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Cloud computing is a growing $300 billion business, with Amazon a key player having 28% of the market. It competes with Google and Microsoft in cloud computing. Andy Jassy has built the cloud computing business with $51 billion in sales. It generates 10% of sales in the final quarter of 2020 for Amazon but over half the profit. Renting out server space and software to customers is a profitable business compared to online retail. Sales of $12.7 billion in the final quarter of 2020 generated $3.6 billion in profit. And growth a brisk 28% over the prior year quarter.

Satya Nadella ran the cloud computing business at Microsoft before becoming CEO. IBM named a new CEO from this business that revived growth. Now Andy Jassy is promoted to CEO at Amazon in the sequence of new CEO's from cloud computing.

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Online shift hit Macy's hard. It is now closing 150 stores by 2026. Macy will concentrate its resources on its remaining 350 locations including the Bloomingdale stores and BlueMercury stores. Salez stagnant at $23 billion profits down by 91% to $101 million. Workforce cuts of 3.5% planned and no plans to sell the company to venture capitalists.

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Advertising revenues increased for Google, Facebook and Amazon in 2020 as these three companies took over 50% of total ad revenues in 2020. Large companies shifted more ad spending from television and print media to digital in the pandemic after finding the return on ad spending was increasing on digital. Smaller companies including the jump in startup companies increasing from 300,000 a month over the decade to 500,000 by July 2020, put all their ad dollars into digital. The result is that the pandemic has given the 3 digital companies a dominant role in the advertising economy. More time spent in front of computer screens, more ec-commerce, new business formation, and tech companies ability to steadily increase return on ad investment, has produced strong revenue generation. The pandemic had the effect of increasing retail purchases online from 10% to 16% in the second quarter of 2020. Biscuit maker Mondelez found that return on ad spending was 25% higher on digital compared to television and now spends about half of its $1.1 billion ad budget on digital. Trendy garment makers are seeing returns on ad spending that are high with quadrupling of sales following a doubling of ad budget for active apparel maker Vuori of California. Small advertisers such as Vuori are the reason digital ad spending has remained strong for Google, Facebook and Amazon. For furniture maker Steelcase in Michigan the return on ad spending on digital using Amazon made up for the lack of sales from its brick stores. It increased online staff from 2 to 25 and was able to bring in $30 in sales dollars from $1 in digital ad spending. ...

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How a small business like Tiny Prints which makes high end greeting cards -from the likes of which Google gets most of its revenues of $11 billion in the USA and $22 billion globally- manages its search marketing budget. This is the way a business like this gets online clicks and sales. Google search ads act like a huge hose over the internet commerce place to generate clicks and sales for online companies.

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Google's head of operations in India, Rajan Anandan, cites estimates of 200 million new internet users in India by 2014. An estimated 100 millon Indians were online in 2010. The surge in internet use is expected with the roll out of high speed internet technology and expected sales of low cost smartphones using Android software. Most of the Indian advertising dollars go to print and television advertising. As a result online advertising spending is only about 200 million dollars. One aspect of Indian user behaviour is the preference for the internet as the first source for research when it comes to buying cars or other products. Google has 63 million Indian users for its search service, according to ViziSense, an Indian web metrics firm. Anandan says Indian advertisers could benefit from an Internet first strategy to reach affluent urban consumers.

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This report in DW.com show the level shopping spree has reached in China. A 24 hour Singles Day on November 11 is a day for online shopping spree in China. It was started in 2009 and reached about $18 billion in 2016. About half of China's population has mobile phones and 90% of sales are on mobile.

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One in every 12 women or 2 million will be a victim of some form of sexual violence in England and Wales every year a police chiefs  report says. One in 20 adults or 2.3 million will be perpetrators.The alarming scale of violence against women and girls is shown in the national analysis for England and Wales of the National Police Chiefs Council. Violence against women has grown 37% over 5 years. Two million women are affected, says NPCC, from stalking, harrassment, sexual assault and domestic violence. And people involved are getting younger. Police chiefs are demanding that tech companies take down extreme material and warning about the influencers who are "radicalizing" men online. The attitude and culture towards violence in general has deteriorated in the UK and the US, and the violence against women of this magnitude shows that a lot of work will be needed to change this attitude and culture. It truly is a National Emergency in the UK and in the US. ...

