From 1 book to billions of products, Amazon’s 20-year journey into a lifestyle company
Chances are you’ll buy gifts from Amazon this year. And now it’s as easy as turning on a TV. A long time ago in a galaxy not very far away I wrote about Amazon.com’s upcoming IPO. It was the mid 1990s. The gist of the piece was that Amazon could become the Wal-Mart of the Web. And $1,000 invested in AMZN stock would be worth about $500,000 today.
A few years ago (2011) The Economist stole my headline in a piece with that title. But the real story is Amazon’s rise. Today it’s broader than Wal-Mart. Let’s take a ride…
Amazon’s founder, Jeff Bezos, spoke at one of my startup events back in the day and the overall impression was a no-nonsense guy with a plan to deliver great customer service. Those were the days Amazon just sold books. The key factors for success were there: breadth of selection, good price, fast delivery. I knew that with these elements Amazon could deliver anything way beyond books. The logistics of success.
Jeff’s former employer, D.E. Shaw manage about $40 billion and pioneered the use of computers in stock trading. I’ve spoken with David Shaw (its founder) a few times over the years and can say that David is one of those rare super geniuses. Bezos used to work at D.E Shaw before setting out for Seattle in his old Honda Accord to sell books online.
No wonder Wal-Mart wasn’t threatened. Take a look at Amazon.com Humble origins…a river ran through it:
Amazon’s had an interesting journey since then as books expanded into music, video, products, holding company for other retail sites, and this underlying technology aspect borne of Bezos’ own engineering and computer science background. A novel could be written about its expansion and growth.
A couple of big highlights: The tech know how led to Amazon’s Web Services crushing just about every other cloud computing company on the planet. AWS provides web services and hosting to thousands of companies large and small. Amazon Video is also an undervalued asset. It is at least as valuable as NetFlix.
Today, Amazon annual revenue surpasses more than $100 billion.
In a twist of irony after many offline bookstore chains have shuttered because of the Web threat, Amazon has opened physical bookstores…and what’s next looks like a chain of self-serve grocery stores. No cashier, no staff. You walk in and gather your goods and leave. Everything in your basket is tallied up and charged to your Amazon account automatically.
Amazon also has potential in many home-based commerce areas...I will leave it at that for now as I’m working on things that could tie into this.
In 1996 this future didn’t seem reachable. In 2016 it is.
In the larger picture I think we have 3 major lifestyle brands emerging that may become as common as wallpaper: 1) Amazon (Prime, Video, Echo Audio Assistant, Groceries, and more to come) 2) Google (Search, OK Google, Android, Chromecast, Google Play, and more to come) 3) Apple (iPhone, iPad, Mac, Apple TV, Siri, Maps, Cars, and more to come)
These 3 brands seemed best poised to me to become overall providers of home services, home commerce, home entertainment, home security, home information and related items.
How? Customer bases with credit cards in the hundreds of millions each. technology infrastructure surpassed by none. Expertise in the duality of tech and customer care. Global brand awareness.
Amazon swallowed the Web and these 3 are likely to swallow most of the world’s commerce, communication and content on a scale never before seen. Yet even with this, a lot of latent potential exists with them, held back only by the ability to imagine and execute. Only so many people know how to do this stuff and that is a real limiting factor.
They don’t teach the future in college, they teach the past. So it is up to the imagineers to do, make and explore. Ask Alexa. Wal Mart and Target didn’t think of that. And yes, in case you’re wondering, this URL has already been registered: Amazon.life
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