The basic idea with the partnering approach of Amazon.com. was to let another firm bear the risk of selling products that had unique problems and yet share in the potential upside from such a venture. Specifically, Amazon.com acquired ownership stakes in many companies including: Drugstore.com, HomeGrocer.com, Pets.com, Ashford.com, Gear.com, Audible.com, Greenlight.com, Living.com and Della.com. (Krishnamurthy, 2003)
Amazon.com has three kinds of partners. First is “Large Partners� that are companies like Target or NBA who are selling their own merchandise in a buying and selling interface that Amazon provides. (Friedman,2004) For example, Amazon.com has added retailer Target to its growing list of brick-and-mortar partners.Under this partnership, Target will sell clothing, home products, electronics and jewelry through Amazon.com, starting this fall. Amazon.com will be responsible for customer care and order fulfillment and will receive a fee for each unit sold, as well as annual payments from Target. Specific financial terms were not disclosed.(Regan,2001) Another example is NBA. Amazon.com agreed to provide the technology to handle online sales for the sports merchandise stores on NBA.com and WNBA.com. Under the multi-year agreement with the National Basketball Association (NBA) and Foot Locker, shoppers will be able to purchase NBA and WNBA merchandise such as jerseys and T-shirts through Amazon.com's Apparel & Accessories store as well as the NBA.com and WNBA.com stores.The NBA hopes to benefit from Amazon's wide-ranging brand, using Amazon's technology platform to let customers access the NBA and WNBA online stores with their Amazon.com accounts. (Boulton, 2003) Customers notice that when they go to these stores, they bear the partner’s name along with Amazon.com’s name.
Second is “Small Partners� that refer to their presence on Amazon’s site. Small partners are companies that offer some of their products in existing Amazon stores. Those products appear side by side with products from other similar partners and even products from Amazon itself. Small partners include companies like Circuit City in Electronics or The Gap in Apparel & Accessories. (Friedman,2004)
Third is “Trusted Partners.� that offer products and/or services that Amazon doesn’t �?products like cars or medications and services like booking travel and photo
development, and so on. Amazon.com checks these partners out, makes sure they’re good to do business with, and then includes what are essentially links to these partners on their site. But when customers interact with a trusted partner, they are typically using the trusted partner Web site, not Amazon.com. There will be a link to Amazon at the top of the page, but customers are no longer actually there. Amazon.com’s trusted partners include: audible.com, CarsDirect.com, Ofoto.com, and The Vacation Store. (Friedman,2004)
Boulton,Clint. (2003) “Amazon to Power Online Sales for NBA� ClickZ New retrieved 20 October, 2004, from
http://www.clickz.com/news/article.php/2193191
Friedman, Mara. (2004) Amazon.com for Dummies , Hoboken: Wiley Publishing Inc., ISBN 0764558404
Krishnamurthy, S. (2003) E-Commerce Management:Text and Cases, Louiseville:Transcontinental Printing,Inc.,
ISBN 0324152523
Regan, Keith. (2001) “Amazon and Target Forge E-tail Partnership� E-Commerce Times retrieved 20 October, 2004, from
http://www.technewsworld.com/story/13470.html
Sharon Tse 12:45, 9 Sep 2004 (EST)
