Amazon's Success Story

Who have not heard of Amazon, the company that shined after its market value exceeded the trillion-dollar barrier to become the second company in human history to achieve this value after Apple, which makes iPhones?

What is Amazon?

Amazon is an integrated website that provides shopping, payment, selling products, shipping, and storage services. It is a global electronic marketplace, and its clients are located worldly. They find all the products and goods they think of on Amazon pages and get them at the click of a button through their computer or mobile phone.

Who is the founder of Amazon?

Jeff Bezos, the founder of Amazon, has been the richest person in the world for the past three years. His wealth grew to $13 billion in one day, reaching $189 billion in 2020. Jeff Bezos grew up in a middle-income family in Houston, Texas. Jeff was known from a young age for his curiosity and vision for the future. He graduated in 1986 with honors in electrical engineering and computer science from Princeton University, then joined an investment company in New York. He quickly rose and was appointed the first vice president to be the youngest person to hold this position.

How did Amazon start?

It was the beginning of Amazon as a small online bookstore. Jeff Bezos understood the rapid growth of the Internet in 1993. He was fascinated by an idea that changed his life and the lives of everyone around him, which was selling books online. His idea was ignored at the time and considered a crazy idea, and Bezos had difficulty financing his project, which needed a budget of one million dollars. Bezos describes the reason for these difficulties as: "The poor understanding of investors and their lack of faith in the potential of the Internet, and their doubts about the ability of the Amazon project to succeed."

However, Bezos set out to implement the idea of his project, managed to secure his budget by obtaining $100,000 from his parents, and succeeded in convincing some businessmen to invest $50,000 per person.

In 1994, Jeff Bezos left his easy, well-paying job at a New York investment fund and went on to pursue his dream of establishing the world's largest online bookstore. He stepped out of his comfort zone and risked the idea, believing that success requires courage, risk-taking, and getting out of the safe area we spend our lives captive to.

Jeff Bezos launched his website to display products on the Internet, and it was limited to books only, for ease of transport, not being damaged, and not needing to be experimented on by clients. Then, Bezos moved to Seattle, Washington, which later became the headquarters of Amazon, and began working from his garage, with some assistants. Also, he began to develop the program for the site, and named his company Amazon, relative to the Amazon River, the largest rivers in the world, in line with his goal to become the owner of the largest store in the world. He sold his first book in July 1995.

The site was open 24 hours a day, was easy to use, and encouraged users to write reviews and recommendations for their own books, with the ability to search for books, which made Amazon a leader in e-commerce.

In 1998, Amazon began selling CDs and other video formats.

In 2000, an Amazon logo was placed in the shape of a smile-like arrow, extending from the letter (A) to the last letter (Z) in the Latin alphabet, indicating that the company provides all products from A to Z.

In 2005, Bezos found a need for diversification. Amazon went on to offer a wide range of products like electronics, clothing, and consumer products. Amazon entered the fashion world to compete with more than 70 brands of children's, men's, and women's clothing. Bezos launched a subscription program ‘Amazon Prime’ to ship products purchased from its online store within a short period, a maximum of 48 hours, a free service. Then Amazon diversified further, providing a cloud computing service, which was the largest cloud computing service in the world.

In late 2007, Amazon launched a portable reader called the Kindle, a digital book reader with wireless Internet access that allows clients to purchase, download, read, and store a massive book number.

In 2010, Amazon began producing its own TV shows and movies at Amazon Studios, and developed the service to allow online TV viewing.

Amazon's Objectives

We used to call Amazon the massive online retailer, according to JPMorgan Analytics. They note that Amazon's retail strategy led to a 41% year-on-year increase in total merchandise volume (GMV), rising to $316 billion in 2020, while Walmart's GMV index grew by only 10%, but to $439 billion.  If Amazon continues to outperform Walmart on this prime metric, it may not be long before it fills the gap.

Amazon's goals achieved a rapid rise in the 2021 fourth quarter, as profits and sales growth declined. However, Amazon's current CEO, Andy Jassy, attributes the decline primarily to a year of “extraordinary investments across our business to meet clients needs.” For example, investment bank Coin estimates that in 2020/2021, Amazon spent $80 billion in logistics investments alone.

