Amazon is often described as innovative, creative, experimental and ruthless. It’s also very, very big — and getting bigger.
With a market value of $1.6 trillion — nearly the equivalent of Russia’s gross domestic product — Amazon now dwarfs many of its retail rivals who’ve struggled to compete with a fast-moving organization whose expansive appetite seems endless.
But some retailers are finding ways to exist, even thrive, in a world increasingly dominated by Amazon.
In today’s special episode of the GeekWire podcast, we take a close look at Amazon and hear from former Amazon executives, leading third-party sellers and competitors who are trying to survive in the shadows of the world’s most powerful retailer. We also hear from critics who feel Amazon’s power has grown so immense that the only way to curb the company’s power is through government intervention.
Listen here, and subscribe to GeekWire in any podcast app. Continue reading for highlights from today’s show.
On this episode, hear key moments from this summer’s Congressional antitrust hearings into big tech, including comments by U,S,. Congresswoman Pramila Jayapal and Amazon founder Jeff Bezos. We’ll also hear directly from two third-party sellers, one of whom said Amazon essentially “knee-capped” his business and another who owes much of her success to the marketing muscle that the tech titan brings to the table. Along the way, we’ll gather a few expert tips on what it takes to successfully compete against Amazon.
In the early 2000s, entrepreneur Jason Boyce was one of Amazon’s biggest fans, achieving great success selling sporting goods on the platform. But about five years ago, Boyce noticed a change.
“In the last five years, it’s been an utter misery for all kinds of sellers,” said Boyce, noting that Amazon controls the data and dictates whether products will fail or succeed based on opaque systems.
Still, Boyce said sellers can still find a “way to walk between the shadows on Amazon” by focusing on a tight niche.
“You can become the best and the most knowledgeable in that niche category, and you can run with it,” said Boyce, author of The Amazon Jungle: The Seller’s Survival Guide for Thriving on the World’s Most Perilous E-Commerce Marketplace. “And when you step on a landmine, not if. If you know how to put the pieces back together, after that happens, you can survive on Amazon. It is a very, very narrow path that’s getting narrower by the day.”
However, that’s not been the experience of Madeline Haydon, the founder and CEO of Bellevue, Wash.-based natural food products company Nutpods.
Haydon says she owes much of her recent success to Amazon, and she thinks the company gets a bad rap as a “small business killer.”
“I have to be honest with you. We are a small business and they have absolutely been integral as a part of our growth and our scale,” said Haydon, who earlier this year won Amazon’s Small Business Person of the Year award.
As Haydon sees it, entrepreneurs can thrive on Amazon if they develop a compelling product and can quickly adapt to the evolving nature of the marketplace.
“Tell me in another category when a 30-person company can take on Nestle and Danone and be able to not only hold your own but actually compete with them in velocity,” said Haydon. “But that’s what you can do when you when you can use a tool like Amazon.”
Venture capitalist Jason Stoffer agrees that companies like Patagonia and Allbirds that focus on strong emotional connections with customers can compete against Amazon.
“People underestimate the fact that you can beat Amazon,” said Stoffer, citing Chewy in pet care and Wayfair in home furnishings.
“If you have a product that is unique and special, Amazon will copy it. But it’s not going to be as unique and special,” said Stoffer, a partner at consumer-focused venture capital firm Maveron.
Stoffer adds that competing solely on price with Amazon is dangerous territory for entrepreneurs.
“If you’re building a brand where the purchase is really the end goal, Amazon can kill you,” he said. “But if you’re building a brand where winning their heart is the end goal, then you can win.”
This episode of the GeekWire podcast was produced by Josh Kerns of Cypress Point Strategic. To see all of GeekWire’s coverage of Amazon and much more, subscribe to our daily email newsletter or visit GeekWire’s Amazon channel.
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