Amazon lost how much on Alexa?

Amazon’s division that built Alexa is on track to lose $10 billion this year. Why? It’s a product with very little utility and is no more than a glorified device to turn on or off the lights.

Alexa is a failure as a product because it didn’t solve any consumer problem. Google is not that far behind, but it also has minimal utility in an era when almost everyone takes their smartphone everywhere.

In the beginning, smart devices would connect us to our whole world, including refilling prescriptions, wondering pizza, and making phone calls. That never happened. I’ve tried all three devices from Google, Apple, and Amazon. By far, the best so far is the one from Google. While I would like it to do much more, it still provides enough information to stay relevant. Apple’s is so bad I sent it back after a week.

If these intelligent devices gain market share, they must provide a clear and concise benefit. They are too difficult to set up with various brilliant light bulbs and other devices. Every time I unplug a lamp in my family room, I must reset it completely. Some lights say they work with Google’s Nest, but you need to download another app and take time to set it up again.

Amazon has lost its focus. Deliveries are taking longer, and the first few pages of search results on Amazon are usually paid advertisements fooling most shoppers. They keep introducing new Kindle devices when. I can read my Kindle books on my iPad or laptop. In the meantime, Wal*Mart is slowly taking share from them.

One of the critical weaknesses for Amazon’s ambitions to be in the business of nearly everything is that it doesn’t own a platform. It doesn’t control a PC operating system like Microsoft or Apple. It doesn’t have a mobile platform like Google’s Android or Apple’s iOS (even Amazon Fire tablets just run a modified version of Android).

On top of this mess, Amazon is one of the companies investing billions in online healthcare. Do you really trust Amazon with your healthcare data? I sure don’t.

I’ve gradually moved away from Amazon in favor of Target and Wal*Mart. Now that Amazon has said they will start advertising on Twitter again, I intend to let my account lapse and not stay a Prime customer. How many will more people do this? I guess not many because it’s just too easy to buy from Amazon.

About richmeyer

Rich is a passionate marketer who is able to quickly understand what turns a prospect into a customer. He challenges the status quo and always asks "what can we do better"? He knows how to take analytics and turn them into opportunities and he is a great communicator.

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