Amazon Will Expand it’s Market Share Through E-Commerce Sales
As the travel industry is feeling the sting of lack of movement - Amazon is capitalizing on the other end of it. With how interconnected the globe has become - logistics and ‘pipelines’ have become sacred. Borderline sacrificial.
Airlines are waiting to receive a subsidy, Amazon is hiring 100,000 in the midst of a pandemic.
Regardless of the ethics surrounding Amazon’s business model - demand has clearly not slowed. Demand will only keep increasing for the near future. E-commerce only makes up 16% as of 2019 of all retail sales in the United States that does not include auto, bars or restaurants.
“Declining consumer confidence, potentially severe retail-traffic declines, and temporary store closures are evolving risk factors that depend on uncertain variables like the geographic spread of the virus and the timing of containment/eradication solutions,” analysts at Cowen, an investment bank and financial-services company. wrote in a note this month.
As of Monday, “hotels have already lost $1.5 billion in room revenue, which equates to one million jobs that have or will be eliminated,” said Chip Rogers, president and CEO of the American Hotel & Lodging Association, an industry trade group based in Washington, D.C. “What we are most concerned about right now is the impact to our employees and small business owners.”
Hollywood has already lost $7 billion, according to most estimates. It could lose another $10 billion over the next few months if theaters stay closed.
The International Air Transport Association has increased its estimate of the potential lost revenue for airlines from the spread of the novel coronavirus (COVID-19) to as high as $113 billion.
With COVID-19 scaring consumers and in some cases forcing governments to restrict gatherings, brick and mortar retail will get hit.
Some of these soon to be empty retail properties could fall to Amazon which allows for it’s online to offline chain to thrive. Not only will Amazon be cementing it’s brick and mortar strategy, but also winning over customers as it expands into areas that previously were not exposed to the brand. The creation of Dent by Amazon and it’s open invitation to Target and Wal-Mart to be part of that online to offline technology sends a clear message that Amazon is looking for expansion in time of uncertainty.
On one hand you have a situation where it forces the average individual to spend more time isolated, behind a device.
On the other hand you have a situation which is scaring investors, cash flow and forcing companies to layoff it’s staff in preparation of a recession.
The first situation; Amazon wins the consumer. For the second situation, Amazon not only wins over potential talent at a discount, but technology that is no longer being valued. Accelerating Amazon’s market share increase through it’s core specialty: the ability to carry on with e-commerce sales.