Amazon’s secret weapon: Reinvention and Smart Business
It’s no surprise that Amazon dominates the market. There’s a reason why the retail giant generated $136 billion in revenue for 2016. The company has the innate ability to reset expectations and continuously turn a profit.
At one point, analysts were skeptical of Amazon’s Web Service cloud computing platform (AWS). They stated that this venture was bold and risky for the retail giant. Amazon pushed forward and exceeded all expectations. In the first quarter of 2016, AWS sales skyrocketed to $2.57 billion.
Amazon’s success wasn’t build overnight. Their secret sauce is a mix of high quality yet simple ingredients: Reinvention and smart marketing. For years, Amazon has understood the power of email to drive real revenue and encourage repeat purchases from their users. As an Amazon customer, I receive targeted emails based on my purchase behavior and product interests. Amazon harnesses the power of data to understand each user. In addition, Amazon’s emails are simple and direct with a single call to action. The personalization of their emails is a clear example that segmentation, consistency and simplicity wins.
Secondly, Amazon’s growth is continuous innovation. Amazon combines brand power, customer expectations and whether or not the market will adopt a new product. Amazon stays ahead of the curve by understanding market trends and their competition. Furthermore, Amazon’s culture for innovation inspires its employees to embrace change and remain competitive. Bezos stated in an interview that Amazon’s culture isn’t for everyone. He stated that he wants the company to avoid a “one-size-fits-all” culture of decision making. He emphasizes the importance of constantly assessing and adjusting Amazon’s culture so it never loses the agility, nimbleness, and hunger for experimentation that made the company so successful. Bezos also states that employees who cannot adapt to continuous change will not make it at Amazon. It’s a culture that thrives on pushing the boundaries and accepting failure in order to reinvent. In other words, walk the walk and embrace high- risk experiments. Most people can find this overwhelming but for others, pushing the boundaries and accepting failure as a catalyst for change is the only way to succeed in a competitive market.
Amazon’s success and growth might leave some scratching their heads and wondering how they do it. In reality, their pillars of success are a combination of smart business tactics, customer centricity, and continuous optimization.