Groupon says its focus is on the bottom line, rather than top-line growth.
Will Amazon ship dirt?
Last weekend, inspired by the first balmy day in Chicago in months, my thoughts turned to gardening. I wrote up a list of what I'd need to buy to be ready to plant when the weather turns for good in a few weeks: new pots, dirt and plant food. With this month's cover story on Amazon in the back of my mind—and my reluctance to spend a beautiful day wandering Home Depot—I thought, "Would Amazon really ship dirt?"
A quick tap on my iPad showed me, yes, Amazon will indeed ship dirt. In fact, it'll sell me a 26-pound bag of dirt for $10.99 and deliver it to me in two days for free because I'm an Amazon Prime member. That's only a buck more than Home Depot was selling it for, and I'd have to go to a store to buy it because Home Depot won't ship dirt.
Amazon may have to eat the financial loss on the sale of dirt—UPS rack rates show it'll cost more than $22 to ship a 26-pound package from Hebron, Ky., where most of my Amazon orders come from, to me. But Amazon assuredly made up at least some of its loss when just hours later I paid it $6.99 to download an e-book to my Kindle. Amazon's shipping cost on that sale was zero.
Amazon has accomplished a remarkable and valuable thing. It's made me, and millions of others, shop Amazon first. For dirt and for e-books and for thousands of products in between. That's been Amazon's goal all along, and it's made it a reality.
That's a frightening reality for competitors, which includes almost everyone else that sells online. Amazon's every move creates turbulence for every other e-retailer, and competitors must have a game plan. You can read about how a handful of e-retailers are finding ways to compete, starting on page 22. They can't turn a profit if they sell dirt the way Amazon does, but they're not ready to throw in the towel either.
Allison Enright, Editor