“Amazon, the retailer and entertainment company reported on Thursday that is lost 95 cents a share in the third quarter, compared with a loss of 9 cents in 2013.”
Amazon fails to realize its goals to make more profit this year. Instead, its stock is falling. What cause Amazon’s decline? We could analyze from internal and external factors.
Unlike eBay that includes variable categories of goods, Amazon mainly focuses on selling books and electronics and provides fewer commodities such as clothes and shoes. Furthermore, Amazon charges higher price compared to other similar website. Less diversified goods and relatively high price are weaknesses for Amazon.
With more and more online stores such as Alibaba’s Taobao developing, Amazon has more strong competitors. Also, many brands tend to have their own official website to sell goods as a way of improving customer relationship. Normally, consumers prefer to buy goods on the official website since many companies provide all their goods on their own website but website like Amazon only provide part of goods of those brands.
Amazon is trying to improve by overcoming internal weaknesses and looking for new way to compete with counterparts. On the one hand it enhances music and video and music service to attract more customers. On the other hand, Amazon plans to open its physical store, which would be an advantage over its competitors.
Resource and Picture from http://www.nytimes.com/2014/10/24/technology/amazon-loss-quarterly-earnings.html?_r=0