How Amazon Fire Will Destroy Your Business

by Jonathan Goodman on July 3, 2014

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Hi everyone. This is Jonathan Goodman. Welcome to another episode of The World of Internet Marketing. Today we are going to take a detour from what we normally talk about in Internet Marketing and we’re going to focus on a recent announcement by Amazon for their new product called Amazon Fire. It’s a phone. And, you know, my understanding to the people who watch this podcast and listen to this podcast is that the majority of you are small business owners. This is going to be directed specifically to you. And it’s going to be directed to you especially if you have any type of retail location. Let’s get into this because this product should have you extremely concerned. And it is an affront to small businesses everywhere. I’ve created a little bit of a presentation and we’ll look at that now.

Slide 1: Halyard Consulting – How Amazon Fire Will Destroy Your Business

I call it How Amazon Fire Will Destroy Your Business. This is isn’t going to be a long podcast. I threw these numbers together after seeing the presentation that Jeff Bezos did. Isn’t Jeff Bezos a great guy? Doesn’t he look like a really fun guy that you could trust? Well, let me tell you something. This product that he is releasing, he is not a nice guy. You know, there’s one thing to build a respectable business, expand your product line, offer it across the nation, do great things like that. But what this product does, this phone is a direct attack on small businesses. Let’s look at what’s going on here.

So Amazon’s market capitalization is $149 billion. It’s not $1.4 billion. It’s a $149 billion. Their sales revenue in 2013 alone was $74 billion. Their stock price currently is over $324 per share. They spend an estimated $2 million to lobby the government for things like online sales tax that only benefits them. Transportation safety. I can only assume that it is to lower the transportation safety requirements. Privacy and Data. And believe me, while they say that they want to protect you, what they want is to gain further information about you. And Intellectual Property. $2 million to lobby the U.S. government for intellectual property. What are they trying to patent that costs $2 million to lobby the government? We already know that the government is willing to give away almost everything when it comes to money being handed to them. They are better than a charity like the Red Cross where the top official is making $400,000 a year. So meanwhile, Mom and Pop are writing a check to the Salvation Army or the Red Cross thinking that the majority of their $100 or $20, whatever it is, is going to help whatever relief aid is going on and it’s all going into the pockets of the corporation.

Slide 2: Amazon Fire Putting Mom & Pop Retail Out of Business

Amazon Fire will put Mom & Pop retail out of business. Let me show you how it’s going to do that.

Slide 3: The Death of Main Street

That feature, Firefly, allows anyone using that phone to snap a photo of any product – earphones, pens, lamps, hats, anything – whether somebody is wearing it, wearing they’re driving past it, whether it’s in your store. That’s the problem. They can take this photo and it will immediately show them the product for that user to then buy. Where do you think they’re going to lead that user? Do they think they’re going to lead them to your website selling that product that they’re standing in your store to buy? No. They’re leading them to Amazon. So what’s going to happen? Mom & Pop retail. These people are going to come into your store with this phone, they’re going to look at the things that they’re going to buy, they’re going to scan it using that image and Amazon is going to show them the product and they are going to make the purchase on their phone. Do you know what that makes your retail store? It makes it a museum. People will come into your store, they will take the photos and they will leave. And then two days later, they will have a package at their location, at their house or apartment, and it will be all the products that they would have bought at your store now coming from Amazon.

This is a major affront to small business. Small business built America. And what’s going to happen is one individual company is going to control all retail. I’m not just saying small businesses should be concerned. Wal-Mart should be concerned. Because where are most of the products now anyway? They’re at Wal-Mart. So I’m going to go to Wal-Mart. I’m going to take my Amazon phone and I am going to look at the products that I want to buy. And I’m going to click the button and I’m going to purchase it through Amazon. It’s brilliant for Amazon, but it’s horrible for the economy. And the government should step in and they should protect your small business rights, even your big box store rights, and they should say ‘this should not be allowed.’ So let’s look at this.

All the phone is, in the presentation, they didn’t even make a phone call. So who even knows if the phone has the ability to make a phone call? Because that’s not why Amazon wants you to buy the phone. They want you to buy the phone so that there’s a direct link from your buying habits to Amazon’s vast demographic servers. You want to give up your privacy, that’s fine. What they’re going to do is they’re going to match your personal profile to products. Do you know that Amazon right now is actually working on a system whereby they will move products – prior to you purchasing it – they will move product to a closer warehouse that they believe you will eventually purchase that product. Whether it’s a new wish list or just based on your demographics of what you’ve previously bought, they’re going to move items to a location closer to you.

And the phone comes with a great service. A great service. It will take all of the photos that you take with this phone and it will store it in the cloud on the Amazon servers. Isn’t that a great opportunity? You’ll never lose a photo again. But you know what it will do? It will show Amazon where you’re at, who you’re with, what you’re buying. It will see your nephew and niece’s party. It will know that there is an intimate relationship between your people in those photos, whether you’re drinking beer at the bar or whether you’re at little Timmy’s birthday party. This is all data that is going to be used to market to you demographically. It’s really unbelievable.