Amazon is betting that these investments will help drive growth this year - no doubt, as it's increasingly clear over the years that Amazon's business strategy is more about clients service and removing barriers to creating a frictionless shopping experience. It's also about attracting people to the Amazon ecosystem and keeping them there - primarily by trying to make sure that individuals can find almost anything and everything they need or want in the Amazon world.

How Amazon works?

Amazon sells many things, and the direct sales approach from Amazon to the buyer is not different from what happens in most online retailers except for their product range. You can find cosmetics, clothing, jewelry, gourmet food, sporting goods, pet collections, books, CDs, DVDs, computers, furniture, toys, garden and bedding supplies, and almost anything else you might want to buy. What makes Amazon a giant is the details. Alongside its massive product range, Amazon is attempting to personalize the buyer experience.

When you get to the homepage, you'll find not only special offers and featured products, but if you've ever visited Amazon, you'll also find some recommendations only for you. Amazon knows you by name and is trying to be your own personal shopper.

What are the secrets to Amazon's success?

Everyone who reads the story of Amazon's success and rocket rise from humble beginnings wonders how it managed to do so and how an unknown bookstore turned into the largest online retailer to learn the secrets of this success:

1. Innovation Culture

Jeff Bezos believes in a culture of innovation and making the most of the innovative mindset. At Amazon, according to some internal sources, any employee who comes up with an idea offers it directly to officials, who transfer it directly to Bezos to study it immediately and start it if approved. Amazon allows all employees to put their ideas forward. It also communicates with the entrepreneurial community through the Amazon Launchpad platform, which helps startups sell their products through Amazon.

2. Risk-taking culture and acceptance of failure

Amazon accepts failure with open arms and learns from it, and has a culture of risk and exits the safety zone, for example, the experience of the e-reader "Kindle." Despite Amazon's lack of experience in the electronic device industry, and the advice of everyone not to take this step, Amazon insisted on its implementation, which changed the rules of the game and proved that Amazon employees could innovate.

3. Client Satisfaction Strategy

The secret to Amazon's success is to focus on “client satisfaction.” From the beginning until now, Bezos has focused on only one goal, which is the client. Amazon provides the largest possible range of products to the client in all appropriate and possible ways for them, and at the lowest prices, in addition to the free shipping service and the possibility of tracking the order by the clients themselves, which makes it outperform its competitors. As it is said: "Amazon has an infinite stock of everything that exists under the sun and at the lowest prices on the surface of the planet."

4. The Marketing strategy

The question remains: How does Amazon make these profits despite free shipping and low prices? It can make a lot of profit if it decides to collect the price of shipping, but it chose not to do so. Amazon's chief financial officer says it loses $600 million a year in lost revenue from shipping, and Bezos reduced the funding of "advertising" to replace the budget of "free shipping"; that is, paying money to satisfy the client instead of advertising and marketing to the company. People described this behavior as stupid and inexperienced, so how can Amazon continue and stay without “marketing?” The response from Bezos was as follows:

“If you build a great experience, clients will tell each other about it,” so Bezos was not wrong or stupid in diverting money from marketing to building a great client experience. He made his clients marketers for his company, and this movement was a milestone.

5. Great relationship with clients

Bezos provided a unique client service strategy that made Amazon an unparalleled purchasing experience. Unlike most companies where the client makes a call for support, Amazon is the one who asks clients to fill out a form stating their phone numbers and the numbers they want to call, and the call is often made to the client on the same day and sometimes even at the same hour.

Amazon representatives undergo extensive training to ensure that they can serve the client to the fullest extent. Every Amazon employee is forced to treat the phone as a man for two days - every two years, until Jeff Bezos is not exempt from this so that the employee does not lose thier focus on what is most important to Amazon, which is "the client."

An example of a story about Amazon's professionalism in serving its clients:

A man ordered a PlayStation device for his son from Amazon and wanted it to arrive early to be a Christmas present. When the time came to receive the gift, the client was surprised that his present did not arrive. So, he contacted Amazon's client service and explained to them. The client service representative checked the order status and turned out with them after the gathering of actions that one of the client's neighbors was the one who signed for the receipt of the order that he placed on the doorstep. Still, the gift was lost four days before Christmas. So, the client service representative rushed to send a replacement gift for the missing to arrive in time for Christmas, and exempted the client from the freight as well. This happy client went on to tell millions of his story with Amazon through an article in The New York Times, as he was a writer in this newspaper.

