(AMZN) Amazon.com Helps Pick the Right Gift

The largest online retailer Amazon.com Inc. (AMZN), along with MasterCard (MA), introduced a new feature called Friends & Family Gifting. The feature will help customers track the special days of their loved ones and will send shopping reminders. It will also suggest gift ideas for the persons added on the customers’ lists.

The holiday season has already set in and customers are flocking the stores.  Now with Amazon’s Friends & Family Gifting feature, customers can very easily plan the gifts. This feature also helps others to know what their friends want by going back to their Wish List.

Further, Amazon will also integrate this feature with social networking sites such as Facebook (FB), Twitter and Pinterest. Thus, customers can use information from social networking sites and track what their friends would have wanted to add to the shopping cart.

The marketing strategy of Amazon and Master Card could prove to be extremely effective, especially considering the time it was launched. This is the holiday season and people are usually busy buying gifts for themselves and their loved ones at this time.

The Conference Board had reported that the Consumer Confidence Index climbed to 73.7 in November, the highest level since Feb 2008. The Thanksgiving weekend sales also looked promising this year and the National Retail Federation (NRF) noted that sales during that weekend jumped 12.8% from year-ago period. Thus, Amazon will be looking forward to tap the positive sentiment.

According to a survey conducted by BIGinsight, 52.8% of U.S. citizens have already started their holiday shopping. Hence, it makes sense for Amazon to start tapping potential buyers beforehand.

Separately, the world’s largest brick-and-mortar retailer Walmart (WMT) has been increasing its own e-commerce initiatives to keep up with the e-commerce giant Amazon. Through Walmart’s e-commerce innovation lab @WalmartLabs, it has gradually been building a successful online business.

Amazon is by far the biggest online retailer but considering the ecommerce initiatives many brick-and-mortar retailers now have, stealing traffic from these companies could get more difficult. Therefore, the company needs to innovate continuously. The latest initiative is one such step taken by Amazon.

Online shopping has changed the shopping scenario. Customers do go to the retail shops to physically check the products, but they finally purchase it online as they get bigger discounts. Thus, it is very important for Amazon to bring in innovative measures and offer the best to its online customers.

Forrester is forecasting that e-commerce business in the U.S. alone may reach $278.9 billion in 2015. Further, Statistica.com is estimating that the number of online shoppers in the U.S. alone is expected to grow from 137 million in 2010 to 175 million in 2016. In the third quarter of 2012, Amazon enjoyed the leading position, as it was visited by104.6 million unique visitors per month followed by Apple’s (AAPL) site (47.5) million and Walmart (43.1 million).

Amazon’s third quarter revenue was $13.81 billion, up 7.6% sequentially and 26.9% from the year-ago quarter. This was better than management expectations and more or less in line with the Zacks Consensus Estimate. Excluding the unfavorable currency impact, revenues increased 30.0% year over year.

Amazon, Apple, Mastercard, Walmart and Facebook have a Zacks #3 Rank (Hold).
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