From food to disinfection equipment, packages shipped by Amazon become life buoys for those who shelter at home when the Covid-19 outbreak broke out in the United States.
However, e-commerce is not the only booming field for Amazon at the moment. Its cloud-based services, such as Amazon Web Services, have grown tremendously as the number of users of large customers like Zoom and Netflix has skyrocketed.
CNN quoted James Bailey – professor of business management at George Washington University – said the longer of the Covid-19 in the US, the more Amazon’s position will become “solid”. “Every crisis creates a void. Any company that fills that gap will strengthen,” Bailey said.
According to research by Bank of America, Amazon is not the only group “living well” in Covid-19. This crisis has a positive impact on the entire e-commerce industry. This sector grew by 16% in March compared to a year ago.
Experts say that because of its size and efficiency advantages, Amazon benefits from Covid-19 more than its competitors. Although management costs are tied up, the company of the world’s richest person Jeff Bezos can still earn an additional $ 4 billion in revenue in 2020.
Massively recruiting workers
The increasingly important role of Amazon in the American consumer life made Washington pay attention. CEO Jeff Bezos has been in constant contact with the White House since the outbreak of Covid-19. According to CNN , US President Donald Trump needs Bezos and Amazon more than ever.
Amazon’s changes in e-commerce service can be clearly seen. The group has built a reputation for high-speed delivery, including current scarce items like hand sanitizer, toilet paper and digital thermometers.
Jay Carney, senior vice president of Amazon, said the volume of orders it has to handle many times higher than the holiday season. Currently, Amazon has nearly completed hiring an additional 100,000 workers to help meet demand.
However, this boom also has implications, especially for frontline workers. Many people predict Amazon will open more hiring sessions when many of its workers are infected with Covid-19 or temporarily isolated.
More than 12 Amazon facilities in the US have employees infected with Covid-19. Many workers staged demonstrations to protest the group’s failure to meet labor safety standards.
An unnamed employee at JFK8 facility, Staten Island (New York), said: “Many packages have been returned to the warehouse. We currently do not have enough staff to transport them.”
Not only JFK8, employees at many Amazon facilities across the United States are complaining about body temperature checks, the lack of medical supplies and having to work in crowded areas despite recommendations for social spacing. In response, the company said it had continuously sterilized the entire delivery system and bought masks for all employees.
The criticism of Amazon’s labor safety faces the enormous pressure that the group is facing to timely delivery during the outbreak of the Covid-19 outbreak.
Fill the void
Besides e-commerce, Amazon’s cloud-based services make the most of the profits. Financial records show that Amazon Web Services (AWS) accounted for 63% of Amazon’s total revenue in 2019. Justin Post of Bank of America said: “The most popular applications today such as Zoom, Netflix, Slack , Fortnite are all AWS customers. “
The dominance of the e-commerce giant does not stop there. Amazon invests heavily in Whole Food and a separate grocery delivery service called Amazon Fresh. These two businesses easily benefit from avoiding consumers in big shopping malls.
In addition to the demand for goods, the entertainment needs of US consumers also increased. Audible – Amazon’s audiobook system – gives users free access to hundreds of audiobooks. Matthew Thornton, Audible’s global manager, said: “The number of visits spikes. Millions of users around the world use our services.”
Twitch – Amazon’s popular platform, where users can watch live streaming games – also has an increase in traffic and viewership, especially on channels linked to music and sports when most events art and sports directly canceled.
Twitch has always been among the 10 most popular video streaming services. Like YouTube and Facebook, the company had to downgrade video quality in Europe in order to stabilize the site when traffic soared.
Tired of Netflix movies, Americans can afford to spend money on Amazon’s original series or buy more ebooks for their Kindles. The fact that Amazon smart speaker users make more requests at home also gives Amazon more data to better meet customer needs.
The ability to serve remote needs and huge customer database systems has made Amazon the most popular retail machine in the world today. Consumers have little time and money to waste, especially during a pandemic.
Thus, the crisis strengthened the power of Amazon. Compared to smaller and less efficient companies, Amazon has the right size, capital, human resources and relationships with suppliers. “Amazon is clearly the biggest beneficiary of the pandemic,” said Kevin Arquit, an antitrust lawyer at Kasowitz Benson Torres.