To put this in some global perspective... Alibaba's one day sales event "Singles Day" last November grossed almost half that amount (i.e. $30B).
Note: Alibaba's operating margins are approx. 30%.
Note: Alibaba's operating margins are approx. 30%.
I see that one day sale thing appear in many mentions of Amazon and it might be a little...misleading.
Hypothetical: One business is making $100million in revenue, is losing $20million a year but has enough market cap to grow 10-100x and is spending most of its money on R&D/marketing, while a second business makes $1million in profit on $10million in revenue, but you've maxed out your growth and there's no more market cap, I'd rather be business 1, as you're on the road to potentially make hundreds of millions in profit later on.
i.e. I'd rather be Amazon some years back when they weren't profitable than some mom and pop online business that makes enough to pay the mortgage.
Even now, looking at the results, Amazon retail is not a great profitable business. It’s still low margin. No one could have predicted AWS - the true success story.
And look no further than YC backed companies. Have any of them become profitable? Even the one company that has gone public - Dropbox - isn’t looking to good these days.
Further more, even if amazon retail still isn't profitable (I haven't checked the numbers) AWS still wouldn't have spawned without it. Think of it as a pivot, even though they still kept amazon retail.
I'm not really sure what your YC comment has to do with things.
Think of it this way. What do rich people do with their excess money? They invest it. So if you're a company like Mongo/elastic, what do you do with your excess money? Well, invest it back into the business. Both of these companies have years of runway before they go broke or have to go profitable, so it doesn't make sense for them to try and be profitable when there is still so much of the market left in the open.
It is very annoying because the discounts are usually 1-2% (again as a westerner, may well be different for Asia) and it means you might have to wait a week or two for the product to ship.
I have asked stores if they can bill me full price and ship immediately and they say no.
So its really a marketing con to consolidate one or two weeks worth of sales into one day and then proclaim they had such a huge salsa day.
Imagine if Amazon billed two weeks of sales right on Black Friday. The numbers would be insane.
Alibaba has almost no self held sales. While Amzn only include profit from 3rd party as revenue, not sales from 3rd party (AFAIK).
eBay for example did $94b in gross merchandise volume in 2018, their revenue was $10.7b.