Importance of the Amazon Brand

Brand credibility has no doubt contributed to Amazon’s success in cloud computing, and anything that affects that credibility could have an impact on the company.

Neha Gupta - Author

Oct. 13 2017, Published 11:44 a.m. ET


Amazon controls the largest share of the cloud market

While Amazon (AMZN) could easily absorb the $294.0 million tax bill recently imposed by the European Commission for its business in Luxembourg, these types of issues usually aren’t good for a company’s image.

Amazon operates in highly competitive industries such as e-commerce and cloud computing. It controls the lion’s share of the global cloud computing market, according to Synergy Research Group. Amazon’s cloud business grew 42.0% in 2Q17 compared to 97.0% growth for Microsoft’s (MSFT) in the same quarter. 

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Europe is a coveted e-commerce market

Beyond cloud computing, Amazon depends on Europe (EFA) to grow its e-commerce business. According to Ecommerce Europe, Europe’s e-commerce industry could grow 14.0% this year to 602.0 billion euros (or $685.0 billion). The industry grew 15.0% to 530.0 billion euros in 2016. Growth last year outpaced the forecasts.

Walmart (WMT), whose US (SPY) online gross sales grew 67.0% in fiscal 2Q18 (June quarter), has stepped up competition with Amazon for control of the e-commerce industry. The competition includes Europe, a coveted e-commerce market.


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