Amazon.com – Get Big Fast is one of the five books of the Bookcase “Development Strategies” - Secrets of success of global economic groups - necessary knowledge for every business manager today.
With a narrative style of presentation, Robert Spector guides the reader through each period in the history of Amazon.com. From the experience of financial science to the formation and development of the world's leading website selling goods. Amazon.com fans are treated to a portrait of Jeff Bezos, a science geek who loves to explore and dreams of intense personal expression. From working style, talking to people, to classic M&A deals; All have put Jeff Bezos' name on par with the world's leading billionaires in the technology world such as Bill Gates, Michael Dell...
There is a line on the cover of this book: “The last chapter is the one left open to tell the story.” Almost every day people report about the company. By the time you read this summary, the story is only partially updated. Writing about the history of a contemporary business company is like that.
Who should read this book:
- Anyone who intends to start a technology and especially e-commerce business
- Anyone interested in e-commerce and how to develop e-commerce
- Anyone interested in business technology in general and tech startups in particular
About the author
Robert Spector is a respected business speaker and consultant on the Wall Street Journal, USA Today, Nasdaq. Co-author of Best seller “The Road”.
The beginnings of family stories
Jeff Bezos comes from a laid-back and easygoing family. Even after learning that his current father is not his biological father, Jeff still claims to consider him as a natural father. He lives happily in the love of his family with two half-brothers. He inherited from his mother high energy and dedication, qualities that were evident from his high school years. Besides, grandfather is also someone Jeff respects very much and influences Jeff in a positive way. He was an interesting and very intelligent man who encouraged and supported his nephew's passion for science. Jeff's garage is always full of strange things, with projects whose complexity grows far beyond his age.
Jeff cherishes many big dreams and ambitions. His friend once wrote of him: "Friendly yet serious and courteous, Jeff possesses an overall intellectual excellence."
After graduating from Princeton University with a bachelor of science and engineering degree in electronics and computers, Jeff entered life filled with confidence and a desire to fulfill his dreams.
The idea of selling books was conceived
The job advertisement of Fitel company - a financial telecommunications company based in Manhattan reads: "Recruiting for the best graduate from Princeton University in computer science". In 1986, Jeff became an employee of Fitel, overseeing the international telecommunications network. In 1987, he was promoted to deputy general director of the company. In 1988, he moved to Bankers Trust and a few months later he became the company's vice president.
Two years later, Jeff left the financial services business, and it was at that point DE Shaw & Co caught his attention. He appreciates Shaw, an intelligent yet humble man who shares similarities in personality and intellect with Jeff. Despite the fact that DE Shaw's selection is very strict, in October 1990, Bezos still successfully applied for the company, holding the position of vice president in charge of research and development of network business opportunities. The research Jeff did for Shaw revealed a surprising fact: Web usage is growing rapidly Trat at a rate of 2300%/year thanks to the presence of the Mosaic browser for Mac personal computer users. or Windows.
Through research, he also found books to be the easiest product to sell on the web. The reason given is: everyone knows what a book is, an online bookstore can order an unlimited number of products, customers can easily learn about titles to make a purchasing decision, with a simple process. much more economical operation.
So, Jeff suggested to Shaw to launch his first online business model with the Book Sale Project. Contrary to his predictions, the idea was not appreciated by Shaw and Shaw rejected the project. At that time, Jeff thought: "Starting my own company specializing in selling books on the internet, if I try, even if I fail, I will not regret it".
Amazon was born
Jeff sets out the criteria for choosing a new business location: an area with a lot of tech talent. In the end, he chose to set up his headquarters in Seattle. The reason he gave was: Seattle is a mecca for programmers, the cradle of the University of Washington, life here is bustling and this is where Ingram Book Group locates America's largest distribution center.
Jeff wanted his company name to start with the first letter, so the name Amazon.com was born. Interestingly, he never called the company Amazon for short, he always called it Amazon.com. Jeff persuaded Kaphan, a well-known person in the tech world in Silicon Valley to join him on this project and invited Barton Davis, a good programmer to work.
Before he could revolutionize the book business model, Bezos had to learn how to sell books first. He attended a four-day course sponsored by the Book Publishers Association of America. In the class, 40 students took turns speaking and discussing ideas. "I'm going to open an internet bookstore," said Bezos. The whole room was silent at that time with the thought "Wow, a computer madman" but Bezos thought "the Amazon platform will give customers the best online shopping experience and need to build Amazon.com become the most customer-focused company in the world.”
