Is Amazon.com, Inc. (NASDAQ:AMZN) Bleeding Cash?

Posted by Michael Korte September 30, 2013 0 Comment 5680 views


Upping the ante in the tablet wars, Amazon.com, Inc. (NASDAQ:AMZN) has upgraded its Kindle Fire devices and added a “Mayday” button to offer technical support to its customers for free. Many believe that the new feature is revolutionary, but at the same time some analysts feel it could turn out as a disaster for Amazon.com.

The ‘Mayday’ button offers on-device tech support system helping users learn to use the Kindle tablet. For assistance, customers just need to simply tap the Mayday button in Quick Settings and an expert will appear on your Kindle Fire HDX tablet screen and assist and walk you through any feature by drawing on the tablet screen. The company promises to offer response time of “15 seconds or even less” with round the clock assistance all 365 days. This all would be provided at no cost.

However, the ‘Mayday’ feature is termed “revolutionary” in the tablet world believes many analysts, but at the same time some feel it could turn out as a disaster for Amazon.com.

The feature is expected to help the world’s largest online retailer to stand out from other tablets in the market such as Apple’s iPad and Google’s Nexus. The feature could help many non-tablet users own one, as learning how to operate a device would no longer need users to Google anymore and get the assistance on the go. It is seen as a clever move by Amazon to woo new customers.

On the other hand, some believe it could raise security concerns and could allow access to the device and its owner. To this, Amazon.com, Inc. (NASDAQ:AMZN) said the tech support would be a one-way video feed and so the tech advisor would not be able to see the tablet owner, and if users want they can also disable the feature. According to some this will even turn Kindle into money loser.

Bram De Hass in his Seeking Alpha said below mentioned things:

“Amazon.com, Inc. (NASDAQ:AMZN) is focused on making the online shopping experience as smooth as possible: 1 clicks ordering, fast delivery, free delivery and let’s not forget an easy to navigate site. This feature fits perfectly within that smooth ordering experience.

The feature is remarkable. At a time when we are used to customer service requiring you to wait a long time, forward you several times if the question is somewhat complicated and speaking from my own experience in general being an ordeal. I think customers will appreciate this fresh button and it will add to the Amazon.com, Inc. (NASDAQ:AMZN) brand as being on the frontier of customer service.

Amazon.com, Inc. (NASDAQ:AMZN) is not playing the mass market game with the tablet. It is just not as advanced and attractive to the mass market as some of the offerings of its competitors. It is implementing a strategy of appealing to a small demographic with its tablets and slowly growing a user base from there out.

Because its tablet is designed with this customer base in mind, it is not appealing to the tech savvy crowd and slow to become adopted.

The Mayday button may help the Kindle to make some gains. It solves the adoption problem of the Kindle not being something technology minded people will get excited about.”

The company has not yet released sales data for its Kindle tablets. However, the sales figure is not too positive for the company, if the market research firm IDC is to be believed. According to IDC, the Kindle has a tablet market share of 4.6% in the US.

So, it’s too early to say if ‘Mayday’ could help Amazon expand its market share and will be successful enough to give sleepless nights to its rivals.



About Michael Korte

Michael Korte an investigative reporter at GDP Insider and is a breaking news reporter. Michael work includes investigations of misconduct by federal prosecutors and industrial air pollution around the nation's schools. His reporting has been recognized with the Hillman Prize for Newspaper Journalism, the Grantham Prize for Excellence in Reporting on the Environment, and the Philip Meyer Journalism Award for reporting that incorporates social science methods.

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