Amazon’s toyshop

Hey, it’s Mark in New York. My kids are hooked on the Amazon toy catalog. But first...Three things you need to know today:• Walmart is the l [View in browser]( [Bloomberg]( [by Mark Milian]( Hey, it’s Mark in New York. My kids are hooked on the Amazon toy catalog. But first... Three things you need to know today: • Walmart is the latest to [stop advertising on X]( • E-plane company [backed by Amazon expands]( • SpaceX launched a [South Korean spy satellite]( Amazon Roebuck Since the Amazon.com Inc. toy catalog arrived at my house, my kids read it together at the kitchen table almost daily. Using crayons, they’ve circled products like an abominable snowman princess doll and a lifesize Mario Kart and assembled a Christmas list so expansive that it would be of little practical use to Santa. The [Amazon catalog]( evokes memories of a retail juggernaut from another era: Sears Roebuck. In the late 19th century, Richard Sears and Alvah Roebuck started selling mail-order watches through catalogs sent to Americans’ homes. Sears’ inventory grew to include apparel, appliances, tools and toys, and the catalog’s physical size grew in kind to hundreds of pages. By the 1930s Sears recognized there was an untapped consumer. One hundred years ago it published the first Sears Wish Book, a holiday catalog filled with toys that would be required reading for children over the next six decades. It’s fitting that today’s most dominant online retail company found its way back here. For all the efficiencies and scale the internet offers, there’s probably no better way to reach the world’s youngest shoppers than with an unsolicited mailer featuring a cartoon fox on the cover. (Get ‘em while they’re young, and maybe they’ll be Prime subscribers when they grow up.) The Sears legacy offers many lessons for Amazon. For one thing, setting prices is a complicated process. Because Sears put out so many catalogs, customers would sometimes mail in orders with an outdated price, and so the company’s policy was to charge the lowest one available, according to a 1977 history of the company titled Sears, Roebuck, U.S.A.: The Great American Catalog Store and How It Grew. Amazon’s prices online are constantly fluctuating. Its solution for the catalog was simply to not print prices at all. They’re irrelevant for the catalog’s target market anyway, though the lack of prices is an annoyance for the kids’ financial backers. Setting aside the paper product, there are other surprising parallels between Amazon of today and Sears of a century ago. As much as Sears customers appreciated the convenience of ordering by mail or phone, a lot of times they still wanted to go to a store. When Sears department stores were ubiquitous, most customers would elect to pick up their orders in person, a behavior the company would eventually encourage, in part because people tend to buy more stuff they see in the store. At its height one in five Americans shopped there regularly, according to The Big Store: Inside the Crisis and Revolution at Sears, whose author, Donald Katz, happens to now be an Amazon employee. Amazon, too, decided there was value in physical retail. It paid $13.7 billion to acquire Whole Foods Market in 2017 and outlined big ambitions this year for [Amazon Fresh grocery stores](. Lately it’s been nudging customers online to pick up their orders at a nearby Fresh store and is offering coupons as an incentive. But, as Sears discovered, physical retail operations are expensive. It tried to offset the difference in profit margins by marking up the prices in-store. Many customers caught on, though, and would simply go home and order by phone after browsing in the store. Amazon Chief Executive Officer Andy Jassy has taken steps to solve the problem recently. He [closed the company’s bookstores](, mall kiosks and 4-Star locations, which stocked the same items available on Amazon.com. Jassy is instead focusing Amazon’s retail efforts on the things people typically don’t do online — buy groceries and seek [medical attention](. While Amazon hasn’t reinvented these activities, it’s using them as a way to engage customers it wouldn’t otherwise reach and reinforce its online businesses through, for example, in-store pickup and returns and prescription drugs by mail. All of this is designed to keep Amazon from ending up like Sears — another object in the dustbin of retail history. —[Mark Milian](mailto:mmilian@bloomberg.net) The big story Meta said there has been [no major drawback]( to sharing its AI technology through open-source models. One to watch [Watch the Bloomberg Technology TV analysis]( of the Tesla Cybertruck. Get fully charged TikTok is trying to stall EU action on the [Digital Markets Act.]( Syrup Tech, an AI startups that provides tools to fashion retailers, [raised $17.5 million]( ahead of the holiday season. Airbus has a high-altitude aircraft, ready to [challenge Elon Musk’s SpaceX](. More from Bloomberg Get Bloomberg Tech weeklies in your inbox: - [Cyber Bulletin]( for coverage of the shadow world of hackers and cyber-espionage - [Game On]( for reporting on the video game business - [Power On]( for Apple scoops, consumer tech news and more - [Screentime]( for a front-row seat to the collision of Hollywood and Silicon Valley - [Soundbite]( for reporting on podcasting, the music industry and audio trends - [Q&AI]( for answers to all your questions about AI Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Want to sponsor this newsletter? [Get in touch here](. You received this message because you are subscribed to Bloomberg's Tech Daily newsletter. If a friend forwarded you this message, [sign up here]( to get it in your inbox. [Unsubscribe]( [Bloomberg.com]( [Contact Us]( Bloomberg L.P. 731 Lexington Avenue, New York, NY 10022 [Ads Powered By Liveintent]( [Ad Choices](