Initial steps of operation
In October 1994, Jeff Bezos, Kaphan and David started building the company from arranging the company headquarters in a garage created. The room is only 1.5 car long but contains all the computers, file cabinets, bookshelves and a round table. In that tiny garage is also the fourth member of the company, Mackenzie Bezos - Jeff's wife. They got married in 1993 and now she holds many positions in the company, including accountant. Bezos estimates that 85% of the platform development plan for Amazon.com is focused on supply and shipping systems. At first, almost the entire system was written in the open source software program “e”, powered by Perl – the most loved machine language of the time.
By the end of 1994, there were 10 times more email users than web surfers. Bazos, Kaphan, and David struggled to find the right balance between providing customers with a catalog of products via email and tightly managing the business on the web.
Selling books on the internet is possible because the database is available in a CD ROM (updated periodically) issued by the US book industry. When Amazon.com products hit the web, customers began demanding information on how and when to deliver their books. Kaphan and David are now dealing with a programming request related to Amazon.com's warehouse back-end management system that requires credit card security.
Tim O'Reilly, a book publisher, praises Amazon.com for building an easy-to-use interface with a focus on functionality. Amazon has entered a pivotal period.
The first bright spot of development
When Amazon swelled to 5 people, the electrical capacity became overwhelmed, the company moved into the house on Algebra 1 in the Seattle industrial park. For a visionary high-tech company, this position is not very popular. With the web infrastructure in place, several key developments transformed the web from static online into a user-friendly means of interaction. The company hires experienced book editors to be responsible for the "target", each with a theme and a new change every day. Amazon.com exploits the ability to search by author, title, subject, and publication date so that customers can easily find their favorite titles.
Yahoo! really liked the Amazon.com website, and they offered to put it in the “Interesting Things” section on Yahoo!, which if another company had offered to Yahoo! similarly, they will have to pay a fee of 10 million dollars. Amazon quickly became a famous and popular e-commerce website. With more than 1.5 million book titles, 1 million transactions, Amazon.com ships to all 50 US states and 45 countries around the world. From 100 orders a day to 100 an hour, Bezos says: “Our wealth disappears when we don't serve our customers well. So spend your money on things that impact customers.”
Money is no longer a worry
Amazon.com consistently delivers modest sales. From the day it was founded to 1995, the company lost 303,000 USD, making Jeff "crippled". Despite running out of his own funds, he remains steadfast in his path and believes that Amazon.com can feed it on its own.
Convincing Seattle-area investors to write checks ranging from $20,000 to $100,000 isn't easy. Hanauer arranged for Jeff to meet with investors he knew such as Dillon, Tom Alberg, Raghavendran… Bezos said: “The most difficult thing is that customers do not adapt to the new habit of buying books online. But the first people to use computers, to use cell phones, they were the first to do everything, they easily learned new habits.” Investors were convinced by Bezos.
Then, on the front page of the Wall Street Journal, an article appeared: "How Wall Street Professionals Found the Ideal Internet Bookseller". The article is an unprecedented blow to Amazon.com commerce. Phones poured in to the company from venture capitalists who wanted to get into the business. Unexpectedly, Amazon.com became the hottest girl in the prom. Amazon.com thinks big: “We never have to worry about money again. That sky is the limit. We will build a strong, sustainable and dominant company in the market.”
Opponent recognizes face
With venture capital in his pocket, Bezos began his quest for rapid growth by hunting down managers, directors, and employees. The challenge now is to build a great team. The main condition to be hired by Amazon.com is a self-sacrificing desire for the intense fighting spirit, for a culture of reciprocity for newcomers, the ability to work cooperatively, friendliness, and effort. move forward and never be satisfied with where you are.
Due to the arrival of new employees and managers, the space of the house on 1st Avenue became cramped, management moved to the Columbia Building on 2nd Avenue while the distribution department moved to 31,000-wide Dawson Street. m2
Under the intense attraction of Amazon.com, Barnex & Noble and Borders both began to wake up and pay attention to this competitor. "You're doing a great job, but of course we're going to kill you when we launch the site," the Barnes & Noble president told Bezos. However, we would still like to discuss it with you.” Selling books online suddenly became huge. Competition will be fierce, not only between Amazon.com and Barnes & Noble, but also among other savvy independent booksellers. To survive, an online business cannot rely solely on catalog and price.
Customers – the key to survival
Jeff Bezos often says he wants to make Amazon.com a "customer-centric" company. Making customer service his number one priority for the company, as he knows positive word of mouth has a greater impact on customer perception than any form of paid advertising. Bezos understands that there is always someone willing to "burn" a company through the world's media. When the company is in a stalemate, there will be enough loyal customers to come to the rescue.
