Non-Store Retail

Amazon.com, Inc.

The Company

After seemingly much vacillation, one of the most awaited initial public offerings of the year began trading on May 15. Amazon.com Inc., the net's premium online bookseller opened at $29 1/4 .and has since moved to its present level of $18. Since AMZN is sailing through uncharted waters and is in the high growth phase of its business cycle (which renders sequential numbers virtually meaningless), it is safe to characterize Amazon as a highly speculative investment. Normally, "In the Spotlight" attempts to feature companies with the "best" characteristics in each particular group every week, this week IS will settle for the company with the most "interesting prospects." Let's outline some important considerations that will strongly influence the company's success going forward.

How valuable is the so called intangible of brand name? This is important when evaluating Amazon, because many point to brand recognition as Amazon's most valuable asset. The fact that the overwhelming majority of online netizens associate books on the web with Amazon puts the company in a great position. The all important community that Amazon's one-on-one marketing focus fosters is not easy to replicate. Many, such as newly minted arch rival Barnes & Noble will have difficulty replicating AMZN's distribution arrangements as well as its marketing focus. (Go to next snapshot.)

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