So you want to talk about power? Fine. It’s a quad core 2.2 gigahertz Qualcomm Snapdragon processor. 4.7 inch, 720 HD display, 2 gigabytes of RAM dual stereo speakers, 13 megapixel rear camera and front-facing camera for video chat. It has this great little tool that goes 3D. All these fancy little gadgets that are going to get you to buy the phone. They should have really made the product free because the amount of product that you’re now going to buy through it and the amount of demographic information that they’re going to have about you, pays for itself. So that fact that they want $199 for a 2-year contract with AT&T is just bilking you.

Slide 4: Ban the Phone – Stealing Customers with a Click of the Button

So let’s go back into this presentation. I’m very fired up about this because Amazon and companies like this, Google is one of them also, believe that the American people and world is stupid to the way that these things work. Look at this great gadget. We’re going to take a photo and you’re going to be able to buy this through your phone. But they’re stealing your customers with a click of the button. This phone should be banned.

Slide 5: Get the Sticker

And here’s what I’m going to do. If I get enough response from this video, if there is enough outcry on this, I will create a sticker that you can put on your business, in your wall, on that door when people come into your business that says “No Amazon Fire Allowed.” You know, “No shirt, no shoes, no service,” well, we need a stick that says “No Amazon Fire.” This is what we’ve gotten to. This is where we’ve gone. It’s terrible. Maybe I’m the only person who feels this way, but if you feel this way, then send me an email. Jgoodman@halyardconsulting.com. Go to our website. Sign up for our newsletter and tell me that you want a sticker. If there are enough people that want a sticker, I will produce a sticker (much better than the design that I came up with in two seconds) that will say “No Amazon Fire Allowed in my Store.”

Honestly, what I think you should do, I own a retail company, right? I owned an e-commerce retail that, if you want to hear that story, the distributor made a direct deal with Amazon, took all the products and only sold them directly to Amazon and left me with $170,000 worth of unsellable material. So you want to talk about why I’m angry with Amazon? Years and years ago, I lost a business because Amazon went and did a direct deal with my distributor. And for all those small Mom & Pops that don’t think that Amazon is reviewing your sales, you’ve got this great relationship with Amazon, you’re selling on Amazon, let me tell you what they’re doing. They’re grabbing all of that data. When they see an industry, like barbeque parts is working well and is selling on Amazon, they go to the distributor. They come in very nice suits. Very young people. They fly down to the distribution and manufacturing centers and they say ‘we can double and triple your sales. We will do this for you. All you have to do is sign an exclusive with Amazon and sell the product directly to us.’ Cut out all of your retail.

Now if that’s happened to you, I’m thinking about writing a book anyway, if that’s happened to you and you’re hearing this message, contact me. Let’s get all of that together and let’s build a book and sell that. Because Amazon is such a gigantic corporation now, they are going to eat away at the manufacturing and industry that retail has built. Small Mom & Pops like you.

That’s it. I am all fired up. I do apologize. Partially probably because of the World Cup, I’m all excited about this Sunday coming up. USA vs. Portugal. You can watch all of my videos on my personal YouTube Channel. I make predictions. Not part of my business. Just something that I like to do for fun during the World Cup.

This is a problem. If you don’t see this as a problem, then just wait for the next interation of this. But when your stuff next year or the year after that. If you’re a small business who’s 100 percent, or let’s say 70% of sales come from Christmas, and you’re gearing up for Christmas, and all of a sudden your feet are on the floor because Amazon ripped the rug out from under you because everybody came to your small Mom & Pop and started flashing all these photos of images of product that they want and Amazon sold them cheaper. Which they can because they can take a loss because they’re a multibillion dollar company, this is why. Call your Congressman. Get the sticker. This is a serious, serious affront to small business, to the entrepreneurs. Maybe you disagree, but if you agree, tweet this out. Facebook it. Share it. Let the world know that you’re not going to sit idly by as your small business is eaten away by a large corporation. You have a family to feed. If small business retail is gone and you’re invested hundreds of thousands of dollars into your small business, what’s next?

I’m sorry if I’m all heated up and fired up about all this stuff. I just can’t believe that Amazon would so blatantly attack small Mom & Pop enterprises. Well, that’s all I’ve got to say. Thank you listening. Take care. Bye.

Outro

Again, this is Jonathan Goodman and this is the World of Internet Marketing. You can follow me @HalyardConsult on Twitter. New episodes of the World of Internet Marketing can be heard every Friday. You can access the archives of my previous shows on Spreaker.com – user name Jonathan Goodman. The podcast is also available with transcription at halyardconsulting.com and geekcast.fm one week after the episode airs. Thank you all for listening to another episode of The World of Internet Marketing. Don’t forget to pick up my book The World of Internet Marketing on Amazon, and if you like this podcast please share it with your network of friends and family. Have a great week.

 

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