http://www.dailytech.com/Newegg+Guns+for+Amazon/article11566.htm
The new NewEgg site is http://www.neweggmall.com and it is in beta at the moment. Currently I don't think it is anywhere near as usable, friendly, or product-rich as Amazon. But NewEgg has been very successful in the consumer electronics segment and they will probably exit their beta phase as a pretty interesting competitor.
Amazon should keep close tabs on NewEggMall as it could potentially shuttle standard NewEgg customers into NewEggMall, purchasing more than just electronics. Here is a breakdown of their strengths/weaknesses. The NewEgg strengths and weaknesses will probably transfer into NewEggMall, although hopefully they will improve their weaknesses.
NewEgg strengths:
- Excellent customer service
- Powerful rating system
- Powerful search function that "homes in" on the item qualities you care about
- Fast 3-day shipping at good prices
NewEgg weaknesses:
- Mostly deal in electronics, unproven "non-tech" e-tailing
- No auction systems / user selling systems
- **70%+ of revenue comes from repeat high-tech buyers
Amazon strengths:
- Powerful rating system
- User learning with"Personalized Recommendations" after you purchase items
- Large user base
- Free shipping over $25
Amazon weaknesses:
- Low margins already, so can't drop prices much lower
- Not all items are sold "in house" and free shipping doesn't apply to everything
An important thing to realize is that Amazon does not generally make a lot of mony. NewEgg has continually been profitable since their inception. Amazon is relying on eventual volume sales and if NewEgg erodes even a portion of that, it can be very painful for Amazon.
