Who Will Displace Amazon? One Of These 3 Will

Last week, my colleague Brian Walker and I released a lengthy overview of Amazon, its role in retail, and what eBusiness executives need to do to compete with this growing retail force. The larger undercurrent of the report is that Amazon is affecting everyone’s business: its tentacles extend far into digital and physical goods, it is vertically integrated but also a distributor, it is unafraid to spend money to gain market share, and it can successfully compete on price with retailers far bigger than itself. And when disruptive forces arise, they dominate for years. So that begs an even bigger question of Amazon: if this is its decade, who will displace it? The company seems unstoppable now, and it will take a radical new business to displace it. Here are three possibilities:

  • Walmart with a monster marketplace. Walmart in its current form will only continue to lose share to Amazon. While Walmart continues to focus on aggressive pricing by pressuring suppliers, Amazon has an equally compelling value proposition for shoppers because it has a lucrative marketplace. And while Walmart has dipped its toe in a marketplace its own, it’s really been a mediocre effort. BUT if Walmart really had a bona fide marketplace, say, by acquiring eBay, it would give it an economic model more similar to Amazon’s: a high-margin business that can bolster the low-margin one. And deeper Walmart pockets mean that someone could finally out-Amazon Amazon.
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