Can someone snubbing your brand hurt your stock prices? Well, if that person happens to be Jeff Bezos, yes, it certainly can!
The Amazon head threw some shade at his online rival in his annual letter to shareholders, saying:
“Third-party sales have grown from $0.1 billion to $160 billion — a compound annual growth rate of 52%. To provide an external benchmark, eBay’s gross merchandise sales in that period have grown at a compound rate of 20%, from $2.8 billion to $95 billion.”
This tacit implication that Amazon had drastically outperformed eBay from 1999 to 2018 was seen and read by a lot more than just shareholders, and is actually being attributed to a nearly 5% drop in their stock, and fell to $36.00 in the afternoon.
With shots fired, eBay CEO Devin Wenig responded on Twitter by sarcastically thanking Bezos for the ink and adding, “We don’t compete with our sellers. We don’t bundle endless services to create barriers to competition.”
At the same time, Bezos also raised the ire of Walmart by challenging its competitors to match Amazon’s $15.00 an hour minimum wage for all of their employees.
Bezos also went as far as to call on his competitors to raise their minimum wage to $16.00 an hour, which would force him to raise Amazon’s and that this type of friendly competition would benefit everyone involved.
No competitors were called out by name, but Walmart’s executive vice president of corporate affairs, Dan Bartlett still shot back, “Hey retail competitors out there (you know who you are) how about paying your taxes?”
This is an obvious reference to the report in February of this year that Amazon will pay $0 in taxes on $11,200,000,000 in profit for 2018, which understandably raised a lot of eyebrows.
Currently, Walmart’s minimum wage is $11 an hour, which they set back in January of 2018, but they claim that their average worker earns $17.55 an hour with wages and benefits.
There are no publicized plans for either Walmart or eBay to raise their wages at this time, but it will be interesting to see if this creates a ripple effect that makes wages a hot-button issue and forces major companies to set a good example.
Bezos letter to shareholders also touted Fulfilled By Amazon and Amazon Prime as the two key game-changers in separating their offers from everyone else in the digital marketplace. He also lauded the company for “listening to clients” so they can stay at the cutting edge of what their customers really want, which will help push their innovation forward.
He added that they, as a company, need to continue to innovate and create new solutions that their customers don’t know to ask for, saying Amazon needs to “invent on their behalf. We have to tap into our own inner imagination about what’s possible.”
Stay tuned to see if this heavyweight war of words (and tweets) will ignite any more fireworks in the days to come.
