Amazon earnings and LivingSocial

January 19, 2011

ChannelAdvisor ChannelAdvisor By ChannelAdvisor

Amazon’s earnings are out next week, January 27th.  Apple crushed expectations yesterday and today we have eBay out so we’ll have a couple of good reads on the device (Kindle) and e-commerce market from those two heading into the Amazon results.  Over on sister-blog, eBay Strategies, we saw Amazon’s Q4 grow 36% from a same-store-sale basis.  When we look at all customers, not just the ones that have been with us for a year, they were up well over 100% for us.

From a seller’s perspective we carefully watch these metrics:

  • Overall GMV growth rate
  • The GMV growth rate of the ‘four amazon quadrants’:  media-us, media-intl, egm-us, egm-intl
  • The % of units that were third-party sellers
  • The ratio of buyer growth to unit growth (indicates purchase frequency trends)
  • Any other tidbits.

From a Wall St perspective, there is a lot of interest in a statement Amazon made in Q3 that they are building a bunch of new Distribution centres (DCs).  James Mitchell at Goldman has a note out that they have tracked 7 newly announced DCs.  This is an interesting topic to me so we’ll be spending some more time on it in 2011.  It definitely impacts sellers as it speaks to the FBA capacity as well as first-party sales.

We’ll have a full report out shortly after Amazon announces next week with all of our usual seller-based highlights.  One datapoint that we’ll work on is the size of Amazon’s 3P GMV.  Once 2010 is in the books, we’ll have a better idea of how that played out and how close they are to surpassing other marketplaces in scale.

LivingSocial Amazon deal – 

Living_social_amazon_deal

 

Also today, if you haven’t heard/seen it, LivingSocial is running a great deal – 50% off of a $20 Amazon gift card.  Amazon rarely has coupons of any kind so this is a great opportunity – especially if you have are a Kindle or Prime user, you probably already spend $20 on Amazon a month anyway, so why not enjoy half off?  It’s limited to one per user, but the users are done on a unique email basis (don’t connect to facebook), so you can game the system somewhat by using multiple email IDs (but you didn’t hear that here 😉

As of this writing (1pm ET) there have been over 500k purchased.  The deal launched at 8am and at 1pm hit 500k – so that’s a 100k/hr pace.  The deal ends at 8am tomorrow, but you can figure the last 4-6hrs will be dead, so call it 18hrs at 100k, I think this could hit 1.8m purchases or $18m to living social for $36m in Amazon purchases.

Amazon invested $175m in LivingSocial around the time that Google was rumored to be buying Groupon, so this definitely an interesting experiment by Amazon/LS to see if they can drive some strong joint customer acquisition as well as sales @Amazon.

As best I can tell, the deal only went out to the LS list, Amazon hasn’t promoted it.  I imagine this could be a first step and a broader promotion to the Amazon list could be a nice follow-up that would substantially swell the LS list size by piggy backing on Amazon’s >100m active consumers.  Amazon also owns Woot and Zappos so there could be other tests they could do with those brands before going all-in on the Amazon side.

 

SeekingAlpha Disclosure – I am long Amazon and Google.  eBay is an investor in ChannelAdvisor where I am CEO.  I am a LivingSocial member and did buy the Amazon deal today!