How can other online retailers compete with Amazon?

[mandy]

Amazon.com Inc., already the dominant online retailer with more than double the 2007 web sales of its nearest competitor, is widening its lead. Its sales last year grew at nearly double the rate of U.S. e-commerce, 38% vs. 22%,and in the first half of this year Amazon's North American web sales grew by 33% while online retail as a whole grew by only 12%, according to comScore Inc.

Several factors drive this growth. They include Amazon expanding into new categories beyond books and music,more than a dozen in the past year. The e-retailer's free shipping offers and low prices encourage frequent purchases by 81 million active Amazon shoppers. And thousands of other retailers are helping expand Amazon's selection by selling on Amazon even though it means paying a commission and handing over customer data to a competing e-retailer...

The risk to these partner retailers, though, is that Amazon becomes more powerful with each retailer that adds its stock to the Amazon platform, and with each new customer attracted to make a purchase through a retailer selling on Amazon. Those customers become Amazon customers, as retailers selling on Amazon agree that only Amazon can send follow-up marketing e-mails to customers who make purchases at Amazon.com, even if it's a third-party retailer fulfilling the order.

In short, Amazon has created its own virtuous circle: more customers coming to Amazon make it a more attractive platform for other merchants, while more merchants selling on Amazon lead more consumers to start their shopping at Amazon.com...

full article: http://www.internetretailer.com/article.asp?id=27583

[bishop54106]

This article is a list of 7 ways to compete with large Internet retailers like Amazon.  It focuses on products and ways to compete without competing with direct products but finding holes in they're offerings.  http://www.internetretailerblog.com/Blog...Sales.aspx