Amazon.com’s slogan is “Earth’s Biggest Selection,” but that doesn’t
necessarily mean Earth’s biggest warehouse.
In fact, the company’s senior veep for retail says that adding to that
selection through partnerships is part of its long-term strategy, so more
deals similar to Amazon’s arrangements with
Target Stores and Toys
‘R’ Us can be expected.
Speaking at the Goldman, Sachs Internet New Media and e-Commerce Conference
in Las Vegas, Amazon’s Diego Piacentini, senior vice president for worldwide
retail and marketing at Amazon, touched on a variety of
topics from pricing strategies to advertising.
“We are building partnerships for the long-term,” he said, adding in effect
that “the planet’s biggest selection” doesn’t all have to come from Amazon
warehouses. In fact, some of it comes
from Circuit City.
“We will invest in technology to allow partnerships to be established more
quickly,” Piacentini said.
He also said that Amazon’s offer of free shipping on orders of $99 or more in
the U.S. “is part of our long-term strategy — we do see larger orders as a
result.” And he said that understanding how pricing works for customers “is a
key strength of the company.”
He defended the company’s marketplace sales, saying that allowing users to
sell pre-owned merchandise is “not cannibalizing our own sales, it’s about
offering the customer a wider variety of products, giving the customer a
choice.” The Author’s Guild recently
complained about the practice.
On the marketing front, Piacentini said that Amazon’s 700,000 online
affiliates are its strongest online marketing tool, and the company has been
honing its e-mail CRM efforts, not sending as many and personalizing them
more.
Off-line, he said “we are in many more circulars than last year, focused on
consumer electronics … we stopped doing direct mail because it didn’t pay
off.” Some TV is also planned.
Seattle-based Amazon
exceeded its pro forma operating profit goal for the first quarter,
lowered some book prices and raised its financial guidance.