In 1995 when Amazon flung upon itself to virtual world, Amazon took off at a light speed with no turning back ever. Enchanted by mammoth selection of books, a friendly UI, internet broke with mailing lists and conflagration spread across the seattle.
With almost 20 potential products list in hand that comprised of software, CD’s, electronics, Bezos chose books over everything and that kinda hit the last nail in coffin.
Why on the earth Books?
Well as much as Bezos loved reading, he didn’t start out of his love for reading. It was a well thought and extremely well crafted idea that was going to change the online purchase dynamics forever.
It was the blend of both Bezos intellect and his timeline of business that he started with books with a vision much bigger and brighter.
Admit it, Books are one hell of an easy product to ship, a tough to break and requires no instant initial hefty investment. They have very minimum possibility of returns , and so less risk of shipping and returns. Unlike apparel Customers satisfaction lies in quality of books, just the quality and not the cognitive aspect.
Also, let’s not forget, publishing houses were already facing major crisis when Amazon went up. So, selling books at dirt cheap was one hell of a way to access customer’s name and data that would later change the way we consume stuff online. Books earned Bezos loyal and returning customers. Once he had them, he knew it won’t be of a task to sell into CDs and DVDS.
With enormous selections of books, the customer service reached a new heights and it became more of community than just a platform to sell/ buy books. Amazon engaged its customer with reviews, ratings and what not.
Publishers were forced to offer quality of work and though amazon literally sold books for loss, it didn’t matter as it made people read and talk. Hence customer hooked onto it. After establishing brand loyalty and trust, Amazon moved to other segments as well and the rest is history
Sales: $610 Billion; Profits: $0
One of the most astounding things about Amazon.com is that the sales growing at a rate of 3,000 percent annually and it is the country’s third-largest bookseller, the company has yet to make a dime.
But like Bezzo says “There are always three or four brands that matter,” and “With the lead we have today, we should be the No. 1 player.”