Amazon "Basics" Well Beyond the Basics: World Domination?

Mish

Amazon keeps expanding its market share. Its "Basics" program and Amazon "Prime" explain why. Time to bust up Amazon?

Quartz reports AmazonBasics is Well Beyond the Basics.

Amazon launched a house brand, called AmazonBasics, in 2009. It was originally a way for Amazon to sell low-cost, generic versions of electronics accessories, like cables and plugs. Over time, Amazon has expanded its offerings dramatically, to the point where it’s difficult to see how the brand still refers to “basic” products.

Quartz trawled through the Internet Archive’s Wayback Machine, which archives websites throughout the history of the web, to see how many products Amazon has offered on its AmazonBasics landing page. The earliest archived result is for Jun. 8, 2013, when 252 products were listed for sale. Four and a half years later, there are currently 1,506 products for sale.

Amazon now offers a private-level version of just about everything it sells, from jeans and bathroom supplies, to bedsheets and lingerie—even books and movies. Amazon is on a path to be able to offer anything anyone wants for the lowest price possible, and with an integrated delivery network, as quickly as possible. Some consider that world domination; others, possibly a monopoly.

World Domination?

Quartz says Amazon just explained how Whole Foods fits into its plan for world domination.

My Take

  1. If it's good for the consumer, then its good for the economy and I am happy with it.
  2. Lower prices and faster service are both good for the consumer.

For the same reasons, we should abolish all tariffs and subsidies effective immediately, whether any other country does the same or not.

Fair Trade is Free Trade

Those who disagree need to consider Reflections and Reader Comments on Free Trade: “China Doesn’t Play Fair!”

Regardless, the same parrots protesting free trade will soon be all over Amazon.

Strange Advocates

Praise for free trade comes (or rather once did), from the strangest of places: Paul Krugman.

For details, please see Fair Trade is Unfair; In Praise of Cheap Labor; Are Bad Jobs at Bad Wages Better than No Jobs at All?

Once Krugman took up the liberal left cause, he lost his mind on many things.

The best position paper supporting free trade that I have seen comes from Ana Eiras, Senior Policy Analyst on International Economics, Center for Trade and Economics (CTE).

I discuss her article in Will Globalization Survive Trump?

Mike "Mish" Shedlock

Comments (21)
No. 1-21
indubitably
indubitably

The United States of Scamazon

indubitably
indubitably

The facts are that Amazon has “purchased” their increase in the gross sales of goods by literally giving product away at an ever-increasing loss — a loss that has now reached nearly 20% across the entirety of nearly thirty billion dollars in goods sold last quarter.

Brother
Brother

True Amazon is only buying market share this is nothing new in the business world. I can't see how it is good for the consumer when it shrinks competition and give fewer choices. Those prices they charge are not the lowest and they are subsidized at a loss.

Mike Mish Shedlock
Mike Mish Shedlock

Editor

Are consumers happy? I would say by the number of Prime members - they are - you still have to shop around

Greggg
Greggg

My wife is a Prime user. Some of the stuff is a better price, but other stuff like Maine Root soft drinks are ridiculous. She always buys the biggest lot until the laundry room becomes crowded with dog food bags in preparation for the Zombie Apocalypse. We do go through a lot of coffee cream and I can't wait till Amazon starts selling it in 55 gallon drums. then I will need to figure out how to replace my 26 cubic foot refrigerator with a walk in fridge. In sum, Prime is nothing more than a Big Box store on line. I'm tired of it...

Liki_Weaks
Liki_Weaks

Sure, right now consumers are happy. But when Amazon is a several trillion dollar monopoly how happy will they be? Not everything is 'good' just because it's cheap. It's a poison pill that will 'getcha' in a few short years. Selling at a loss to get market share is NOT competition but if one can, one does---such is the state of man's dark soul. And therefore some controls are necessary, such as anti-trust, etc. Government can be it's own monopoly and we see how that's working out for us, neh?

bubblelife
bubblelife

Amazon’s stock price = monopoly power. It can crush its
competitors whose cost of capital is much higher.

CzarChasm-Reigns
CzarChasm-Reigns

Shirley, we need a bigger basket to put ALL our eggs in... "Amazon announces new cloud to host 'Secret' government data"

CzarChasm-Reigns
CzarChasm-Reigns

And now, the rest of the story... http://www.wsws.org/en/articles/2017/11/24/amaz-n24.html Repeat after me: The bigger the better. Monopolies are great...

