Amazon.com Launches New Site To Compete With... Well, Amazon.com

from the funny-how-that-works dept

Thu, Jan 4th 2007 2:28am — Mike Masnick

If you read what we discuss about competition and innovation around here, it's no surprise that we believe that a company that is simply resting on its laurels is going to eventually be in trouble. That's why one of the most interesting things a company can do is cannibalize its own offerings. Intel famously does this on a regular basis. Basically, the lesson is clear: if you aren't willing to cannibalize your own offerings, someone else will do it for you. It's a lesson that plenty of big companies don't like to learn -- but they all learn it eventually when the competition eats their lunch. That's why it's always fascinating to see the ways that companies try to stave this off. One of the more interesting ideas that probably makes sense for some larger companies is to build a separate group, whose job is effectively to act as the competition. Let them develop the next great competitive advantage -- and if it destroys your existing business, better that it's done by your company than someone else's. It looks like Amazon may be practicing a bit of this concept by launching a brand new shoes and handbags store, that looks like it has nothing to do with Amazon.com. They named it something different (Endless.com) and built the site up from scratch, not relying on Amazon's e-commerce or search tools (they do use Amazon's distribution and warehouse system, however). Looking at the website, you'd have no idea it was related to Amazon at all.

While many people will point out that this is really more an attempt to compete with marketplace leader Zappos in the shoes and handbags e-commerce world, it's even more interesting as a case study of Amazon competing with itself. Amazon already has a shoes and handbag store on their main site -- but this is entirely different. It's also interesting because Amazon is still often considered the e-commerce company that has the most advanced e-commerce system. Despite years to try to catch up, few other sites offer nearly as much functionality. In fact, Amazon has made good money over the years reselling their platform to other sites who want to just leverage Amazon's expertise in e-commerce software -- yet, Amazon itself decided to build a new system from scratch for this offering. It's definitely going to be worth watching how this evolves, and whether Amazon and Endless learn from each other, or continue down separate paths.

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19 Comments

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shawn, 4 Jan 2007 @ 3:55am

Could be more to it
Perhaps they're just building something they'd like to sell off in the future.
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Enrico Suarve, 4 Jan 2007 @ 4:08am

Watching that space
It sounds like a great idea and worthy of much kudos to Amazon if it really is the intention to develop in house competition to improve themselves, however it could just be something more 'normal' like shawns planned sell off idea

worth keeping an eye on though and reserving judgement
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Dav, 4 Jan 2007 @ 4:31am

seems like a good idea to me, many companies know how powerful they could be if they had control over their competition, just look at Microsoft.

Amazon will control their own competition giving them a good control over the market and probably just boost their profits even more.
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Dav, 4 Jan 2007 @ 4:33am

sorry for the second post.

I wonder how this is going to effect the consumer though. We all know that real competition drives down prices and improves services but i suspect this pseudo competition will have a lesser effect in this area.
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Jason Bateman, 4 Jan 2007 @ 5:18am

what? No Puma or Nike at Endless.com?
Even Amazon.com has puma & nike.

i wonder what deals Endless.com has made with the manufactures/suppliers, that Amazon.com is exclusive to... and how this can affect either site in the long run.
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Fortino, 4 Jan 2007 @ 6:41am

PiperLime
This is actually their attempt to go more upscale in the market. They are following the lead from Gap's recent launch of PiperLime.com.
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Anonymous Coward, 4 Jan 2007 @ 6:46am

just checked it out and agree with #5 that they are lacking some major brands, including many of the popular premium and high fashion brands that Zappos has (Camper,Diesel,Fluevog,Miss Sixty, Very Wang etc.). that being said, I really like the shopping interface. it's easy to see why they wanted to reinvent the shopping engine from scratch--they've built a clean, web 2.0 site that is a big step up from both Zappos and Amazon. It's AJAX-y, media rich, replete with visual effects and a killer selection tool. it could be we're looking at the future of Amazon's shopping interface ...
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Mr Schotz, 4 Jan 2007 @ 7:28am

bags
Doesn't the world already have enough bags?
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Anonymous Coward, 4 Jan 2007 @ 7:32am

Not built from scratch
I just placed an order with them and they DO use Amazon's software. The checkout process was identical to Amazon's, just using different CSS. Amazon logo even displays, allows me to log into my Amazon account and use my saved shipping addresses and credit card.
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cycloscott, 4 Jan 2007 @ 8:26am

No surprise
Just take a look at the Zappos interface. Fugly. Now take a look at Piperlime (Gap's foray into the market), and Endless. Much more content driven with Ajax and a semblence of order about them.

Yeah, neither one matches the volume of choice of Zappos, yet. But as they ramp up, I fully expect to see more and more manufacturers.
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Wolff000, 4 Jan 2007 @ 8:26am

Nice and Shiny
As stated it is actually a very nice site with some flashy and useful tools. I like flashy as long as it’s useful and doesn't bog down my pc trying to run it. I think this is Amazon's way of testing new ideas without ticking off Amazon customers. If they were to make major changes to the site than a lot of people would be really put off. Most folks don't like change. They did it the smart way by creating a different site with no customer base yet and testing new ideas there. I think a lot of the tools that Amazon doesn't have and endless does will slowly migrate to Amazon. They just want to work out the kinks and see how the public takes it. Just my 2 cents and I could very well be completely off base.
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Skot Elektron, 4 Jan 2007 @ 8:28am

its in the design
marketing marketing marketing. many uppities wouldn't be caught dead buying shoes and handbags at wal mart, either. shit, what would they tell their friends?
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Anonymous Coward, 4 Jan 2007 @ 9:02am

Re: Not built from scratch
The site uses a seperate web server application layer including new presentation widgets and rendering, but places calls to the same underlying ecommerce services.

The checkout pipeline is currently a customization of the UI used to build the third party sites (Target, Bebe, Bombay, Mark's & Spencer's, NBA-Store, etc), but will be moved to its own workflow/format/presentation in the next 6-9mo.
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Pele24, 4 Jan 2007 @ 9:12am

Been there done that
Hasn't the car industry been doing this for years??? How many brands does GM have now where you can by the same car with a different logo and interior? I guess creating internal competion to drive innovation only works if you're smart enough to realize that there is still competion outside your own companies.
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Bench, 4 Jan 2007 @ 10:08am

Props to #13 for the tip-off and #11 for the rationale. Again, I think we're getting a glimpse of the future of Amazon.

On another note: competing with oneself isn't unusual at all. Private label products from mayonnaise to carpeting are usually produced by a company that also promotes its own national brand.

What's interesting here is that Amazon is "private-labelling" its core E-commerce and logistics platforms instead of the products themselve -- also not a brand-new concept, but intriguing nonetheless ...
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Michael C. Neel, 4 Jan 2007 @ 10:36am

Not competition
Everyone repeat with my, "there is no such thing as channel cannibalization" - a customer is a customer period.

Amazon for years have been investing in SOA for others to build stores around their products and services. Why not use it themselves?

For the types of people (persona) looking for designer handbags and shoes, is amazon.com the shopping experience the one they are looking for? No, that's pretty clear. Using SOA to build an experience your customers are looking for is exactly what technology is supposed to be doing.
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Bench, 4 Jan 2007 @ 11:30am

To coin a term ...
Channibalization ! (even if it doesn't exist)
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cheap designer clothing, 29 Dec 2010 @ 6:14pm

designer clothes
we hear that top quality designer clothes online at the designer clothing store, many men wholesale designer clothes at this outlet.
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GHDS, 5 Apr 2011 @ 8:24pm

ghds
onder how this is going to effect the consumer though. We all know that real competition drives down prices and improves services bu
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