What services does Amazon offer?

Amazon offers a range of distinctive services:

1. Amazon FBA Product Selling Service

Amazon FBA allows selling products through Amazon. It is a very critical service for e-commerce because Amazon is the largest and most essential online shopping site in the world.

2. Amazon Global Shipping

This service provides the service of shipping products around the world at competitive prices with other shopping sites. There is a list showing the countries that Amazon ships to and customs taxes are assessed on the product, and Amazon carries out customs clearance on behalf of the buyer.

3. Today's Deal Service

It is one of the most important features of Amazon because it offers low-priced products significantly.

4. Amazon Payment Sending and Receiving Money

The service of sending and receiving money is similar to that of PayPal, and it allows the client to pay through any site (other than Amazon), which accepts payment through Amazon Payment, through the same regular client account that they use to shop at Amazon.

5. Amazon Cloud Drive

The cloud storage service allows the client 5 GB of free space, which they use to store photos and files, and they can also buy additional space.

6. Warehouse Deals Service

Warehouse Deals is an Amazon store that sells used electronic devices (in a new state), known in English as Like Now, at discounted prices up to 60% of the original price.

7. Gift Cards Service

Amazon gift cards are written when you pay for the product and are similar to recharge cards that are given by the account holder to friends or relatives who may not be able to buy from Amazon via the online account.

8. Amazon Associates

It is a program offered by Amazon to content makers. It allows them to market their products in channels of publishing written and visual content, and get a commission for each of their product purchases by a user.

9. Amazon Prime

Amazon Prime offers many advantages to clients who have a large volume of transactions with Amazon and who are classified as VIPs, such as:

Getting great offers and discounts on vouchers, and getting discounts on shipping fees and shipping service within two days, and later evolved to shipping on the same day and then shipping within two hours.

Steps to shopping on Amazon

To shop on Amazon, follow these steps:

• You register on the site and enter your data, your Mastercard or Visa Card number, your shipping address, and your phone number.
• Start the shopping process by entering the product name and searching for it.
• You start by searching among the available products, then choose the best product and the best price for you, and then put it in the basket.
• Here, before placing it in your cart, you should check other clients’ opinions and vendors' answers to their questions and watch videos about their experience with the product.
• Check all data before confirming the purchase, such as shipping address, shipment weight, shipping cost, product specifications, shipping time, and method, whether land, sea, or air.
• You then confirm the purchase.

Features of Amazon

Amazon has the following features:

• Amazon attracts your attention if the product is available at a cheaper price than other sellers, and the site also provides local links that sell the same product because the local product is cheaper.
• You can track the route of the shipment and where it is arriving.
• Upon receipt and trial, you may place your evaluation of the product on the Site.
• Amazon allows you to cancel an order after purchase in simple and uncomplicated steps.
• Amazon is a safe and reliable shopping site that allows you to return goods or receive appropriate compensation when the product you purchased through Amazon is lost or damaged, or if it does not meet the specifications.
• You can set up a wish list and type in the goods you want to buy in the future.
• Amazon offers the same product at multiple prices due to the large volume of sellers who offer it, and this is not available in the rest of the online shopping sites.
• Having an Amazon app that can be downloaded to mobile devices and used smoothly.

What can we learn from Jeff Bezos?

We learn from the story of Jeff Bezos lessons in entrepreneurship, such as:

• To be curious and consider what is happening around us in society, looking for new clients’ needs that no one has satisfied.
• Find our passion, what makes us happy, and work with it.
• Getting out of our comfort zone, believing in our ideas, taking risks, and not being afraid to fail because it doesn't mean it's a bad idea.
• Always strive for innovation and to be at the forefront.
• Not to stand at a specific limit, and constantly seek to diversify and develop our ideas and products.

In conclusion, Amazon (you order, Amazon delivers)

If we wanted to describe Amazon in one sentence, there would be no more appropriate sentence than that it "outdid itself." This ancient online store, which was the beginning of selling books online, has become today a place where you get everything you want, a click of a button and Amazon delivers to you what you asked for. Jeff Bezos revealed the inspiration for the company and the secret of its excellence in one of his interviews, saying:

“Amazon clients will remain loyal to us until another company comes along and provides them with better services.”