retail news in context, analysis with attitude

Though Amazon has been much criticized in recent weeks because its continued investment in products and services has made it increasingly difficult to generate the profits that investors crave, the company seems to be continuing its strategy unabated.

For example…

Reuters reports that Amazon plans to offer "a new ad-supported video streaming service early next year" that will be separate from its Prime membership program, which also offers access to video.

Prime membership costs $99 a year; it is unknown at this point whether Amazon plans to charge for the new video service.

According to the story, "The new service will compete directly with Hulu and Netflix, whose charges start at $7.99 a month for customers in the United States."

And, there are published reports that Amazon is planning the creation of a travel website that will offer hotel accommodations and charge the hotels a 15 percent booking fee. The focus, at least in the beginning, is said to be independent hotels and small chains that don't have the marketing budgets of major chains; such a move would position Amazon as competing with the vast array of travel sites currently operating, but would take advantage of its comprehensive database of customers.
KC's View:
I'm not sure that I'll have much use for the new video service, and it makes sense when some of the stories suggest that Amazon will use it to drive people to Prime, which continues to be one of its best ideas and values.

But the hotel thing intrigues me - I'd totally try it, just because Amazon has a lot of brand equity in terms of availability and price. It'll have to deliver on the promise, but if it is a differentiated service, it could make a lot of sense.

It is all about keeping us in the Amazon ecosystem as much as possible…