10 Companies that wow us - Part III (Amazon)
OK, we’ve already covered my
#10 pick (Logitech) &
#9 pick (Yahoo!) and most everyone agreed with my analysis. So now I’ll progress on to my #8 pick as I move up the list. In each series I’ll list the good, the bad, and the ugly (if applicable) of each – including annotations on what they both do best and worst. Who has the best chance to move higher up the latter? Who is in danger of failing with consumers? Who has burst onto the scene like a bat out of you know where? Let’s take a look.
#8. Amazon.com - Amazon.com is probably one of the most respected e-Commerce websites in existence today. One of the major survivors of the dot-com bubble burst in the late 1990’s, Amazon is a veteran of the internet, tracing its origins back to 1994. It took nine years for Amazon to make its first annual profit, but today is a multi-billion dollar company renown worldwide. So why has Amazon made my list, coming in at #8?
Amazon is built, from the ground up, very respectably. What was once merely the world largest bookstore is now a website offering most anything the mind can desire. You may not even know it, but Amazon was originally called Cadabra.com (as in, Abracadabra – catchy huh?). The name was changed later, as the founder felt it sounded too much like the word cadaver (a deceased human body). Good idea on that one.
Amazon has always been different from the start. It was one of the first e-Commerce sites to plan on profits 4-5 years after starting; a strategy that alienated the company from investors and ultimately almost lead to its demise. But in the end, the strategy worked out, and it has changed how many online businesses view their own business plans. While many companies grew wildly and ultimately recklessly to success in the 1990’s, Amazon took a steady approach and eventually persevered even after the bubble-burst.
But beyond what Amazon is built on we need to look at what makes the company a top choice in my list. Amazon makes my list, if for no other reason, because they make it so darn easy to find what you want. A curse (financially) or a blessing, you can very easily find what you’re looking for at Amazon’s website. In fact, you might even find something you weren’t looking for. Amazon was one of the first retailers to introduce the ingenious plan of targeted marketing. The site recorded your movements - what you looked at, purchased, or put on your ‘want list’ - and ultimately started delivering content to you that it believed you’d be interested in. If you purchased the DVD of “X-Men 3” then Amazon just assumed you’d be interested in the DVD of “Spiderman” and “Superman Returns.” Chances are, it’d be right from time to time and the business strategy is quite brilliant. Since its introduction, the trend has spread over the web like wildfire. Google’s also been known to use this approach, with a lot of success.
OK, so Amazon has all the means to get you exactly what you knew you wanted (and maybe some of what you didn’t know you wanted). Great! But to make it on my list, Amazon had to go beyond that – and they do.
First, the reviews on Amazon are a real litmus test of the product you’re buying. The different between a great product and one that sucks is usually pretty clear by reading over a few accurate reviews (accurate being the key word). And no one on the web has quite as many reviews as Amazon. While there have been some problems with this process in the past (I’ll touch on that below), lately everything’s been smooth & more importantly, respectable, for the reviewing process.
Second, Amazon has perhaps the best return policy on the planet. If you order something and decide when you receive it, that it’s not what you wanted – just send it back. Amazon even includes the return label right in the package, and they’ll even pay for shipping. How cool is that?
Last, Amazon has produced a number of innovative ideas and technologies through its website that are sure to impress. Chances are you’ll never use them all, but even if you use just a few – you’ll see what I mean. The idea of a “Wish list” and “Gift registry” has been redefined using the Amazon model. Now the whole world can shop for you without having to worry about what stores are local to a certain area and what place has what product. Plus, at Amazon you can almost always guarantee it’s in stock. ‘Santa’ especially loves it for those hard to find items that local stores don’t always carry. I mean, where else could you get a Segway Human Transporter? Only on Amazon.
OK, it’s not all good though. The real negative with Amazon is ironically the very thing that some consider their modern strength. The slow growth of the company continues to keep investors weary, and many have quickly forgotten in a new Web 2.0 world what happened just a few years ago. The firm has remained profitable since 2002, when it made its’ first quarterly profit (first annual profit in $2004). Unfortunately the firm's cumulative profits have remained negative (US$2.03 billion in 2005). The positive performance of recent years has just not been enough to wipe out the deficits of the past.
The ugly is the companies approach to support on its website. In general, the site could use a major upgrade to its support area. This has been a huge problem for the company for years, and it perhaps the only real negative to most consumers. The company also once had a bad problem with fake reviewers flooding good or negative comments about various products. Amazon has since remedied that problem by forcing users to log in and provide authentication.
In conclusion, Amazon is my absolute favorite retailer in the world. I love that I can find what I’m looking for, without having to walk a dozen isles and that despite shipping charges, hey, at least there’s no sales tax. Plus, with services like Amazon Prime, I can have my items here overnight for just $3.99. Pretty sweet deal when you want something in a hurry and don’t want to wait. And I love their return policy; I really just cannot say enough about it. If Amazon could get their support center in order, they’d be a real gem all around. Consider me a fan, and I think if you give them a try, you will become one too. If you can’t find it on Amazon, well, it’s probably not worth finding.
Next week I’ll introduce my number seven pick…
John C. Derrick
Founder
