Few will dispute Amazon’ s role as the current king of the e-commerce space. Many of the leading lights in social commerce, were present at the TechCrunch Disrupt conference in New York last week, where they discussed the idea of social commerce and where the marketplace is going in the future in terms of both monetisation and socialisation.
All of the panellists seemed to agree that Amazon will continue to reign supreme in “commodity commerce” but will not be able to lead in social commerce. More people are starting to crave relationships in shopping was their conclusion, and that Amazon will continue to monopolise the “boring old” way of shopping!
These relationships have captured the attention of millions of paying customers. Groupon is valued at $1.35 billion, while Gilt Groupe is expected to triple revenues this year.
Other industry giants are thinking through ways to horizontally integrate into the social commerce space. eBay is aggressively targeting the flash sales market, having recently launched the Fashion Vault. , a flash sales site that offers deep discounts on designer items.
While an acquisition may make perfect sense for a cash-rich company like Amazon (they have $5bn stashed away!) some will argue that they should continue to focus on scaling traditional online retail business. After all, revenues continue to rise as they continue to sell a ridiculous number of Kindles, and other products. And they did recently acquire Zappos for $1.2bn.
For over a decade, Amazon and eBay have enjoyed the fruits of a market that required a greater focus on scale than on innovation. But the rise of Groupon, LivingSocial, Vente Privee, and other social commerce sites have taught us an undeniable truth that customers are ready for something different.
The question is whether Amazon will disrupt its own model in order to preserve its reign as King.