We open on America, not too far removed from the turn of the century. Businesses offer services that are of vital importance, but the services are controlled by very few, and these businesses only seem to grow bigger with each passing day.
These businesses are so wealthy that they can undercut all competition, even if it means taking a loss, essentially driving everyone in the same field out of business. They know that consumers will continue to use these services because they’ve become necessities, and so, as market share is gobbled up piece by piece, whispers emerged that describe these businesses like what they are: monopolies. How can the people hope to overcome such immense titans of business? Is the country doomed to be ruled under monopolistic companies forever?
I’m describing the turn of the 20th century, during which time Standard Oil and the Northern Securities Company controlled oil refining and the railroads respectively, but perhaps that scene reminds you of a closer point in time. Commerce has drastically changed in the last decade, and consumers are now having to face questions that haven’t been faced since the trust-busting days of Teddy Roosevelt. It begs the question then: is Jeff Bezos joining the company of robber barons like Cornelius Vanderbilt, Andrew Carnegie, and John D. Rockefeller?
Amazon became a trillion dollar company this summer, leading to a close examination of its control of the e-commerce market. According to a study by e-Marketer, Amazon accounted for 49.1 percent of the market share for e-commerce sales. The next closest company was eBay with a 6.6 percent market share. That is an astonishing share of a growing e-commerce market.
Half of the sales online were conducted on Amazon.com. This is possible as Amazon has always been willing to operate on a loss, as they undercut any competition to gain a larger market share. We’ve talked before about how selling on Amazon is suicide, as they’ll undercut you at every juncture, but when every other sale online is made on Amazon, it becomes increasingly difficult to pass up that kind of platform.
Before we delve into what to do with this information, Hasan Minhaj, formerly of The Daily Show, and current host of Netflix’s Patriot Act recently broke down the gravity of Amazon’s market control. The 20-minute video covers the difficult nature of “being woke” and also “being lazy” when it comes to huge potential monopolies like Amazon.
It’s safe to say that if Bezos isn’t at the level of domination of Vanderbilt, Rockefeller, and company, he will be soon. Truly, he is on the way to becoming a robber baron in a digital gilded age. In the 20th century we had trust-busters like Roosevelt and Taft, but who will rise to the occasion in the 21st century? How can regulation impact an abstract concept like data? The answer is, I don’t know.
So how do you have hope in a world that is increasingly dominated by Amazon? The best strategy right now is to go after the other 50 percent of market share. Build a brand that is impactful to people, and makes you stand out from the crowd. Offer a service that is second to none, and provide a beautiful online shopping experience. Amazon may control the market, but their site is not one of the most beautiful online experiences. It’s just the most effective at accomplishing its goal.
It’s easy to feel a certain doom and gloom when facing the ever-growing reach of Bezos, and that 50 percent share will only grow in the coming years. A decade from now, Amazon may even be able to battle Walmart in storefront commerce.
But hey, the polar ice caps will melt by 2030 if we don’t act, so Amazon’s growing market share may not be the worst thing.