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Digital Boss Warns Amazon Is Coming + That They “Will Crush” Local Retailers

Digital Boss Warns Amazon Is Coming + That They "Will Crush" Local Retailers

According to Mumbrella who attended an Interactive Advertising Bureau (IAB) conference today Rob Norman told the audience  that online e-commerce giant Amazon will pose a major threat to Australia’s online retailers when it eventually launches in Australia.

Amazon is tipped to launch a full operation Australia early in 2015 after appointing former Yahoo!7 CEO Stuart Sayers as CEO with Norman telling the audience that he understood that Amazon were looking  for real estate for a larger local office and warehousing in Australia.

Norman told the audience that when it launched Amazon would not worry about profitability and instead focus on “squeezing” out other smaller online rivals.

“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,” Norman warned.

He told the audience that  in Australia “You have one of the highest proportions of online advertising in the world and almost everywhere else in the world there is an almost exact correlation between the percentage of advertising that is online and percentage of GDP that is spent on ecommerce.”

“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.”

Yesterday Audible, the audio-book arm of Amazon, officially launched in Australia, giving away free content as an incentive for new members.

Norman said “One of the observations I made to a retail conference was to ask ‘do you know what anacondas, and boa constrictors are?’ And the audience said ‘yes they are snakes’ and then I asked ‘what do they have in common?’ and they said ‘what they do is they curl themselves and squeeze it till it dies’.

“Then I asked ‘where do they all come from?’ And of course the answer was: ‘the amazon’ and that gives you a decent insight into how Amazon might think about that,” he quipped.

Norman also noted that Australia was one of the few parts of the world where there was not a correlation between the high levels of online advertising and the relatively laggard state of e-commerce.

“One of the observations one can’t help but make about Australia is that the e-commerce business is under developed compared to the rest of the world,” said Norman.