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WSJ's Christopher Mims shows the failure of tech startups in low margin industries in which the startups added little real innovation. What he does not say is that these so called "tech startups" have caused a massive capital misallocation and poor productivity of capital for trillions of dollars of American savings. This  happened when the productivity of capital for infrastructure and manufacturing industries in which the US has fallen behind is increasing. It has also caused "crowding out" of essential government investments in infrastructure and manufacturing in the US. In food delivery, used car delivery, online streaming and a whole range of business startups sales are falling as consumers hit by high inflation are budgeting carefully for all expenses. Many are disappearing after years of losses leaving a trail of destruction that includes the unrealized infrastructure and manufacturing that America's communities so badly need.  ...

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Best Buy sales increase by 3.4% in U.S. stores for the nine weeks of the 2014 holiday season through Jan. 3, and online sales increased 13.4%, with the improving U.S. economy. Sales were higher for newer flat screen televisions and smartphones as customers made replacement with new models. The outlook for 2015 remains uncertain because of volatile exchange rates and declining electronics prices.

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In India 70% of smartphones sold in 2015 cost less than $150. Apple's market share in India is really small at about 2%. Apple iPhone sales were up 56% in the 1st quarter of 2016 over the same quarter in 2015, according to CEO Tim Cook. iPhones cost about $300-$1000 without a data plan in India reducing the size of the market. In May 2016 Apple applied for approval from the Indian government to sell refurbished or certified iPhones at lower cost. In India the best selling iPhone is the older 5S which costs about $300. It makes up 50% of iPhone sales in India for 1st quarter in 2016, according to Counterpoint. Apple has no model at the low end, as the SE model will cost even more at $500. The Indian market is growing at 26% in 2016 over prior year, making it the next largest market after China. Another approach Apple is taking is seeking approval to open its own retail stores and sell online. A waiver has been given by the government for using locally made parts. Apple's high prices and margins remain a significant barrier in opening up the Indian market, when lower priced Korean and Chinese smartphone models offer attractive options to price conscious Indian buyers....

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A Brooklyn, New York resident who created his own job during the pandemic. A neighbor gave him a used bike she was getting rid of. He sold it online for $400. This gave him an idea- he now pulls bikes from garages and barns all over the U.S. and restores them to new. Because of the virus related manufacturing slowdowns for bicycles, and people preferring bikes to trains demand has jumped. U.S. bicycle sales at $2.6 billion up 81% and use of city bicycles up 141% in New York city for Citibike- with single trip pass buyer at 516,000. Mr. Van Scyvoc a 33 year old Brooklyn resident collects bikes around Cleveland where his father a retired firefighter lives and takes them by pickup truck to a bike stand he has at Fort Green park in Brooklyn. There he sells bikes bought for $80 to $250 for $300 to 500. First he has to have them washed clean and then serviced in Brooklyn by an IT engineer who now repairs bikes.

 

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Best Buy electronics retail chain plans to close 50 big box stores in 2012 and open 100 mobile small format, stand alone stores. This is part of a strategy to reduce costs by $800 million by fiscal 2015. Total sales at stores open at least 14 months declined 2.4%. Best Buy competes with online retailers like Amazon.com and discounters such as WalMart. Best Buy's response was to increase online and mobile options for purchases and discounting efforts of its own. This has put pressure on its profits, with a loss in fiscal fourth quarter ending March 3, 2012, of $1.7 billion, which also reflects restructuring charges.

