Amazon UK lands Borders deal
Published: 27 Oct 2004 13:00 BST
High-street bookseller Borders has launched a transactional Web site running on Amazon's e-commerce platform, building on the two firms' existing relationship in the US.
Announced on Wednesday, the deal adds to similar relationships Amazon.co.uk has with other high-street retailers such as Waterstones, and provides Borders with an e-commerce site with a look and feel very similar to Amazon's own site.
In the US the two retailers have had a relationship going back more than three years, with Borders seeing a 50 percent increase in online sales last year compared to sales before the tie-up with Amazon in 2001.
Greg Hart, director for media products at Amazon.co.uk, said there was no real reason why it had taken three years to extend the US relationship to the UK other than that the UK arm of Borders had not approached the online retailer during that time.
The announcement of the Borders deal follows similar rumours concerning talks between Amazon UK and British clothing retail chain Marks and Spencer. An Amazon spokesperson refused to comment on any alleged talks between the two retailers.
"We never confirm or deny what we may or may not do the future, so we just wouldn’t comment on the M&S speculation," she said.
Partnerships with high-street retailers have been important in terms of revenue and marketing for Amazon but there are risks involved.
In June this year, Amazon filed an official request with a US court to end its four-year relationship with Toys "R" US following a legal dispute with the company.
Toys "R" Us sued Amazon.com in May 2004, charging it with violating the terms of the companies' partnership by allowing other vendors to market toys and baby products on its site.
After its own online store stumbled, the toy giant turned to Amazon. In the 2000 deal, it agreed to pay the then rapidly growing retailer a $200 million premium for exclusive rights to sell toys and baby items through its site. The partnership established a template for future growth at Amazon, which has since made similar deals with retailers in the US such as Office Depot, Circuit City.
Amazon announced a 238 percent leap in quarterly profits on 21 October in its third-quarter results. However analysts are concerned over whether this kind of growth is sustainable in the long-term.
CNET News.com's Matt Hines contributed to this report
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