The Week's Winners and Losers: Yelp-Yahoo! Deal, Keurig 2.0
Companies can make brilliant moves, but there are also times when things don't work out quite as planned. From the leading online retailer jacking up prices to a short-term lender coming under scrutiny, here's a rundown of the week's smartest moves and biggest blunders in the business world.
Amazon.com (AMZN) -- Winner
Shoppers aren't going to like it, but Amazon's move to bump the annual price of its Amazon Prime program from $79 to $99 is still a pretty sweet deal. This is the plan's first increase since its inception nine years ago, and since then we've seen Amazon expand its range of self-warehoused products that it makes available to Prime shoppers without charging shipping on two-day deliveries.
Amazon has also made Prime more compelling by adding monthly Kindle e-book rentals and unlimited streaming of a growing library of streaming movies and TV shows.
The 25 percent increase may seem like a lot, but it's a safe bet that the vast majority of its members will stick around and pay up.
World Acceptance (WRLD) -- Loser
Another short-term lender has come under fire. World Acceptance shares tumbled nearly 20 percent on Thursday after revealing that the Consumer Financial Protection Bureau has served it with a subpoena as part of an inquiry into the legality of its marketing or operating practices.
Companies that specialize in short-term or payday advance loans have been criticized for the high rates that they command on cash advances, preying on people without traditional banking services.
Being targeted in an inquiry is certainly not the same as being guilty, but the questions do cast doubts on World Acceptance.
Yelp (YELP) and Yahoo! (YHOO) -- Winners
Yahoo! and Yelp are teaming up to populate Yahoo.com search queries with Yelp's local business reviews. This is a pretty big deal, since Yahoo! isn't known for its breadth of local search offerings, unlike Google (GOOG), which already has its own platform for local reviews.
The deal gives Yelp more prominence, and it will help make Yahoo! a more compelling search destination for those seeking area businesses.
General Motors (GM) -- Loser
GM may have taken too long to call for a fix of faulty ignition switches. It is now at the center of several investigations after revealing this week that it knew about the faulty ignition switches as early as 2001. The company making the defective component claims that a replacement would cost just a couple of bucks to make and is an easy fix for service centers.
Keurig Green Mountain (GMCR) -- Winner
No one has has mastered the art of single-serve java the way that the Keurig platform has. It has revolutionized the lives of caffeine seekers, but a lot of investors may not know that Green Mountain is the company behind the champ of the premium one-cup brews.
%VIRTUAL-article-sponsoredlinks%That changed this week when Green Mountain Coffee Roasters changed its name to Keurig Green Mountain. This comes at an important time for the company. It's getting ready to roll out Keurig 2.0, a new platform that will offer more customized options, including portion packs that make entire carafes of coffee. Keurig Green Mountain will also enter the carbonated beverage market in its next fiscal year via Keurig Cold. A name change may seem to be just a name change, but it's smart way to get consumers and investors to warm up to the brand.
Motley Fool contributor Rick Munarriz owns shares of Green Mountain Coffee Roasters. The Motley Fool recommends Amazon.com, General Motors, Google, Green Mountain Coffee Roasters, Yahoo!, and Yelp. The Motley Fool owns shares of Amazon.com and Google. Try any of our newsletter services free for 30 days.
