Is Social Commerce Amazon-Proof? AmazonLocal Muscles in with $10 for $5 Deal

by Paul Marsden
in Social
— 21 Mar, 2012

Social commerce sites, services and apps watch out, Amazon is beginning throw its weight around.

Having already shown the world how to use Facebook to help Amazon customers shop smarter with Facebook-powered birthday reminders and recommendations, the retail giant is now stepping up its assault on the group-buy/daily deals sector with AmazonLocal.

Already the #3 daily deals site in the US ($6 million in gross billings in October), AmazonLocal boosted its user base yesterday with a $10-Amazon-voucher-for-$5 deal designed to lure in new customers. 7 hours into the deal, it had already sold in 231,000 deals. (Competitor site LivingSocial, in which Amazon is a part owner ($175m), ran a similar deal last year to make 1.4m sales ($10 for a $20 voucher))

So Amazon has deep pockets and is giving away $5 to new members to sign up to AmazonLocal, so what?

For businesses playing in the social commerce arena, AmazonLocal should be a reality check that prompts the question ”Is our business Amazon-proof?”

Of course, Amazon could do pretty much anything it chooses to do, so the key is in identifying an opportunity that is not attractive to Amazon or that plays away from Amazon’s key strengths; passion-niches and expert-curation come to mind as key Amazon-proof opportunities.

What do you offer that Amazon doesn’t or wouldn’t want to offer?

Here’s the sales pitch to businesses from AmazonLocal. Compare and contrast to Groupon and LivingSocial. Less sizzle perhaps, but the steak is there.

Reach

You want your message in front of as many people as possible.

Amazon has more than 144 million active customers. Every day we email customers in your area featuring a terrific offer from businesses like yours.
Your business will be marketed front and center with the Amazon brand–the most reputable brand in the U.S.⁽¹⁾

Customers

You want to reach people who will become valued customers.

Amazon customers spend 70% more money online every month than the average Internet user and $55 billion in offline purchases every month.⁽²⁾
Amazon customers can use their Amazon.com account to shop on AmazonLocal, so purchasing is simple and secure.

Impact

You don’t pay to run a promotion, and you can measure its success right away.

Unlike traditional marketing, you don’t pay to run a promotion with AmazonLocal. You only pay a referral fee for the customers you acquire.
You’ll know how many people are purchasing your offer on the very day it’s featured. And when new customers arrive with their vouchers, you’ll know how they discovered you.

Tags: Amazon

— Paul Marsden

Psychologist specialising in consumer psychology, innovation and technology. Author, speaker and researcher for consumer brands, technology companies and marketing agencies.