So here are two experiences that made me think "screw this, I wish I'd shopped at Amazon". This may just be a UK-specfic experience, but...
1) Samsung Series 9 laptop from PC World, bought from their store in April, came with Windows 8 drivers (I think) that just never worked. Mouse pointer jerking around, it blue-screened within 5 minutes on one boot out of every two. I updated its drivers through Windows, through the Samsung driver update utility ... just hopeless. I tried to use it for about a month, trying to avoid reboots, but eventually gave up and took it back to the shop. Their nice assistant agreed it looked screwed, took it back, and after two phone calls their support people said that because I hadn't made a restore disc, they couldn't / wouldn't do anything with it, and it must have been my negligence that broke it. I am taking them to court for the £900 purchase price to get a refund, after I'd bought a different model ... at Amazon.
2) Bought a £150 model helicopter for a member of staff as a leaving present from Maplin (big electronics component & gadget store), to be delivered to his house. They make a picking error and deliver a completely different, much cheaper product. I call them and say, hey, you've made a mistake would you mind delivering the correct item. No. I must go over to the recipient's house, pick the item up, drive it to the store before they will acknowledge their mistake and get me what I ordered. They generously offer a freepost address for me to send the item back, but I must be sure to go to the post office and get a certificate of dispatch! [if you've never been to England this generally involves driving into town, queuing, finding it closed for lunch etc.]
I know from for 1) Amazon would take the item back without question, and I'd be confident enough ordering a replacement on the same day, giving me what I want sooner. And for 2) again, I know they would send the right item out without question and tell me to keep the mistake, it's nor worth the restocking fees.
So whenever I hear "Amazon driving retailers out of business" what I really hear is "Amazon showing how it's done by treating customers as honest & impatient, competitors continue to fuck it up". Amazon aren't even the cheapest, or even the easiest web site to find what you want, but I do know that they care about customers getting what they want quickly, and often that's why I'll pay a bit more.
Is this unfair to ALL OTHER retailers? Am I forgetting some intangible Amazon magic here?