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The Journal's interview with Weight Watchers International CEO, David Kirchhoff. Weight Watcher's strategies focus on increasing its online business and getting males to join Weight Watchers. According to Kirchhoff it has 1.4 million people, 90% of whom are women, attending meetings each week all over the world. Online business is surging, with an average of 1.8 million additional subscribers for the first 3 quarters of 2011. In the first 3 quarters of 2011 the online business showed gains of 70%. Estimates are for the online business to generate $400 million in revenues and $200 million in operating income in 2011. Today 65% of the business is in the U.S. and a large part of the rest is in Europe. Kirchhoff sees new opportunities in China, where poor lifestyles- the use of the internet instead of being outdoors, and the increased access to all kinds of food- is creating a surge in obesity.

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Efforts to save the VW brand in North America as it faces disappointing sales. It lost $1 billion in North America for each of the last 3 years. VW faces perception issues among customers in the USA who read JD Powers surveys. The surveys show VW in the bottom 20% for reliability, quality and service. Its younger customer base does online shopping and compares models and this led to sales declining from 338,00 to 235,000 in 2006. Now Jacoby, an accountant by training, who headed VW global sales and marketing and boosted market share from 18.1% to 20.3% in European car sales, has been given charge of the American operation to get VW to breakeven n North America by 2009. Previous ad campaigns showing VW safety in car crashes and Helg a German dominatrix failed to stir up much interest in Jetta and Passat models.

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The risks of coming up with a higher share price for Chinese social networking site Renren based on Facebook's IPO. Price to sales ratio for Renren was high at 22 before a rally, its even higher at 33, and increasingly risky. Larger operating costs and a less developed online advertising market mean Renren will barely breakeven in 2012. Sina's Weibo microblog has 200 million registered users, larger than the 137 million users for Renren at the end of third quarter 2011.

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Adidas plans to open 2500 stores in China by 2015, including 500 in 2010, up from 112 today. Upscale outlets planned for the larger cities in China. The distribution will widen to 1400 cities by 2015, from 500 currently, by moving to smaller towns and cities in China's interior. Adidas also plans to ramp up its presence in basketball, a sport that Nike emphasizes. In China it will offer the NEO brand in smaller cities, targeting teens with prices about 50% of other Adidas brands. The strategy is to introduce Adidas products to people with lower incomes at lower price points, a strategy being used by Nestle, P&G and Unilever in consumer products for emerging markets. Adidas has opened an online retail store with Taobao.com and plans to bring in $500 in internet sales by 2015. Still North America with 14% growth will be Adidas's largest market, and sales in China are not likely to overtake sales in North America by 2015, according to CEO Hainer.

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Lauren Weber interviews online recruiting company Monster CEO, Sal Iannuzzi. Monster is seeing its business upended by social recruiting, niche job boards, and company career websites enhancements. Its share price is down to $7 from a high of $50. The company is developing its own product for social recruiting using Facebook app. Monster's Iannuzzi is also exploring options for sale of the company.

