First, does the product have a network? Does it connect people with each other, whether for commerce, collaboration, communication, or something else at the core of the experience? And second, does the ability to attract new users, or to become stickier, or to monetize, become even stronger as its network grows larger?
Amazon guards its GMV closely, but we can estimate it using a "sum of parts" approach. We need to make two key assumptions. First, assume that Amazon's return rate for e-commerce sales is 15%, which is high for some categories (books, electronics) and low for others (apparel). That implies an e-commerce GMV of $12 billion [=$14b*0.75/(1-0.15)]. Sec... See more