We are always obsessed with the customer, not the competition. The Internet is a fierce sea storm, the only thing that is constant in that storm is the customer. Amazon.com's lifeline is to bring something on the internet that can't be done any other way. What drives people to shop online is that it's easy, fast, and economical. Customers are invited to participate in writing reviews that create a sense of “community”, the interactive philosophy of the reviews is to “attack ideas, not people”.
Good customer service is about keeping promises to customers. Now Amazon's service is growing at a rate that the competition can't match. If you find it difficult to grow fast then this is hardly the place for you.
By the end of 1996, Amazon.com had 151 employees, sales of 16 million USD, although it is nothing compared to the 26 billion USD of the domestic book industry, but it also shows that online business is becoming a big business. trend cannot be ignored. According to the survey, this time there were nearly 35 million web users, of which the number of people with university degrees accounted for over 62%. Amazon.com has worked hard to appeal to this particularly quintessential and dynamic audience.
Around that time, many major publishers and distributors were preparing to launch their websites, which meant that it was time for Amazon.com to face competition, especially Barnes & Noble. Three days before Amazon.com went public, B&N sued Amazon.com in Manhattan federal court over false claims: "World's Largest Bookstore," "Over a Million Titles," that actually didn't exist. Nothing. Ask Amazon.com to stop advertising and make a "correction". Amazon.com then filed a lawsuit against B&N in New York federal court claiming that B&N competed unfairly. The following month, the two sides settled to withdraw from the litigation. Amazon's plan in the IPO market is still successful.
Ideas for the far-sighted
Two key things Jeff often emphasizes are recruiting and press relations; he put his energy into it to make Amazon.com the most worthy icon for e-commerce. Amazon.com is the transformation of vision, intelligence, technology, money, and timing.
In 1996, when Bezos took the entire Amazon.com staff on a vacation to Washington, the vacation was about strategy that went beyond books; They talk about DVDs, CDs, Videos, music and movies. The long-term vision is that people come to Amazon.com and find whatever product they want to buy. Amazon.com is testing the "Shop for web" service and is moving towards becoming the world's e-commerce portal. Amazon has proven to everyone the size of the internet as an economic phenomenon. But all that Jeff Bezos got there was just the beginning. Bezos just got in.
Acquisitions and mergers
If “grow fast” was Amazon.com's first three-and-a-half-year mantra, the mantra for 1999 and 2000 was "rapid growth".
The first major move came in February, when the company bought 46% ownership of Drugstore.com. Amazon.com added an easy link to the website to Drugstore.com. In March, Amazon.com opened an auction site to challenge eBay. Amazon.com's auction approach is aimed at helping people find most of what they want. To launch, Amazon.com held a donation auction for the World Wildlife Fund. Also this month, Amazon.com bought 50% of Pets.com, which sells rare accessories and animal feed. By June, Amazon.com invested $450 million and art auction house Sotheby's Holdings; then spent 200 million USD to buy e-Niche, trading through Exchange.com specializing in precious antiques and excellent books. At the same time. Amazon.com also bought two more companies, Accept.com and Alexa Internet Co.
The tactic that Bezos learned from Microsoft was to buy what he couldn't build. At this point, users who log into Amazon.com's "Welcome" page no longer see an online bookstore but rather an online store that sells books, music, videos, e-cards, auction items, toys, and merchandise. Electronic consumer…
All those acquisitions and mergers, made the Amazon.com brand so powerful. The Times magazine said of Bezos: "Unquestionably, he is the king of the cybernetic commerce and the individual who helped build the foundation of our future."
The road is long and the ending is open
Jeff Bezos is building a company that - as he puts it - doesn't value profit in an attempt to change the world. Amazon.com has a creed of its own. When it was still in the “fast-growing” model, the company spent money anytime, anywhere that leaders felt it was worth spending. Working without a rigid budget, the employees are constantly afraid to spend $50 to ensure that the $25 item gets to the consumer on time. The negative aspect is that on the books the company carries a debt of nearly 2 billion. In mid-2001, international operations looked disastrously unprofitable. Amazon.com's core business of books, music and video slowed down; Business-to-consumer cost levels on the web increased comprehensively.
But let's look at the bright side, Amazon.com offers the best shopping experience on the web with a great catalog, convenience, ease of use. Customer service cannot be faulted. Many of its competitors were buried deep in the dot com graveyard. Amazon needs to figure out how to better control costs (delivery costs make up 14 to 16% of revenue).
After researching and following this company for three years straight, I have a feeling Amazon.com will continue to exist in some form, but not the form we see today. And, Jeffrey Preston Bezos will forever be remembered as the brilliant vain man who, despite his flaws, made his dream come true. This is a wonderful story.