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 Technology Stocks : Amazon.com, Inc. (AMZN)

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From: ig3/20/2012 12:34:14 PM
1 Recommendation   of 161295
 
AMZN's pushing up thru 188 now.

Why are Wal-Mart Customers Fleeing to Amazon?
By Aabha Rathee
March 20 2012


The bargain-hunting customers of Wal-Mart ( NYSE:WMT) have discovered Amazon ( NASDAQ:AMZN), leaving the retail store chain worried. According to a research by Kantar Retail, half of Wal-Mart’s customers now shop at Amazon, compared to just about a quarter five years ago.

With its traditional shoppers getting increasingly tech-savvy and the ones who had been flocking to Wal-Mart during the recession going back to Amazon, the store think-tank is having to rewrite its web strategy. “Amazon has moved from being this unusual niche competitor for Wal-Mart to a force that can reinvent the industry,” Kantar analyst Bryan Gildenberg told Bloomberg. “Young people are tech savvy and they’re unemployed, too. The affluent shopper is trading back out of Wal-Mart and Amazon is a bigger part of their life than before.”

A separate market research by ClickIQ found that more and more customers who used a smartphone to research a product at a retail store website ended up purchasing the item from an online-only retailer. Wal-Mart was losing 24 percent of the respondents to Amazon.com, with only 10 percent making the purchase at walmart.com. Around 26 percent were going to a physical Walmart store to make the purchase.

Best Buy ( NYSE:BBY) retained most sales, with 35 percent of those who researched on its website buying at a Best Buy store and another 14 percent purchasing at bestbuy.com. Amazon got 21 percent of the customers. Of those who did their research at Target ( NYSE:TGT), 29 percent purchased the item at a Target store, 8 percent bought it at target.com and 21 percent bought it from Amazon.

“Amazon is always in our sights,” Jeremy King, the chief technology officer of @WalmartLabs, told Bloomberg. “In the U.S., Amazon is a very big competitor. My biggest issue is playing a catch-up game.” In its last fiscal year, Amazon posted 41 percent revenue growth compared with 8 percent at Wal-Mart.
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