Rumours regarding Amazon.com, Inc. (NASDAQ:AMZN) opening 400 physical bookstores has been put to rest as Sandeep Mathrani, CEO of General Growth Properties, who was the original source of the news is retracting his comments publicly.
General Growth Properties, based in Chicago is a company that runs malls across America. It issued a statement that Amazon would establish hundreds of physical stores was not meant to represent the e-commerce giant’s plans.
Mathrani’s statements on Tuesday led to many stories emphasizing the irony of Amazon potentially entering the very business that it had a hand in upsetting. The company popularized the concept of ordering everyday domestic items. Now buyers are more likely to purchase a book, from a computer or a smartphone rather than going to physical store.
Amazon says its policy is not to comment on rumors.
An analyst for Morningstar Research, R.J. Hottovy, who monitors Amazon, dubbed Mathrani’s original statement as puzzling. He opines that investing in bookstores doesn’t fit into the concept that Amazon has been espousing successfully.
According to him, last year the company did so well was because of its investment in the core parts of the enterprise such as e-commerce, logistics, Amazon Web Services and others. To have them going against such a strategy is unlikely.
Editor-in-chief of Shelf Awareness, John Mutter, who writes about the industry, says that there is little truth to the rumor regarding the stores, but only that. According to Mutter, Amazon is going to open some more stores, but the number of stores reported is exaggerated.
Insiders have long been aware of Amazon’s intention to open stores, but they say that the number will be about a dozen over the coming few years. Mutter says, it’s not an exaggeration to believe Amazon would invest in physical stores. E-book sales have flattened out and are popular for niche utilization. However, printed books are witnessing resurgence.
Amazon stores stocks only a limited number of titles. Much of the store is dedicated to showcasing the Kindle, the Fire and other devices of the online retailer. The store is designed to encourage browsing as well as buying online by only displaying prices when the title is scanned on a phone or at a kiosk.
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