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This is a story of missteps in retailing that can lead to loss of as many jobs as when large automobile plants close-about 65000 jobs in retail at big box store Bed Bath & Beyond in 2019 down to 32,000 by 2022, and with all stores closing in 2023 all jobs lost. Some of these jobs were replaced with the growth of Amazon in online retailing and warehousing shipment, others permanently lost. Jordyn Holman and Lauren Hirsch of the NYT explain how a major retailer collapses into bankruptcy in 2023. This retail chain started in 1971 thrived on its two founder's concept of building a customer base around a store that piled high the volume of merchandise selection for bedsheets, towels, pillows, kitchen appliances, and offered 20% coupons on brand items. It survived the 2009 crisis and by 2012 its stores were up to 1100 from 350 ten years earlier in 2000. This was a result of 4 acquisitions including Buy Buy Baby and Harmon Stores Its collapse is a textbook case of what can happen. Its financial foundations were weakened by a bond offering $1.5 billion, going into the debt market for the first time.   From its success attracting activist investors and the company according to analysts trying to fend them off. The bond offering was the first step to impending disaster. In 2019 three activist investors won a fight to appoint 4 new board members and hire a new CEO Mr. Tritton from Target.  The big change happening just before the pandemic was the complete change of management with the new CEO. Stores that had made the decisions on what merchandise to buy based on location were no longer allowed to do so. Some stores were closed and there were layoffs reducing employee morale. The big change came to the 20% coupons which was the unique feature of the store getting people back into the store. Coupons were cut back as profits declined. The pandemic introduced new elements of surprise. The supply chains were disrupted, and just at that time new management decided to shift to private labels to increase margins and sales. Kitchen Aid was replaced with private labels. As a result of supply chain disruptions the stores could not be stocked leading to customers moving away, a crisis was brewing. At that very time something concealed the crisis from view. The Biden administration checks to support people during the pandemic led to a sudden increase in sales, a one time spurt. Then as suddenly as the spurt months later a complete dropoff in sales. Management closed more stores, suppliers who were not paid demanded to be prepaid leading to stores being only partly stocked. Bed Bath & Beyond collapsed as its coupons were dropped, its stores poorly stocked, no brand merchandise such as Kitchen Aid, and decisions made at the wrong time including the debt load all taking a toll at once. By the end of 2022 bankruptcy loomed. In April 2023 the company declared bankruptcy after failed efforts to raise additional financing. The same changes also hit Best Buy, another big box retailer, which managed the changes to internet buying by shifting sales to the healthcare sector, and continuing to build on it strengths as a retailer of motivated employees with knowledge of the electronic merchandise. It made it right through the pandemic without the changes in management that happened at Bed Bath & Beyond. ...

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The most important segment with future implications for growth is the young people segment, and here American companies are really weak. Of the "millenials" or people born between 1979 and 1985, those who consider a Ford when shoppng for a small car are only 7%. These are Ford's own numbers according to the Wall Street Journal. Ford and GM are moving their emphasis to small cars. Ford did this at the Los Angeles Auto Show with the new Fiesta arrriving in the market in early 2010, and GM will compete with the Honda Civic with its Chevy Cruze due in August in showrooms. To do this Ford and GM are remodeling their showrooms. To do this 3000 Chevy stores are taking on a new focus on small cars and 26,000 sales people are being retrained by end of 2009. Kurt Mcneil, Chevy's sales chief, says their emphasis is on giving a good response to online customers by having salespeople able to talk fluently about fuel efficiency and compare with Honda and Toyota. For Chevy the showroom remodeling involves having a greeter at the reception desk not a salesperson, this is who one first sees when walking into a dealership. The improvements costing $200,000 to $600,000 per location are being paid by dealers with GM offering financial incentives for the work. The way Ford is approaching it is to use social media like Facebook to a bigger extent. It will send a social media consultant to its largest 800 dealerships or one fourth of all stores to build an online infrastructure to connect to local buyers and offer online updates, videos, and games related to small cars. Ford, GM and Chrysler have only 21% of the small car market, according to Autodata, and Ford has only the aging Focus to offer today. In 10 months of 2009, 19% of 8.65 millon light vehicles sold were small cars up from 14% in 2006, while the percentages for SUV and pickups dropped 53% to 46%. ...

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A food scare for Danone's Dumex baby formula brand in China hurt sales. Danone has decided to swap the Dumex brand for additional stake in China's dairy company Mengniu, for a 12% stake in the company. Danone will focus on ecommerce business in China which has grown rapidly to about 461 million consumers as more baby food products are sold online. About 7% of total sales are from China for Danone. Danone has also decided it will keep the medical nutrition business line because of better future prospects. Earlier Danone sold off its majority stake in a joint venture with Wahaha in China. Business decisions at Danone are made by two executives Mr. Ribaud and Mr. Faber, the CEO. Fresh dairy unit of Danone faces several challenges, including rising price of milk, and margins dropping from 15% in 2010 to 10% in 2014. Fresh Dairy generates over 50% of revenues.