No longer content to be the proprietor of the uber-Internet store, Amazon.com’s Jeff Bezos is now building his own ‘Net mall.
As of today anyone can set up his own store in Bezos’ network of “zShops,” selling anything from Florida timeshares to maternity clothes,” the Amazon CEO and founder said. (Only guns and live animals will be prohibited.)
Amazon shares soared a whopping 23 percent, or 14 to 803/4.
Amazon will also handle credit card payments for any stores that want the service.
And to top it off, Bezos announced a new shopping search engine that will lead shoppers only to retail sites.
He called the new programs “a win” for customers, sellers and Amazon, saying, “This is all about saving time and money and finding what you want.”
“They’re positioning themselves to compete with AOL and Yahoo!,” said Mark Rowen of Prudential.
“And since the market cap of those companies is much bigger than Amazon’s, I think this gives them a lot of room to grow.”
Internet portals like AOL and Yahoo! have a head start on Amazon.com in the shopping mall area.
Yahoo!, for example, says its 6,000 stores now offer 3.75 million products. Amazon.com will debut the Z-shops selling 500,000 products and would not say how many stores that represents.
But what makes Amazon.com’s shops different, and what is winning praise from analysts, is the way it is handling credit card transactions.
Repeat Amazon.com customers can already use its “1-click” technology, which “remembers” names and credit card information, to purchase books and music with a click of the mouse.
Amazon will now extend that to any shop that wants it – and is willing to pay for it.
Sellers will pay Amazon $9.99 a month to set up shop, plus a 2- to 5-percent charge on every item sold.
If Amazon handles the credit-card transactions as well, sellers will pay another 60 cents per transaction, plus 4.34 percent of the transaction.
“I think this will be a very profitable business,” said Anthony Noto of Goldman Sachs.
Bezos refused to say when he expected the service to be profitable and rebuffed questions about when the company as a whole would move into the black.
And he also put to rest, for the moment, rumors that Amazon.com was going to make its move on land, setting up in-store kiosks for returns. He called the idea “uneconomical and not good for customers.”
Bezos also made it clear that despite his new role as mall-owner, Amazon.com would continue as a retailer.
“We will continue to invest in areas we feel are under-represented on the web,” he said.
Some competitors called that a conflict of interest.
“Amazon.com sells themselves – so if they are going to do distribution as well, are they going to send customers to themselves or their stores?” asked John Briggs, director of e-commerce at Yahoo!