Amazon's news that it has signed the ex-Top Gear team to bring the world 'Top Gear 2.0' (The BBC owns the original name) is an inspired move for a company that, let's not forget, began by selling books. For those not familiar with the programme and franchise, Top Gear is acknowledged as being the most popular factual television programme in the world, with an annual audience of 350 million.
Amazon has spent a reputed £160 million on the venture. It might seem a lot, but reference the fact that Top Gear was the BBC’s biggest franchise - worth in excess of £50 million a year.
The accountants should be happy – Top Gear viewing figures peaked at 3.8 million for one episode. If Amazon can achieve half that with people paying an annual subscription of £79 for Amazon Prime, that equates to £150 million in its own right. Not a scientific assessment and clearly some of those will be existing subscribers, but on paper it looks like a good deal – and that’s even before the halo effect on the Amazon brand and increasing its differentiation against Netflix in the highly competitive on-demand broadcasting battle.
So what business is Amazon in?
Amazon is acknowledged as a platform where you can pretty much buy anything. The deal to recruit the 'Top Gear 3' (The outspoken presenter Jeremy Clarkson and his team) takes them deeper into broadcasting and will be followed by other bespoke content produced for them. This gives Amazon an integrated relationship with consumers – watch the programme, buy the book, get the t-shirt and have all delivered (by Drone most probably).
Amazon is a 21st century relationship and fulfilment business. It has achieved what traditional retailers have been trying to do for years. It is now competing with, and impacting, a large number of business’s from multiple sectors. It is a classic example of an industry disruptor. But, could Amazon's biggest vulnerability be that it is fighting a multi-front battle?
Amazon doesn't appear put off by the prospect of fighting on many fronts. Indeed, I wouldn't be surprised if Amazon’s next move was in financial services. Returns can be very good for companies that get it right. This is an attractive sector for tech companies – Apple Pay / Near Field Communication (NFC) payment etc. Amazon already has a loan scheme for sellers. It has the relationship and trust with consumers – both of these are the foundation of strong financial services products.