Amazon.com, Inc. (NASDAQ:AMZN) might have underperformed for the better part of his year but it is not letting its woes get on its way of innovating new ideas that are expected to spur growth going forward. The giant online store is now giving eBay Inc. (NASDAQ:EBAY) a run for its money in terms of negotiation options on its platform after launching a new haggling feature that will be used to facilitate negotiations between sellers and buyers.
During an interview in CNBC, RBC Capital Markets Managing Director, Mark Mahaney, argued that 2015 is poised to be a great year for Amazon.com, Inc. (NASDAQ:AMZN) on stabilization of margins.
“There has been one building growing threat to eBay Inc. (NASDAQ:EBAY) over the last five-ten years; it’s been Amazon. You’ve seen sellers move there; you’ve seen buyers move there this just adds to that. We think it is more incremental than material,” said Mr. Mahaney
Amazon.com, Inc. (NASDAQ:AMZN) now wants to be a big a flea online market in addition to its fixed price business model after stating that customers can now negotiate for even lower prices with the ‘Make an Offer’ feature . Customers can now haggle with sellers by simply placing an offer they are willing to buy for a given item. The launch of the new feature has prompted the giant online store to categorically state it is not an auction site, but an online store trying to drive prices lower to the satisfaction of customers
The ‘make an offer’ feature is expected to give Amazon an advantage against its fierce rival eBay Inc. (NASDAQ:EBAY) in the push to attract more buyers on its platform. Amazon has aggressively been building distribution centers according to Mahaney aimed at ensuring deliveries are made within the shortest time possible.
“This company is bringing packages, bringing its services closer and closer to customers and we think we are starting to see a reaction. We are seeing an acceleration in their electronic and general merchandise category. That’s the early-tell that all this infrastructure building all these crashing of margins that it is finally starting to pay off. It’s our number one pick for 2015 precisely because of this,” said Mr. Mahaney
Despite the huge investment in infrastructure, Amazon.com, Inc. (NASDAQ:AMZN) has remained an underperformer for the year with Mahaney acknowledging that investors might have thrown in the towel on the stock. Mahaney believes the stock might have found a new support level at the current trading margins which should guarantee an upside going forward.
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