retail news in context, analysis with attitude

CNBC has a piece that asks the following question: “What will happen to Amazon if it’s forced to collect taxes on all of its sales?” The answers are inconclusive but interesting:

The story says that in the five states where Amazon already collects sales taxes on the products it sells, there has been “no indication” that business has slowed as a result.

The story also notes that Amazon has consumer loyalty in its corner, as illustrated by people who use Amazon Prime”

“ConsumerEdge Research has created an ‘Amazon Tracker’ to determine the number of Amazon Prime members, who pay $79 a year for fast and free shopping across all categories. These are the true Amazon diehards, and ConsumerEdge estimates there are 14 million to 16 million in the U.S., ‘a substantial number by any measure,’ says ConsumerEdge analyst Faye Landes.

“Her firm found that Amazon Prime members ‘buy many more categories on Amazon than non members, with an astonishing 21 percent of Prime members having purchased eight or more categories on the site in the last 30 days’.

“Bottom line, she says, ‘Prime is greatly assisting Amazon in achieving its endgame of being a one-stop shop’.”

And so convenience and habit may be more important than taxes.
KC's View:
Read those numbers again...

Amazon Prime members ‘buy many more categories on Amazon than non members, with an astonishing 21 percent of Prime members having purchased eight or more categories on the site in the last 30 days’.

That’s extraordinary loyalty to an online retailer.