Home Latest Insights | News The Double Play Strategy – Learn How AWS Now Provides 74% of Amazon’s Profits

The Double Play Strategy – Learn How AWS Now Provides 74% of Amazon’s Profits

The Double Play Strategy – Learn How AWS Now Provides 74% of Amazon’s Profits

In baseball, double play is a defensive play where two players are put out. It turns out that the leading ecommerce companies like Amazon and Alibaba have such strategies in their businesses. Amazon runs an ecommerce operation, which is not super profitable (was a lost maker for years), but makes money via AWS, a cloud computing service. Below is the breakdown of Amazon profit; AWS runs the show now.

For Alibaba, its double play comes from its asset-light marketplace and Ant Financial which processes payments across its ecosystems. Besides the commission for selling on Alibaba, Alibaba takes another cut for handling the payment. 

When you examine these companies, one thing is obvious: no one makes good money by running just an ecommerce operation; you need a double play to supplement it. This double play is connected with One Oasis Strategy which I explained here in Harvard.

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Amazon won ecommerce via Double Play Strategy and we can learn from that.


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