Amazon’s influence doesn’t stop at e-commerce

What is the “political” message of your book?

I am moved by a loss of control over the structuring of consumer markets. The positions taken by the digital giants are worrying. The interface between digital and commerce has remained under the radar of the government. But also retailers who have remained passive towards this phenomenon, who have been naive, who have invested little… The problem is that Amazon’s influence does not stop at e-commerce. It is a focal point for colonizing other aspects of consumption and lifestyle. Starting with physical commerce and even entertainment… With this work, I wanted to contribute to awareness of the need to act quickly to avoid the stranglehold of consumption by a handful of world-class foreign companies. It is a threat to our economic sovereignty.

“The interface between digital and commerce has fallen under the radar of the government. †

In what way does this topic of the platformization of consumption “worry” the economist you are? What does this say about the evolution of our society?

The consumer world was once disrupted by mass distribution. It is revolutionized again with the emergence of virtual marketplaces. They quickly impose a new rule of the game, a new market organization in itself is not a problem. On the other hand, digital platformization and the arrival of new intermediaries worries me. If not monitored and controlled, there is a risk that it will lead to dominant positions which, once installed, are very difficult to break. We’re still a long way from Microsoft and Windows…

You quote staggering numbers: 62% of global e-commerce in 2020 took place in the top 100 global marketplaces.

There are two topics. On the one hand the influence of marketplaces on e-commerce and on the other hand the place of the leaders in this market. Market activity grew twice as fast as e-commerce as a whole. In 2020, Amazon made $386 billion in revenue. For comparison: CA. Carrefour world is 83 billion dollars. In China, Alibaba, founded in 1999, has already earned $109 billion in 2020 (981 million Chinese customers and 240 million outside China). There could be a head-on clash between e-commerce titans on European soil in the coming months.

What could stop this evolution…

The ability to curb the phenomenon depends on the ability to invent something else. The alternative to the dominant marketplaces is: “go alone” with the creation of a commercial site (there are more than 200,000 active sites in France), the launch of specialized or local marketplaces…

… the consumers themselves? These platforms are criticized for their working conditions, their environmental footprint… Any project to set up an Amazon warehouse in France is subject to numerous criticisms. Will there not be a revival of the citizen-consumer?

This is indeed one of the limits of their influence. In society, we have moved from a praising Amazon to a more critical view, especially of the working conditions of employees. In our surveys at ObSoCo, we very explicitly observed a refusal to buy on this platform, but it affects only 10% of the French. However, a trend indicates that some of the US site’s clientele is harboring a sense of guilt. It will be continued… because after this mea culpa, the consumer generally prevails over the citizen.

Only 10% of French people refuse to buy on Amazon »

They sure are leaders, but is the fight fair?

Of course not. They are the champions of tax optimization. They pay no tax. There is a form of predation in an economic sense. Selling at a loss on Amazon is financed by the cloud, another profitable business for example. In 2020, Amazon Webservice (IT services activity) weighed 12% in the digital giant’s revenue, but 60% in its operating profit. It’s not very fair to independent booksellers who don’t play on an equal footing… I do recognize Amazon’s genius, but I say we shouldn’t have let it get to that point.

The French prefer the local, the made in France, companies committed to CSR… How do you analyze this contradiction among consumers?

There is a double divide: part of the population is moving towards responsible consumption and another part in the grip of economic constraints. And further, there is a gap in each of us between the consumer and the citizen. Very often the first records ideals and the second reminds us of the limitations.

“The game is still open in food, where having a dense network of stores is a strategic asset,” you write. Is a policy of concentration of players therefore more topical than ever?

Probably, because when we look at the masses at stake, it’s clear that our leaders are dwarfs, eager for profitability and investing little. However, Amazon has never paid 1 euro in dividend and made the choice very early on to invest massively. Walmart is the only one in the world to oppose it because the brand invests a lot in new skills. In France we still have the culture of power; there, however, it is a matter of appealing to a culture of intelligence, of innovation.

Here again, Amazon’s food ambitions (with Amazon Fresh) combined with its logistics know-how will hurt the competition…

Especially because the brand knows how to be patient. Even though it starts slowly in France, she perseveres. French players have a bit of a reprieve as the size of the country doesn’t make it a priority for the US brand. But despite everything, we witness a start of the large food distribution groups that have recognized the importance of digital since the health crisis.

What is the recipe for the success of specialized marketplaces (ManoMano, Zalando…)?

I believe in it because it must be recognized that the shopping experience on Amazon is quite poor. What saves her are the 300 million references on her site. Functionally it is efficient. But there is a symbolic, non-negligible immaterial dimension in consumption. In a specialized marketplace we can conjure up a whole concept of consumption. The shopping experience is richer and more meaningful, with the involvement of communities. This is the real difference with Amazon. But even Decathlon or Leroy Merlin arrive a little late…

What are the strengths of the DNVBs in this new organizational form?

There are many candidates and few elected officials who can be visible without being established in a marketplace. Some brands present in different sectors (Le Slip Français,, Loom, Tediber, etc.) enter the market from a limited product category and want to maintain full control over the distribution of their products and the customer relationship. pOne of their strengths is a strong presence on social networks and with influencers and a form of conspiracy with the consumer.

What do you think are the alternatives for e-merchants to Amazon?

They have to invent something else and be part of the next move. E-commerce has already evolved in its forms and will continue to evolve. The ones that can seriously challenge Amazon are, of course, the other digital giants (Google, Facebook, etc.). parallel existence, the desire to buy must be aroused by addressing the person rather than the consumer. In that sense, social commerce is an alternative track. Social media can help small players. But we need to be forward-looking and invest, because we are far from the end of the reinvention of digital commerce.

You also mention service models…

The market relationship is thereby based on delivering beneficial effects and contributing solutions to problems faced by customers. This is the case with BMW-Daimler, which is moving towards “mobility as a service”, Leroy Merlin and Decathlon, and even Somfy, which has moved from motorized shutters to home automation equipment.e. These new services force consumers to stay in the brand ecosystem and thereby develop revenue streams over time.

What remains of the post-Covid period in consumption?

The opportunity to accelerate the transition to greater respect for the environment seems to have passed. With the return of inflation, the whole issue of purchasing power (and ‘purchasing power’) is surfacing again, especially in this context of the election period. This won’t help us turn the hyper-consumption page. We stand at the antipodes of the sobriety we would need.

His journey

1988: Doctor of Economics at the University of Paris 1, Philippe Moati joins CRÉDOC

1998: Professor at the University of Paris-Diderot, where he directs the master’s degree course “Consultants and responsible for socio-economic studies”.

2011: Participates in the founding of the Observatory Society and Consumption (ObSoCo).

2014: member of the Guidance Council of the BPI France “lab”.

Leave a Comment