaceutical industries climbing (17%), followed by food and beverage (23%), technology (28%) and grocery stores (35%). Amazon dominates most of these categories, and there is speculation that a direct-to-consumer prescription drug business may soon follow with the retailer’s 2018 acquisition of PillPack, a mail-order online pharmacy.
Furthermore, 81% of consumers agree that large companies, with resources, expensive infrastructure, and advanced logistics, “are even more vital now to America’s future than before the pandemic.” That sentiment was released even as Bezos appeared before the House Judiciary Committee’s antitrust subcommittee to testify, with several other U.S.-based tech CEOs on their monopolizing status as ’emperors of the online economy.’ And yet, the online economy persists.
How Far Is Amazon’s Reach?
In the National Retail Federation’s (NRF) Hot 100 Retailers, an annual ranking of the nation’s fastest-growing retailers, Amazon closes the Top 5. It ranks third (out of 30) of the top largest American tech companies by market capitalization and makes the Top 10 list of Fortune’s Global 500, which means that they leave no stone unturned.
The latest news from the e-commerce giant: the launch of a Swedish Amazon.se store that will expand beyond Amazon’s presence in the E.U. Its current European marketplaces include France, Germany, Italy, the Netherlands, Spain, Turkey, and the U.K. In addition to a strong economy and retail rebound, Sweden’s location is considered a gateway to the Nordic region, which may prove to be strategic should Amazon continue its acquisition hunt across the globe.