Amazon to pose a major threat while Netflix touches down in March 2015
Last month we spoke about Amazon Fresh, Amazon’s grocery and non-grocery home delivery service which is currently operating in the US but looks to be on the move to Australia very soon.
More information to support Amazon’s movement has recently come to light as well as how the online e-commerce giant will impact the Australian market upon arrival. Rob Norman, the digital boss of GroupM, one of the biggest advertising groups in the world, stated at an event last week that Amazon will pose a major threat to Australia’s online retailers when it eventually launches. Norman predicted that when Amazon do touch down, they’ll focus on “squeezing” out other smaller online rivals instead of worrying about profitability.
Norman explained, “I have the sense that there are a bunch of businesses in Australia that are imperilling themselves by not embracing e-commerce the way they could. I think when Amazon is in Australia itself, and I believe they are on the hunt for real estate, people will make the mistake of thinking ‘it will be hard for them to compete on economic grounds’, but that is predicated on the presumption that they care. Everything we have seen is that Amazon doesn’t care about that.”
Amazon is believed to launch full operation in Australia imminently after appointing former Yahoo!7 CEO Stuart Sayers as CEO last year.
Australia’s e-commerce business is under developed to the rest of the world which would further suggest now is the perfect time for Amazon to strike. It will no doubt shake things up for smaller online retailers who will need to up their game if they have any chance of competing and could cause major issues for Coles and Woolworths Online if they bring along Amazon Fresh.
In other news, Netflix, the popular TV and movie streaming service, has also announced this week that they’re coming to Australia in March, 2015 much to Aussies delight. (Could this be why we’ve recently seen Foxtel heavily advertise their price reductions?). The popular streaming service hosts a huge library in the US including popular TV series such as Orange is the New Black and House of Cards however things are set to work a little differently here in Australia. This is because certain big name TV series are already contracted to current providers such as Foxtel which means some titles which appear in the US, will be absent in Netflix Australia. With the subscription price still unannounced, it will be interesting to see if Netflix has enough content at the right price to bring people across from Foxtel or gain free-to-air viewers.
Do you think Amazon will crush Australia’s e-commerce when it eventually arrives? Does Netflix have enough content to shake up subscription TV?