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The Mighty Amazon: Bezos Books his Ticket for Success
The Mighty Amazon: Bezos Books his Ticket for Success
“I’m going to do this crazy thing,” Bezos told his boss on Wall Street one day. “I’m going to start this company selling books online.” It was the spring of 1994 and the Internet was growing at 2,300 percent a year. Bezos knew things just didn’t grow that fast. “It’s highly unlikely,” he says, “and that started me thinking, ‘What kind of business plan might make sense in that context of growth?’”
Bezos immediately began looking into the top 20 mail order businesses to try and find the one that could be conducted more efficiently over the Internet. Finding no comprehensive mail order catalogue for books – it would be too big to mail – Bezos decided this would be the perfect product to sell over the Internet.
The very next day, Bezos flew to the American Booksellers’ Convention in Los Angeles to better understand the industry. There he discovered that electronic lists of inventory for the major wholesalers already existed; Bezos would just have to create a single place on the Internet where consumers could go to search for and order the books they wanted.
Armed with renewed drive, Bezos returned to New York, where with the support of his wife and the financial backing of his parents – they had given them their life savings of $300,000 – he quit his comfy job and committed himself to starting his own company. The two booked a flight to Texas, picked up a 1988 Chevy Blazer from Bezos’ stepfather, and began making the drive to Seattle; Bezos had deemed this the appropriate city for his venture since it allowed him both access to the book wholesaler Ingram as well as to people with the computer skills he would need. It was on the drive over, with his wife at the wheel that Bezos wrote the business plan for Amazon.com; he chose the name after the powerful and continuous South American river, and because at the time Yahoo! listed its search results in alphabetical order.
When the couple arrived in Seattle, Bezos immediately went to work in the garage of their new two-bedroom house. He wrote the code for a test site and asked 300 of his family and friends to test it; the site worked. On July 16, 1995, Bezos made his site public and told his friends to spread the word. Despite not spending any money on advertising, Amazon was selling books in not only all 50 states, but in over 45 other countries within its first 30 days. After two months, the company was earning sales of $20,000 a week; Bezos’ parents were fast on their way to becoming billionaires.
Critics doubted, however, whether this kind of growth could be sustained, especially when Amazon went public in 1997 and through the dot.com bust. Nevertheless, Bezos continued his quest to increase Amazon’s market share. By introducing such novel features as customer reviews, email order verification, and one-click shopping, Amazon had achieved a market share larger than its two biggest competitors combined in just two years.
Over the years, Amazon expanded its product line to include everything from clothes to toys, forming partnerships with the likes of The Gap, Nordstrom, Borders, and Toys ‘R Us. With its over 12,000 employees and $8.8 billion in sales, Amazon has become both a leader in e-commerce and a household name. Today, Bezos has expanded his vision of creating “Earth’s biggest bookstore” to “Earth’s biggest anything store,” and he is well on his way to achieving that goal.
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Jeff Bezos Video - The dot-com boom-and-bust is often compared to the 1849 Gold Rush, and Amazon.com founder Jeff Bezos offers historical evidence showing how similar they were: from the riches made by pioneers to the media hype that attracted luckless speculators. But a better analogy can be found in the early days of the electric industry, he says. In the late 1800s, the U.S. was first wired to support lightbulbs; the following century saw a long procession of new appliances, life-changing advances, and of course some amusing failures.
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“Every well-intentioned, high-judgment person we asked told us not to do it,” Bezos recalls of his early goal to create Amazon.com and offer one million, many hard to find book titles online. Some people said he sho...
