Amazon might be a household brand everywhere around the world, but will it continue to remain as successful as it has in the near future?
Of course, those who decide to invest in Amazon will be looking to ask those questions and more, as they will want to ensure that they are in the best position possible when ploughing their own money into the company.
Whilst there are arguably no signs that Amazon will suffer in the future, there is also the possibility of the unexpected, whilst the potential for the bubble that the company find itself in could burst, which would only be considered a disaster.
Recent Amazon Performance
Naturally, with how well Amazon has been performing over the last 12 months, the company will remain highly attractive to those looking to invest.
Amazon saw their share price almost double in the last year and it has recently become one of a very few companies that have a valuation of over $1 trillion.
Current operations make them attractive
Although Jeff Bezos has already decided to step down from his role as CEO in the third quarter of the 2021 financial year and transition into the role of executive chairman, there is every possibility that the company will continue to grow under Andy Jassy, who is set to take over.
Jassy is the lead of the company’s AWS (Amazon Web Services) cloud computing department, which has been a huge hit as Amazon have continued to look to diversify their products and service offerings, such as their Prime streaming service and music streaming services.
Further diversification has continued to take place from the giant company, with a switch to autonomous vehicles, food delivery, grocery retailing – such as stores that do not require anyone to pay whilst in-store with a traditional clerk and just via their app instead, as well as their continuing to improve their internet services.
Four things that can burst Amazon’s bubble
Indeed, these factors certainly make it appear that Amazon are doing all they can to avoid having their bubble burst, although it should be noted that there are still factors that can play a huge role in potentially making that happen.
The first and perhaps the biggest threat to bursting the Amazon bubble is from other big retailers, as this could cause a huge amount of competition.
In America, for instance, retailers such as Walmart (or even Argos in UK) could provide the competition that the online retailer might not like, as both companies continue to show growth and increases in their operations over the last couple of years, whether it be online or in-store.
With many shoppers not enjoying the internet shopping experience and wanting their products as soon as possible, this is a challenge that Amazon will continue to face throughout their existence.
Other factors that could potentially burst the Amazon bubble in the future include things such as government regulations and taxation, with many governments having been rather unkind to online corporations in the past, whilst higher interest rates could also make things a little more expensive.
The continued media coverage about Amazon workers and their alleged poor working conditions could also be detrimental to the company in the future, especially if people do not see change and further evidence that things can be as bad as what others have claimed.
Interesting related article: “What is an Investment?“