Amazon's posting of a 69% increase in third-quarter profit gave cause for many analyst to believe that this Holiday season looks rosey for online purchases.
As reported in today's Wall Street Journal, Amazon's quarterly increase jumpted to $199 million, or 45 cents a share, from $118 million, or 27 sents a share a year ago. Sales surged 28% to $5.45 billion. The increase is attributed to 44% rise in sales of electronics and general merchandise, including TV's and office supplies. The increase was also attributed to a 17% rise in media sales and the debut of several popular books.
Amazon's positive results offer support to the belief that e-commerce sites are benefiting from bargin-hunting consumers. On Wednesday, eBay Inc. reported its first revenue gai in three quartes.A survey by the National Retail Federatons's Shop.org and BIGresearch of 70 retailers, found that online sales growth is expected to slow this holiday season, but still fare better than the rest of the retail market. Almost 46% of repondents surveyed projected their holiday sales would grow at least 15% over last year's sales.
Thirty-one percent of Amazon's unit sales come from third-party merchants who give amazon a percentage of their online revenue. Mercent corp. reported that sales among 40 of their clients who sale products on Amazon, increased 70% in the third quarter compared to last year.
That's the news here's the analysis, Entrepreneurs and small business owners have to work exceedingly harder then ever to make a profit in today's economy. Relief from our current economic woes does not appear to be anywere in sight within the near future. This demands innovation of our current activity and means of making a buck.
Action Items:
1. We need to find additional venues for selling our merchandise. Online sales is a must if we hope to increase sales and keep up with competition. If you are already online, analyze your traffic with such free tools as Google Analytics. Google Analytics provides a huge library of online help intructions for setting up and analyzing your online traffic reports (Contact me if you need help).
2. Show how consumers can save money by using your product! Price reduction is a last resourt but can you come up with ways consumers can save money by using your product? Once you come up with a way your product can save money, advertise that fact! There is a reason why Wal-Mart and McDonalds are experiencing increase in revenue while higher priced competitors are struggling to servived.
Now is the time to prepare for the holidays by making your product available online and by helping consumers save money this holiday season.
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