RAJAT GOEL

ROLL NUMBER- 371

MANAGING E-BUSINESS MID TERM

History, success criteria and future of Amazon

 HISTORY

Jeff Bezos left his job as a Vice President at a Wall Street firm- De Shaw and
Co- to start Amazon. According to his own words, he did this because he did
not want to have a regret later on that he didn’t participate in the internet
revolution that was taking place in the world around him.

Timeline of How Amazon progressed over the years:

1995- Jeff Bezos launches the company as an online bookstore

1997- Expands beyond books, launches an IPO at $18 share, acquires IMDB
1998- Amazon expand into Music CD’s and DVD’s
1999- Amazon expands into toys and secures a 1-click patent
2002- Files a lawsuit against Barnes and Noble, starts selling clothing
2003- Launches A9.com, launches AWS
2004- Enters China
2005- Launches Amazon Prime
2006- Launches Amazon Fresh in Seattle
2007- Kindle goes on sale
2008- Acquires audio books company Audible
2009- Kindle 2 goes on sale
2011- Launches Kindle fire
2012- Acquires robotics company Kiva Systems
2013- Makes plans for Drone delivery
2014- Unveils first smartphone, acquires game streaming service Twitch
2015- Echo becomes widely available
2017- Acquires Whole Foods
2018- Becomes the world’s biggest online retailer
2020- Jeff Bezos becomes the richest man on Earth
 CRITERIA FOR SUCCESS
Amazon.com is the world’s largest company by market cap and its founder and
CEO Jeff Bezos is the richest man on the planet. It was founded only 25 years
ago and is worth 5-6 times the GDP of countries which are more than a 1000-
year-old!

So, what exactly are the reasons that Amazon has succeeded so spectacularly?

1. Innovation- Amazon has created one of the most innovative companies

in the world. The products and services that have been pioneered by the
company have resulted in various me-too companies cropping up
around the globe but no-one does it better than Amazon. It has created
an incredible infrastructure which enables it to offer same day delivery
around the globe, it has created products like Echo which have
revolutionized the way consumers interact with technology and
continues to create new products with breakneck speed. It is safe to say
that Innovation is one of the foremost criteria for Amazon’s success.

2. Customer Service- Amazon’s customer service is renowned to be the

best there is. The company has created a hugely committed and skilled
customer service department which treats each customer complaint as
its topmost priority. Amazon realizes that only by ensuring repeat sales it
can hold on to the tag of being the largest company in the world and
therefore it gives this department the most attention than any other
department in the company.

3. Execution- Amazon’s execution is flawless. It gets everything right while

delivering customer’s orders and its error rate is better than six sigma. It
does not make any mistakes which is why customers blindly trust
Amazon to deliver the product they have ordered on the specified date
and in the right form. This is one of the ain reasons that it has been able
to stand against the competition and has not been replaced as the first
choice of consumers since the last 10-15 years.

4. Diversification- Amazon started as an online bookstore. It only delivered

books to its customers and that too in certain geographies. It then
started foraying in other product lines initially only as a third-party
seller, then it started launching its own private labels, it then forayed
into service like Amazon Prime OTT, Amazon Music and most crucially
 AWS. It has consistently tried to venture into new industries where it
sees growth and knows that it can build competency. That is the only
reason why it hasn’t gone the way of companies like Nokia or Kodak
which became complacent and refused to diversify from their
immensely successful products.

5. Outstanding User Experience- Amazon has an amazing UI/UX. This is

just a fact. It has always relied on a very strong user experience in order
to lure consumers and once they get reeled in, it is difficult for any other
company to poach them because of the outstanding experience that
Amazon offers. The company combines ease of navigation with an
amazing design to ensure that consumers get the best experience they
possibly can.

6. Merging Design with Content- Amazon knows that you need to build a
keyword rich copy in order to ensure that you win the SEO game.
Therefore, it builds in lengthy product descriptions and also ensures that
every product has a FAQ page so that it always stays at the top of the
SEO game. However, such lengthy descriptions can prove off-putting for
some customers which is why options like Add to Cart are highlighted
much more once the consumer has actually landed at the page.
Therefore, Amazon beautifully balances both design and content to
ensure that it attracts and converts the majority of the consumers.

