The ongoing coronavirus pandemic has translated into heavy losses for companies all across the globe. Even if you’re one of the biggest companies in the world, economic losses in some form or the other have been your reality.
For Amazon, these losses have occurred in the form of losing marketshare. Lockdowns imposed because of the pandemic meant that Amazon could no longer safely deliver products to their customers’ houses. This became an even bigger problem when their demand rose exponentially due to millions of Americans turning to online shopping.
Thus, the customers turned to other outlets. Target’s online sales shot up 141% last quarter, while Walmart’s rose 74%.
According to data collected by Rakuten Intelligence, Amazon was responsible for 42% of online spending in the US before the pandemic. But by mid-April, their share had fallen to 34%.
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However, Amazon is now fighting to get back on top.
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The company hired and trained nearly 175,000 new employees in May. The increase in the workforce allowed the company to deal with the backlog of orders that had been increasing. This also allowed Amazon to quickly replenish its warehouses.
The pandemic had forced the company to slow shipping on many items from a few days to almost a month.
To get back to its former position, Amazon is now shipping many more items in a short span. It has removed limits on the types of products allowed in its warehouses, and has restarted promotions.
An audio recording of an internal meeting revealed that a “Summer Sale” to let brands sell excess inventory was in the works.
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“They eliminated their own competitive advantage they had built over 20 years,” said John Ghiorso, who runs an agency that helps brands run their Amazon business.
“Now they are getting it back pretty quickly.”
An Amazon spokesperson said –
“We know customers want their deliveries as quickly as possible, and we are working hard to return all products to faster delivery speeds while helping keep our employees safe.”