Amazon’s Echo speakers sell out during the holiday rush
December 21, 2016 11:57 AM
(Bloomberg)—Amazon.com Inc. sold out of its voice-activated Echo speakers, highlighting the difficulty of correctly predicting demand for the holiday shopping season.
The $180 Echo is out of stock until Jan. 19 and the $50 Echo Dot won’t be available until after Christmas Day, according to Amazon listings. Both products were heavily discounted recently to compete with the newly released $129 Google Home with similar functions.
With the Echo sold out, some people might buy Google’s Home speaker rather than wait for the Amazon devices, said Rob Cheng, head of growth at Elementum, a supply chain software company.
"When there’s an alternative, at least in America, shoppers are more likely to switch to another brand," he said. On Tuesday afternoon, Google’s online store showed its Home speaker available for delivery by Dec. 21 to Dec. 22.
The Echo device may still be available at other retailers, including Best Buy Co. Inc. (No. 12 in the Top 500), Lowe’s Cos. Inc. (No. 27), Staples Inc. (No. 5), Sears Holdings Corp. (No. 14) and Toys R Us Inc. (No. 35), as well as Amazon bookstores in San Diego, Portland and Seattle, an Amazon spokeswoman said. Amazon is No. 1 in the Internet Retailer 2016 Top 500 Guide.
Gauging consumer demand for a product is difficult. Retailers risk losing money by overstocking or missing sales and disappointing shoppers by not having enough items available. The Echo shortage shows voice-activated assistants are resonating with shoppers.
"They’re sold out because of demand, and demand is high because it’s a spectacular product," said Michael Pachter, an analyst at Wedbush Securities Inc.
Amazon has sold 5 million Echo devices since the gadget was introduced in 2014, according to a November estimate by Consumer Intelligence Research Partners in Chicago. The gadget understands voice commands and can play songs, dim lights and order pizza, among other tasks.