Amazon's first quarter earnings made one thing abundantly clear, coronavirus has sent sales soaring as people shop from the safety of their homes, but keeping up with the huge surge in demand while trying to keep workers safe has also sent Amazon's costs through the roof. Amazon is now playing a game of catch up in the face of too much business, it did the opposite of what's made it the world's most popular Ecommerce site..try to get shoppers to buy less. They didn't have a choice but to slow down traffic to turn off a lot of the features that were driving additional revenue in sales so that they can do their best to supply there was a need right now. jetcube explores how Amazon tweaked its online shopping experience to slow down site traffic and we had fewer items in your cart so we can get back to what customers have come to expect from the everything store delivery of almost anything in one to 2 days. At the same time that Ecommerce sales are surging more than 70 percent above last year's numbers. Amazon faces unprecedented supply chain and delivery slowdowns, in addition some Amazon workers stayed home taking advantage of special leave policies to deal with illness or minimize exposure
Amazon doesn't need to be finding ways to get people to buy more products instead it was on needs to look for ways that they can manage this rapid increase in demand that they've recently got its home page is one of the first indications that Amazon is finding ways to cut down on demand. for weeks Amazon stopped allowing sellers to offer coupons and other deals on items which normally drive up sales. Amazon also drove fewer products to shoppers carts & no longer displaying the frequently bought together and other products suggestions. Another way to cut back on sales is to cut back on overall site traffic according to data analytics firm semrush Amazon.com's saw more than 4000000000 visitors in March more than the total visitors to apple eBay Walmart rocket 10 and Samsung combined. One big way Amazon normally brings outside shoppers to its site is it buys a huge amount of advertising on Google search engine, it stopped much of that spending in March Amazon is actually Google's largest client in all of those ads appear to have been turned off another way. Amazon brings in outside sales is through its affiliate marketing program where outside sites and reviewers partner with Amazon in exchange for a commission for each sale they generate those commissions were slashed recently giving less incentive for affiliates to drive shoppers to.
Amazon stopped allowing sellers to sense nonessential items into its warehouses all together in March. Amazon has over 500 warehouses in the U. S. generally experiencing getting ready for spikes in demand for known events like the holiday season and prime day we also generally spend months ramping up for these periods. Amazon has allowed all of its own electronic equipment to continue to be viewed as a central so if you need a kindle you can get it right away. Amazon largely uses algorithms to determine what is essential and how many nonessential sellers can ship into its warehouses. Amazon not only limited incoming inventory it's also slow down the speed of products headed out for prime customers the default one day shipping is highly delayed in many regions as warehouses around the country faced backlogs amid supply chain challenges some have had to be temporarily shut down for cleaning and had workers walk out in protest following reports of hundreds of infections and a handful of worker deaths. This is the fourth in known case of an Amazon worker that has died of the virus Amazon has declined to provide total nationwide numbers but as you said this adds to mounting pressure if you're not a prime customerAmazon hired 100000 more workers in March and another 75000 in April they have made a promise to the shoppers and they're charging them dearly for it with an annual fee and they're not living up to that one way Amazon is trying to improve shipping times is by putting a halt to shipping any non Amazon packages in the US it had been ramping up the shipping service to compete with UPS and FedEx.
Amazon has been ordered to slow down business, the government in India has prohibited Amazon from delivering nonessential items all together in. in France a court ruling shut down all Amazon warehouses for weeks only allowing them to re open for shipments of a specific list of goods. Amazon is trying to free up the shipping bottleneck is by encouraging some sellers to ship items themselves. Amazon has pushed the growth of the filled by Amazon the program where sellers pay a fee for Amazon to prepare and ship their products with the prime package but the system is less speedy now some days a product will list as a 30 day shipping time with with FDA and other days.
Walmart is one competitor that's also had a surge in demand it's seen a record number of downloads for its grocery shop and hired more than 150000 workers weeks ahead of schedule at the end of April. Walmart launched express delivery where shoppers pay an additional $10 surcharge for guaranteed 2 hour delivery on 760000 items. Amazon also ended a policy it's set in place in March that allowed warehouse workers to stay home without pay and not face penalties for being absent. Amazon will likely be able to continue to scale up its warehouses scale this last mile delivery at some point when we do start to re engage and was all probably have too much excess capacity we'll have to scale back on some of that capacity they built. Bye for now Amazon is going full throttle to catch up so it can once again operate like every other business and get you to shop more instead of less. Once we get out of this crisis Amazon will be in a position to bring these customers back the pie post Kobe is going to be so much bigger for E. commerce but I don't think Amazon's too concerned about it at this early stage they've done what they've had to do it will end at some point I don't know when but when it does they're going to be 10 times stronger than they were when they started and no doubt.