When Amazon started in 1995, it was a site that only sold books. Within a month of its inception, the company had already shipped books to over 40 different countries. Those who are accustomed to today’s Internet may not realize the impact Amazon had at the time. Since that day, Amazon has continued to grow into one of the world’s largest online company. So what makes Amazon so great? Consider these 7 reasons why Amazon rocks.
1) MANAGEMENT
Amazon’s success stems from CEO Jeff Bezos and his management team, who operates differently than most other companies. Bezos can even be described as chaotic or frenzied. Employees are encouraged to let out primal screams. A $40,000 ice age cave bear skeleton stands in the office – the result of Jeff’s failed attempt to compete head-to-head with eBay’s entry into online commerce. Despite his sarcastic outbursts, Bezos is one smart cookie. He knows what works and isn’t afraid to take chances. Consider their year-old, off-kilter voice command device, Echo. Address an Echo device to hear songs, find out sports scores or even the weather. This handy little device surprised economists – according to 1010 Data: “The Echo has over 30,000 reviews, averaging 4.5 stars. Compare this to the Sonos Play:1, which is competitively priced with the Echo and also has 4.5 stars. It has 2,000 reviews. In 2015, Amazon accounted for 25.9% of all speaker sales online.”
2) INNOVATION
Amazon wasn’t the first online company, but it is one of the most innovative. Sure, other companies have made billions selling online. Amazon’s success started with one meager product category: books. But it didn’t stay that way. Jeff Bezos had the idea that Amazon would become “the everything store”, and it did. The introduction of the Kindle didn’t beat other e-readers to market, but Amazon’s became the most popular. Business Insider reports several new innovative products and services coming from the company. One service is called Amazon Locker – a secure service for New Yorkers, Londoners, and Seattleites. Locker is for people who don’t want packages shipped to work and who can’t get to the post office before it closes. Or how about Amazon Flow? This cool app lets you snap pictures of products and have them automatically added to an Amazon shopping list. Staying connected to what consumers want is what makes Amazon great.
Are you considering selling your products through Amazon? Read our guide: Is Amazon Right For Your Products?
3) CUSTOMER SERVICE
Amazon consistently ranks high on customer satisfaction lists. Why? Bezos told US News that customers have to be treated special. He believes that a company shouldn’t focus on its competitors but rather on its customers. His most important lesson in service comes from the term “word of mouth.” In an interview in Wired magazine, Bezos stresses how important word of mouth is – in the physical world an unhappy customer might tell six people, but online that same customer could reach 6,000.
Most likely, Amazon’s most critical success factor is the customer service strategy. The company consistently ranks high on all satisfaction lists. After all, most of the products they sell can be found almost anywhere on the net. There are online bookstores, music stores and clothing stores. You can even find full-service online grocery stores.
What makes Amazon so special? According to the Temkin Experience Rating respondents, Amazon ranks well above other retailers in service and customer satisfaction. In fact, the company is tied for first with PetSmart for retail top honors, and fourth overall out of 293 for companies in 20 different industries. In other words, there are no other retailers that do it better than Amazon. But what truly makes it rock is that it’s better in service than companies that aren’t even retailers. Kind of like beating everybody else at their own game.
4) EXECUTION
Despite early growing pains, Amazon has gotten things right when executing customer orders. They select products and services that customers want and need. They have distribution centers across the globe that allow them to quickly ship products. And they have excellent vendor relationships that allow them to offer customers discounted pricing. The world’s largest online retailer is also ramping up plans to invest more across Europe this year, employing thousands of more employees. Additionally, they’re searching to implement brick-and-mortar stores that will have the capability of same-day-delivery… by (hopefully) drone nonetheless! They just opened their first physical store in New York City in March
5) DIVERSIFICATION
Starting off as an online bookstore, Amazon now offers everything from soup to nuts. Literally. A search of the site reveals over 3,000 listings for vegetable soup. Search the term “nuts” and you will see over 37,000 results. The company now carries products in music, books, electronics, health and beauty, automotive, grocery, and clothing. Business owners can contract with Amazon’s network of pros to get IT support, furniture assembly, and A/V services. Much of Amazon’s success hinges on the fact that they’re not afraid to sell anything and everything. Take a look at the Superbowl commercial they put on this year. Interested in a tiny horse? Amazon just may be able to ship it out today (and if you’re a Prime member, you’ll get you’re new four-legged friend in just two days!)
6) THE FEAR FACTOR (OR LACK THEREOF)
Bezos started Amazon at a time when the success of the net was uncertain. He was a successful VP at an investment firm, but he dumped that role to start his own company. That lack of fear is what drove him to consistently claw his way to the top of the internet food chain. Bezos told Time Magazine this is called “regret minimization framework”. No matter what he calls it, Amazon is great because it has benefited from Bezos’ non fear factor. Watch him explain regret minimization framework and how he dreamed it up in the video below:
7) IN IT TO WIN IT MINDSET
Does anybody really remember when Amazon was unprofitable? If you’ve been around for awhile, you might remember Bezos’ warning to investors that it would be a long time before they would see a return. Back in 1997, he told Inc. Magazine that Amazon would be unprofitable for a very long time. His “in it to win it” mindset kept the company pushing through new strategies until 2003 when the company posted its first profit.
Much like Apple and founder Steve Jobs, Amazon success factors are closely tied to Jeff Bezos. His innovation and desire to keep moving forward has pushed the company further than early critics believed possible. No matter how you look at it, Amazon has grown up from a little online bookstore to an industry giant. You could even say Amazon created the industry for total domination.
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