In 1997, when Amazon first went public, Jeff Bezos wrote what may be an important letter to shareholders from any firm. In it, he laid out a imaginative and prescient for the corporate he based in his storage that appeared, on the time, fairly completely different than what had come earlier than.
What Bezos wrote then was so vital to Amazon as an organization that it has been hooked up to each subsequent shareholder letter since. It described Bezos’ dedication to give attention to the long run, even when it meant shedding cash within the brief time period.
Amazon undoubtedly is not shedding cash anymore. In reality, as Bezos approaches the tip of his time as CEO of Amazon, the corporate introduced what can solely be described as its finest quarter ever.
From a pure numbers standpoint, this wasn’t Amazon’s greatest quarter. That might be the one which resulted in December when the corporate posted $125.5 billion in income. That is smart. Not solely does that timeframe embody the vacation purchasing season, however Amazon additionally held its Prime Day sale throughout October final 12 months. That two-day occasion alone accounted for $10.4 billion in income.
Final quarter, nonetheless, had no such increase, however the on-line retailer nonetheless generated $108 billion, and greater than $8 billion in profit-the latter of which was the very best ever for the corporate.
As I listened to Amazon speak about its outcomes, I used to be reminded of three phrases from that letter that, trying again, appear virtually prophetic by way of what we have seen over the previous few months. The three phrases?
“Obsess Over Prospects”
You may draw a straight line from the phrases Bezos wrote 24 years in the past, to the corporate’s outstanding success over the previous 12 months. Because the pandemic took maintain, there was actually no firm higher positioned to fulfill the extraordinary wants of its clients than Amazon.
On the time, Bezos defined it like this:
From the start, our focus has been on providing our clients compelling worth. We realized that the Net was, and nonetheless is, the World Broad Wait. Subsequently, we got down to supply clients one thing they merely couldn’t get some other approach, and started serving them with books. We introduced them rather more choice than was doable in a bodily retailer (our retailer would now occupy 6 soccer fields), and offered it in a helpful, easy-to-search, and easy-to-browse format in a retailer open 12 months a 12 months, 24 hours a day. We
maintained a dogged give attention to bettering the purchasing expertise, and in 1997 considerably enhanced our retailer.
Despite the fact that these phrases have been written 24 years in the past, they’re precisely why Amazon simply had its finest quarter ever. Amazon was obsessive about assembly the wants of its clients, and has been relentless in its dedication to serving them higher.
When individuals weren’t certain if it was protected to depart house to purchase the straightforward gadgets they wanted every day, Amazon had already constructed one of the vital environment friendly techniques ever imagined for turning just a few clicks on an internet site right into a brown field in your entrance porch. That is why hundreds of thousands of Individuals went on-line to seek out all the things from bathroom paper, to non-public care gadgets, to groceries.
Brian Olsavsky, Amazon’s chief monetary officer defined it within the context of turning “clicks into productive gross sales. If a buyer finds what they’re searching for, at a worth they’re keen to pay, with out having to attend greater than a day or so for it to be delivered, they make a purchase order. That is a productive sale.
The muse for that did not begin this quarter. It did not occur final 12 months when the world got here to a cease. It occurred with an thought specified by a letter that got here to outline the corporate’s selections for greater than 20 years. Should you obsess over your clients first, you will be ready to earn their enterprise.
“We’re nonetheless within the early phases of studying learn how to convey new worth to our clients by way of Web commerce and merchandising,” Bezos wrote. “Our aim stays to proceed to solidify and prolong our model and buyer base. This requires sustained funding in techniques and infrastructure to help excellent buyer comfort, choice, and repair whereas we develop.”
In brief, it requires an organization to obsess over its clients. He may have written these phrases about this final quarter. As an alternative, the truth that the corporate has lived them out for twenty-four years is why it simply had its finest quarter ever.
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