Because you can't compete with them.

They subsidize their retail business through AWS which makes it impossible to compete on costs.

Their service is already impeccable, because again, they don't care about cost.

Their logistics infrastructure is second to none as they now have decades of experience, development and amortized costs.

It goes on and on and on. Basicly, outside of state subsidized companies like those in China, there is no way to compete with Amazon.

The only ones that could possibly try (and do) are established retailers such as WallMart but those have the disadvantage of old, retail strucures and processes.