When Wal-Mart walked down the altar, why did Amazon replace it?
First, Amazon’s product classification and storage scale is much larger than physical stores.
Today, there are nearly a hundred categories and millions of items sold on Amazon’s website. In 2014, Amazon sold 2 billion items. Today, it sells far more books than any physical bookstore.
When Apple faced an antitrust lawsuit for collusion with book publishers to raise e-book prices, the company issued a complaint: Why can’t we respond to Amazon’s pricing strategy? In addition, in 2017, Amazon became the largest online clothing retailer, and even American national brands such as Gap are considering placing their products on Amazon’s super shelves. Gap’s CEO (CEO) once expressed his stance. "If we didn’t consider working with Amazon, it would be a mistake."
Second, as the product categories on retailers’ shelves become more and more abundant, the way to manually adjust prices will become more difficult.
In order to determine the price, people need to process massive amounts of data. If someone chooses to do it manually, then even a simple act of replacing the price tag for food cans in all stores will cost a worker for months. However, for Amazon, these workloads are not worth mentioning.
Third, when Amazon and other e-commerce companies promote their pricing strategies to all categories of goods, both for physical stores and for major e-commerce, in order to ensure that they are not defeated in this round of marketing competition, They will compete to incorporate pricing algorithm technology into their own information technology support department, and Amazon’s development in this field can be seen as the epitome of the "big data arms race."
Fourth, online retailers can’t just rely on opening an online store to wait for sales to skyrocket.
Data, especially the ability to master a fairly large amount of data, is the key to success. These online platform companies collect a large amount of personal information data covering all aspects of people’s lives. These data are the value. For these online platform controllers, the ability to control and quickly analyze these personal data will give them a significant competitive advantage.
Fifth, with the rapid development of the computer algorithm software market, Amazon’s competitors are no longer the tellers of manual price adjustments in physical stores. They have to surpass other pricing algorithms of the same type.
Jet.com, an e-commerce site that has received $200 million in financing, claims that the price of its products on its website is 10% to 15% lower than that of Amazon. When companies in the entire industry use algorithms to determine the price of goods, through continuous learning,
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