Stuki
Stuki

Unless Amazon builds an army, and (and this many of them do unfortunately seem to be involved in) those who will supposedly be stuck with their “monopoly” prices are disarmed; Amazon will never be able to enforce a “monopoly” on anything. As soon as they are no longer the cheapest/bestest source (due to, for example, no longer subsidizing prices), people will route around them for a better deal.

The problem of “monopoly”, is always and everywhere a problem of government. Not Amazon, not “Corporations” blah, blah. Fascistic governments often do the bidding of the latter, but that still leaves the problem one of fascistic governments; not of corporations.

Reduce government influence and power, while increasing individual ditto (as in spend your money on your guns, not government’s), and you reduce all and any potentially ill effect of “monopoly” as well.

Even empirically (for those hopeless enough to still labor under sufficient physics envy to believe economics is an empirical discipline), monopoly pricing is only evident where laws and governments enforce it: Mainly in drug, housing, IP and “licensed professional” prices. Where government stays out, so does monopoly. Amazon not being different in the slightest.

kram
kram

@Stuki is correct. Despite all the fear mongering about how so-n-so will become a monopoly and will hold the world to ransom, I'm yet to actually see a monopoly do that in the real world. As soon as they start raising prices people will switch. Customers are not fools. When they need to buy a huge quantity to avail of price discounts, they will become mini-distributors, buying one lot and splitting it among friends/family (maybe not in USA because out there practically no one knows anyone else, but surely here in India, people are super-smart because they don't have Govt money pumping their purchases up).

MorrisWR
MorrisWR

Show me a monopoly in the retail sector. The idea is nonsensical, especially on the internet. I can quickly and easily find hundreds of other sites besides Amazon to get goods from. Searching for the best price is so easy it is a wonder that anyone whining about Amazon has not tried. Amazon can lose money to give me lower priced items as long as they want and as long as the shareholders allow it. As soon as that changes, I will happily buy more items elsewhere, as I do when I find better pricing.

Liberaldisdain
Liberaldisdain

Everyone was happy in small town America when Wal Mart came to town. When the company crushed all the competition, shutting down mainstreets and even mid size competitors, it then raised it's prices. Not so happy now. You now have higher prices and zero choice.

Maximus_Minimus
Maximus_Minimus

Amazon and China have the same long term plan. The last thing they want is to give the US consumer a break; only want to break the their competitors. They are an equivalent of a mouse trap.

KidHorn
KidHorn

In the future, people will complain that factory direct web sites cut out retailers like Amazon. Then factory direct web sites will be cut out by materials suppliers. Buy your bulk bag of beans directly from the guy who picks them.

Stuki
Stuki

@Kidhorn

+1
Which is why the valuations of Uber, AirBnB and other explicit middlemen, will be tough to sustain. Their, like Amazon’s, core current advantage is their walled reputation/review databases, enabling them to contribute some implicit trust to transactions between two people with no idea who the other is. But if one assumes a given guy’s reliability and desirability as an Uber passenger correlates with his ditto as a couch surfer and buyer and payer for of whatever Amazon sells; as well as his ditto for being on the seller end; those profiles/histories will eventually find a way move from single service providers, to federated databases accessible by all. Leaving anyone attempting to insert themselves into the value chain as pure middlemen, a bit squeezed.

JeanM
JeanM

It's easy money for amazon. They have the data and knows what the trends are and what's profitable based on other sellers transactions. :) Amazon is sitting on top of a gold mine.

Advancingtime
Advancingtime

With the holidays in full swing, it seems Amazon has made it their company mission to be in our face. Not only that the company has made it their policy to know when you are sleeping, to know when you're awake, to know when you are bad or good through its ties with the CIA and NSA.

Recently Amazon seems to have increased the number of cross-company promotions that offer up Amazon Prime for free in an all gloves off effort to expand their customer base and weasel into the lives of those who have resisted its advances. The article below urges you to loudly just say NO!

http://brucewilds.blogspot.com/2017/11/to-amazon-loudly-just-say-no.html

Advancingtime
Advancingtime

Both Apple and Amazon share an ugly truth and that is their strong ties to America's government has in many ways allowed them to create a persona or facade that far outshines reality. This allows each company in its own way to exploit us while masking the huge amount of income they pluck from our government on all levels. The article below explores how each of these companies feed at the tit of our government sucking in a slew of American tax dollars while displaying tactics that harm the society they claim to serve.

http://brucewilds.blogspot.com/2017/12/apple-and-amazon-share-ugly-truth-they.html


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