E-commerce giants like Amazon are revolutionizing the world and our buying habits. Their web pages present to us all in a simple, comfortable, and convenient way, making us more and more used to the idea of its uniqueness and irreplaceability. But is all that glitters gold? Behind such ease and simplicity of our lives, is there may be a price that we will have to pay in the future? The question we should start making is how these marketplaces are transforming the world and ourselves. Is it right to ask if there is a dark side to Amazon and all the other e-commerce giants?
The e-commerce market is growing globally, but in China, the expansion is even more remarkable. Motivated by low prices and convenience, Chinese buyers have fully embraced online shopping in a country where Amazon is the big players. Yet the focus is often on the world’s largest Amazon. The media likes to present these two as rival contenders engaged in a global showdown. However, the reality is far more complex, and Amazon quite different. Each has unique features and employs different business models, so it’s important to understand their similarities, differences, and what makes them tick.
In many ways, Amazon.com is perhaps the company that is most closely tied with the E-Commerce phenomenon. The Seattle, WA based company has grown from a bookseller to a virtual Wal-Mart of the Web selling products as diverse as Music and Hardware. The company has also grown at a tremendous rate with revenues rising from about $150 million in 1997 to $3.1 billion in 2001. However, the rise in revenue has led to a commensurate increase in operating losses leaving the company with a large deficit. The company did make its first quarterly profit of $5.8 million in the fourth quarter of 2001. But, this was dwarfed by large cumulative losses.
The story of the formation of Amazon.com is often repeated. It is also known as an urban legend. Jeff Bezos was a founder of a company. Also, he has done a computer science and electrical engineering who was a graduate from Princeton University. Bezos had moved to Seattle after resigning as the senior vice-president at D.E.Shaw, a Wall Street investment bank. He did not know much about the Internet. Not knowing much more, he plunged into the world of E-Commerce with no prior retailing experience.