Amazon.com - The Success and Reasons

Starting a business is easy, as long as there are enough modals and resources. But, maintaining a business and making it into a success is the hardest part in the business life cycle. This concept is even harder to fulfill in the electronic business world – E-commerce.

“Some business models may appear logical on paper, but it may not work online,” quoted Blooming.com.my’s managing director, Martin Cheah.

An example of a successful E-commerce website I would like to discuss is Amazon.com. Amazon.com, inc. a Fortune 500 e-commerce company is based in Seattle, WA. The company was founded by Jeff Bezos in 1994. Since it first kick start online in the year 1995, Jeff Bezos and his handful of employees spent late summer nights packing books in a tiny warehouse, scrambling to ship a growing gush of orders. They started out as an online bookstore and then diversified by adding other items, such as VHS tapes, DVDs, Music CDs, Software, video games, electronics, MP3s, clothing, furniture, toys and even food items.

Amazon has nearly 49 million active customers. With $6.92 billion in sales in 2004, Amazon ranked at the top of Internet Retailer's annual top 400 list, well ahead of computer maker Dell Inc., which posted $3.25 billion in online business-to-consumer sales. Office Depot Inc., which has a partnership with Amazon, was not far behind with $3.1 billion. The company remains profitable with $8.5 billion in 2005 and $10.7 billion in 2006. On January 15, 2009, a survey published by Verdict Research found that Amazon was the UK's favorite music and video retailer, and came third in overall retail rankings.

Reasons of Success
The main reason for Amazon.com success is because of its focus on customer’s experience. This factor is infused in all levels throughout the company. Amazon’s emphasis on customer’s experience as a team’s responsible, not a person’s responsible. Customer’s experience is a combination of listening really hard to the customers and innovating on their behalf. They will make adjustments to their services to make their customers more confident and comfortable with buying online. Amazon.com has a Web metrics group that is responsible to measure sales metrics and monitor them in various increments of time – by the minute, by the day, or longer. The interview with
Maryam Mohit from Amazon.com tells us more.

Besides that, motivation is also a very important factor that gave a minority contribution to the success of Amazon.com today. When Amazon was struggling to make profits for the first time, only its founder Jeff Bezos believed that the business goal could be achieved in a year's time. Everybody was astounded when Jeff Bezos
achieved his goal after one year.

Amazon changed the way it operates its business throughout the years. First, it was an online book seller. Then, it expanded into selling other items which its customers are demanding for. Amazon has constantly evolving its product lines, which makes its competitors having a hard time catching up. When the Internet's stock market bubble burst, Amazon re-structured.

More on the reasons of its success, Jeff Bezos took the opportunity to embrace the technology. When the company went public in 1997, skeptics wondered if an Internet-based start-up bookseller could maintain its position once traditional retail heavyweights like Barnes and Noble or Borders entered the Internet picture. The skeptics see Amazon’s rapid growth move as a doom factor, but a few analysts sees it as “one of the smartest strategies in business history”.


For more details, these are some useful links which will explain further on the survival of Amazon.com, Inc. throughout the years:

>>
How Amazon.com survived, thrived and turned a profit

>> Amazon: E-Commerce Success Story

>> Inside the Mind of Jeff Bezos




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