How Jeff Bezos Created One Of The Most Admired And Feared Companies In The World
There's hardly anywhere that Amazon can't reach its customers. Even on a remote island in Maine is not beyond the reach of Amazon.
Matinicus Isle, Maine, is one of the most remote inhabited islands in North America. They're completely off the grid.
This single cable is their lifeline to Amazon.
This family gets as many as three Amazon deliveries per week.
A washing machine arrived in rural Matinicus within two days of ordering it on Amazon.
Amazon has more than 240 million customers. So that's 6 out of every 10 adults in the U.S. who use the internet.
Founded by Jeff Bezos in 1994, Amazon is on track to bring in $9 billion a year in revenue.
Former employees describe Bezos as a driven, rational entrepreneur.
With a goofy side.
When Bezos first founded Amazon, there was no broadband, no Wi-Fi — just the internet. At the time, Bezos noticed that the web was growing at 2,300% a year.
The idea was to build a digital book store that wouldn't be limited by shelf space. At the time, Americans were spending $19,000 a year on books.
In 1997, Amazon went public.
Amazon was one of the few startups that didn't get wiped out by the dot-com bust. By 2001, the dot-com bust had claimed victims like Pets.com and eToys.com
Amazon was able to survive the bust by implementing layoffs, cutting down on costs, and emphasizing the importance of customer experience.
Today, Amazon's sales are still below Walmart's.
But it still sells more online than its 12 closest competitors combined.
Thanks to Prime, Amazon's $99-a-year premium service, earns the company $2.5 billion a year.
More than 25 million people use Prime. After they join, on average, those people actually double their spending on the site.
David Selinger is a former Amazon product manager. He was tasked with making sure there was very little friction in the online ordering process. He found that if the website was just 1/10 of a second slower, Amazon would lose 1% of its revenue.
Selinger is also the guy who proposed to sell advertising on the home page.
Bezos thought it was a stupid idea, Selinger said, but he was still willing to do it.
Today, Bezos is worth about $30 billion.
And he's spending it on things like space exploration ...
And acquisitions of things like The Washington Post. There's little to suggest that Bezos plans on slowing down anytime soon.
And that's a good thing for families in Campbellsive, Kentucky, which is where one of Amazon's fulfillment centers is located.
Thanks to Amazon's fulfillment center, members of this family were able to make $12.50 per hour, which helped pay for things like insurance and putting food on the table.
Each time someone clicks to buy something, a powerful apparatus is set in motion. These conveyor belts handle 426 orders per second.
An algorithm determines the appropriate size and type of box depending on the product.
Even though the machines do a lot of the legwork, employees may find themselves walking 15 miles or more per day.
Some employees even say that Amazon tracks their every step throughout the fulfillment center. Amazon will put employees on alert if they're not as productive as their counterparts.
Some people said that Amazon would intimidate employees and push them to their physical limit.
It eventually got so bad for workers that some were passing out from heat exhaustion.
Amazon added air conditioning to its fulfillment centers, and denies claims of improper treatment.
Amazon also argues that its data-driven approach is a big part of Amazon's success.
A good portion of Amazon's sales come from the more than 2 million independent sellers who do business on Amazon.
Independent sellers account for 40% of everything Amazon sells.
Amazon charges sellers a 15% fee up front. For additional money, Amazon will even take care of the storage and shipping of your products.
But some independent retailers are claiming that Amazon has undercut their sales. Rene Arnold, CFO of knife-maker Wusthof, stopped selling his products on Amazon when Amazon started selling its knives at below cost.
Amazon has also recently upset book publishers. Amazon controls more than one-third of the book industry.
TV personality Stephen Colbert recently spoke out against Amazon bullying publisher Hachette. Amazon is subjecting a lot of those books to artificial purchase delays, which results in fewer books sold.
Slashing prices in an already low-margin business is what put brick-and-mortar retailers out of business.
Amazon has played hard-ball with big publishers using a tactic known as "vendor realignment." If a publisher refuses to give Amazon a bigger discount on their books, Amazon buries those titles on the website to ensure that their sales plummet.
Despite hundreds of billions of dollars in sales, Amazon has barely turned a profit. But that doesn't seem to worry Wall Street. Amazon's stock is up 15,000% since the company went public.
More than 30 million people use Amazon's Kindle readers and tablets to explore all of Amazon's content and products.
After upending the publishing and retail business, Amazon is now assaulting the $600 billion supermarket industry.
Another promising venture for investors is Amazon Web Services, which is used by Netflix and the CIA.
Heading into the future, Amazon has plans for its massive new headquarters in Seattle.
And Bezos continues to challenge the status quo with things like the Fire Phone.
Refusing to think small, Bezos has toyed around with the idea of drone delivery.
The true vision for Amazon is 1-hour delivery for getting essentially anything to you as fast as humanely possible.
Heading over to Amazon for some headphones?
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