Weekly Market Links [27 Sep-03 Oct 2021] - Amazon At Home, Google Builds Walls, Dollar Inflation Looks Set To Stay
Amazon wants to be in your home and in your buying habits. Google starts playing hardball. Dollar stores cost more than a dollar.
We’re trying a slightly different written format to be more mobile-friendly. Received feedback that bullet points are nice on the Web with large screens but are horrid on mobile layouts. Let me know if this is better!
Google has a plan to block cookies on Chrome. This was deemed anti-competitive by advertisers - it is a primary building block to track users wherever they are, and doing so upends a once fundamental tracking method for digital advertisers.
This stance is Google’s way of building their own walled garden, increasing the dependence of advertisers on Google’s infra and tools - namely Gmail, which in most cases, people would have signed them into lots of other software, websites and so on.
More info to come regarding their anti-cookie-to-Gmail strategy! Stay tuned with the buttons below!
Netflix gets sued by South Korea’s telco for causing a “surge of viewers”, namely from the hit series “Squid Game”.
E-Tail / Retail
Amazon introduced lots of gadgets this week. A mobile robot with Alexa-enabled, videoconferencing tools and fitness trackers were seen in Amazon’s latest hardware push.
As of now, the gadgets constitute a really small % of their bottom-line - but we see this as a way to introduce Alexa into the home, and tying with the rest of Amazon’s ecosystem.
Subscriptions, just like AWS, are seen as a key focus. These constitute the Prime membership covering online streaming content, and ease of delivery, of e-commerce packages, groceries and more. Seems like Amazon wants to be pervasive in everything at home and your buying habits.
Dollar Tree starts to sell stuff at more than $1. This was a decision, again, due to rising costs of logistics and being short on some SKU inventories.
It is unlikely that Dollar Tree will reduce those SKUs back to a dollar - and magically, inflation would be “here to stay”, as consumers get used to the new prices.
We have to watch if other essentials start to creep up - first in cents, and overtime, marked up to half a dollar. So much for “transitory inflation”
Apple, Nvidia and Tesla have halted production in China, due to limits on electricity usage. This stemmed from a low supply of coal, while emission standards had been raised.
The heavy industry as a whole has contracted, and costs from both input commodities AND electricity are rising, hurting margins.
Robot (delivery) Wars
More robot couriers are expected in China, as demand grows, with a labour crunch worsened by COVID.
There are already a million human couriers delivering packages for < US 0.47. Yes, in cents. They work without rest to make a living, and still, the sheer volume of deliveries keep growing.
Large players such as JD, Meituan and Alibaba are expected to quadruple their robotic fleet, in a bid to reduce delivery costs by 10-40% in cities
Interestingly, the main costs of delivery robots come from LIDAR sensors. These are also used in some autonomous cars as sensors, and will likely decrease with more production.
We may see some intervention from the Chinese government, as millions of livelihoods are affected directly from such a move.