7. “In It to Win It” Mindset- Amazon’s business model was such that it had
to burn a lot of cash before it started becoming profitable. Jeff Bezos
warned his investors that it would take a lot of time before the company
turned over any profit. However, that didn’t deter the company and it
continued burning cash for 8 years before seeing its first profit in 2003.
This is the same strategy that the company has employed in India where
it hasn’t registered a profit in 6 years but continues to invest billions of
dollars in the country because of the huge growth potential that the
conglomerate sees in the country. This In It to Win It mindset has proved
hugely beneficial to the company and has ensured that it continues to
reap the benefits of its employees hard work.
 FUTURE

Amazon has a lot of ideas for the future which can change the way people look
at this world:

1. Cashier Free stores: Amazon plans to introduce stores which enable

automatic checking out of products without the need for a physical
cashier. The amount would be automatically deducted from your
Amazon pay balance. There are already 26 such stores in US.
2. Fresh Food and Luxury goods: Amazon wants to cater to these two
segments which have huge margins. The company’s acquisition of Whole
Foods in 2017 was done so that the company can tap into the fast-
growing grocery segment. Amazon also aims to cater to luxury shoppers
and has started collaborating with luxury brands to cater to such
shoppers on its platform.
3. India: India seems to be on the top of CEO Jeff Bezos’s mind. The
company is very keen to have a mega presence in the country which is
why it is fighting tooth and nail with Walmart and Reliance to decide
who will be the retail king of the country.
4. Food delivery service: The company sees huge potential in the food
delivery segment and has already trialled a food delivery in its home
market and in the Indian Silicon Valley city of Bangalore.
5. Home Robots: In April 2018, Bloomberg revealed that Amazon is
working on a project that could really shake things up: a next-generation
smart robot for the home that will be powered by artificial intelligence
(AI). Named Vesta, after the Roman goddess of home and family, this
robot (not pictured) will help around the house with cleaning and other
chores, making everyday home life just that little bit easier.
6. Luna: Another industry the tech giant is keen to make waves in is
gaming. Amazon has just launched Luna, a cloud gaming service that
allows users to play on streaming devices without having to download or
install games beforehand. Luna will work on any Bluetooth controller,
but Amazon has also released its own Luna version (pictured), which will
connect directly to the cloud service. The games players can access
depends on which channels they subscribe to, with the base channel
Luna Plus costing $5.99 a month for early access users. There is no fixed
 release date for Luna, but keen gamers can already sign up for early
access. 
7. Healthcare: Amazon has been supplying hospitals for years now, but it
intends to take the medical side of its business to the next level. Amazon
Care launched in September 2019 as a pilot for Seattle-based Amazon
employees and their families. So far it has proven successful enough that
Amazon is starting to scale up the service to cater for more workers. The
service provides virtual and real-life healthcare assistance through Oasis
Medical, including in-app visits to a doctor, in-person check-ups and
prescriptions delivered within two hours.
8. Self-driving technology -While Amazon hasn't revealed any plans to
incorporate driverless technology into its future delivery vehicles, the
company's investments suggest that might be the plan. In June this year,
Amazon announced it was acquiring autonomous vehicle company Zoox,
which has been developing driverless cars since 2014, for $1.3 billion
(£998m). Zoox is known for building its vehicles from scratch, rather
than from traditional cars, and it plans a vehicle that can drive
backwards and forwards without turning. This isn't Amazon's first
venture into driverless tech, as the company has previously invested in
companies such as self-driving car start-up Aurora in 2019, and
driverless trucks by Embark were spotted carrying Amazon wares on the
I-10 Interstate highway in the US in January 2019. Things may move fast
for its latest acquisition, as Zoox was granted a permit to test driverless
cars without a back-up driver in California this September. 

References:

1. www.forbes.com
2. www.cnbc.com
3. www.snapagency.com
4. www.officetimeline.com
5. www.hardwareretailing.com