GroupM digital boss: Amazon will crush Australia’s e-commerce like an anaconda
The digital boss of one of the world’s biggest advertising groups GroupM has warned that online e-commerce giant Amazon will pose a major threat to Australia’s online retailers when it eventually launches in Australia.
Speaking at an Interactive Advertising Bureau (IAB) event, this morning, Rob Norman told the audience that when it launched Amazon would not worry about profitability and instead focus on “squeezing” out other smaller online rivals.
“I have the sense that there are a bunch of businesses in Australia that are imperilling themselves by not embracing e-commerce the way they could,” Norman warned.
“I think when Amazon is in Australia itself, and I believe they are on the hunt for real estate, people will make the mistake of thinking ‘it will be hard for them to compete on economic grounds’, but that is predicated on the presumption that they care.
Agree. Australia is ripe to be ‘amazoned’. High proportion of online advertising, high proportion of consumers buying online, yet Australian companies have been slow to adopt e-commerce.
Amazon Australia eh. Yes with Dutch/Bermudan/Luxemburg registered tax haven companies so it pays no Australian company tax at all. We will all be strangled.
Because theyre not prepared to lose the fatter margins many have enjoyed in the past. H&M are doing it to the high street, watch out Oz
Bought the new Richard Ford novel online from Amazon last week. It was on my Kindle a minute later. Total cost: $11.67 Aust. Just looked it up at Dymocks: $29.99 Aust in store. Says it all really.
Amazon has been threatening to come to Australia for many years.
Yes, they’ll make an impact here should they take that step.
My personal belief has been that the potential opportunity for them here is tiny compared with what they can still do in the US and Europe, which is why they haven’t gone big in this region yet..
A year ago I would have also agreed that they were about to launch here, but with Alibaba – whose anaconda makes Amazon look like a gecko – ramping up in the US, Amazon has some scary competition to deal with on their own patch for the time being.
Seriously in the current on-demand economy, who cares if it comes here or not. With #CrowdShipping @PostRope.com people can already buy whatever they want from anywhere in the world and get it shipped to their door by crowd. This international price discrimination and regional based restrictions aren’t going to be long term issues…
The company that really need to fear them is their subsidiary, the book depositary. Australia is their biggest market.
Everyone will be delighted when Amazon launches, but their tax affairs alone give them the edge over local competition. It will not be a good day for the industry.
It will be all over once Australia gets a taste for Amazon Prime.
$99 a year for free 2-day shipping on basically anything – not just books.
In Australia, Amazon is still just a book seller. And judging by these comments, that’s all it is to Australians.
In the USA, however, Amazon is just our local store. We go there to get basically anything and everything. In NYC you can even buy fresh groceries and have them delivered same day.
Australia is a country of luddites – but that’s not really the fault of Australian’s. Internet services are just all stone age.
Totally agree with you
I think there is something you are all overlooking. Amazon is already a de-facto online retailer in Australia, their logistics are just offshore. All that will change if they come to AU is that delivery times will be faster for goods kept in AU. Remember the cost of running Amazon’s Distribution Centre here with Australia’s premium labour rates will infringe on profitibality for Amazon too. There is also an interesting article on Amazon’s losses selling into Australia published in June http://www.powerretail.com.au/.....ail-plans/. Finally as much as you snigger how cheap things are overseas compared to AU, Don’t laugh when you lose your job because the company you work for cannot compete with discounted imports.
You’re wrong on a couple of fronts. Sure, Australians can still buy from Amazon in the USA if they like, and shipping times will reduce if Amazon runs fulfillment from within the country.
But you’re forgetting about the other 50% of what Amazon offers customers in North America and Europe: Prime. Movies, TV shows, music, photo storage AND free 2-days shipping. All for a subscription fee. Couple this with a burgeoning hardware business and you’ve got yourself a company that will crush more than just retail.
Plus, Amazon in the USA is more about convenience than price. Most things are the same price in brick-and-mortar stores. But the difference is you can have them sent to your home for little to no cost from Amazon.