InformationWeek: The Business Value of Technology

Launched a year ago, Amazon Auctions is representative of Amazon .com's expansive strategy. Amazon.com opened its doors in 1995 as a bookseller, but now peddles everything from toys to clothing.

Amazon Auctions "is a very important merchandising tool for the company," says Mike May, a senior analyst in digital commerce at Jupiter Communications. "It allows them to sell a huge selection of products that their retail operation doesn't carry."

Amazon Auctions features more than two million products, including one-of-a-kind items-such as the tunic actor Russell Crowe wore in the movie Gladiator-new merchandise from its retail sales, even high-end antiques from its Sothebys.amazon.com section.

"We don't want to outdo eBay," says Jeff Blackburn, director and general manager of Amazon Auctions. "Our goal at the beginning was to dramatically increase Amazon.com's selection of items, and we are very happy with how well Amazon Auctions is doing."

For customers who've already given Amazon.com their credit-card information, Amazon Auctions now lets them buy an item they've successfully bid on with a single click. "For customers who are convenience-driven-which happens to be a pretty large percentage of those on the Web-if they've already entered in their payment information, they don't expect to enter it in again to make a purchase," Blackburn says.

Amazon Auctions is also testing a new area, Trusted Brands, to auction off excess electronics inventory from Service Merchandise and excess sports inventory from Gear.com. The feature is an extension of the site's Outlet section, where Amazon.com auctions off its own excess inventory.