The Four: The Hidden DNA of Amazon, Apple, Facebook, and Google

by Scott Galloway

They live for today and acknowledge that great success only comes with significant...

There is a survivor bias that plagues old-economy CEOs and ...

CEO pay has become so crazy that on a risk-adjusted basis, you’re better off staying out of traffic, logging your six to eight years, and retiring rich.

History favors the bold. Compensation favors the meek.

Terrific line!

Big companies may have more assets to innovate with, but they rarely take big risks or innovate at the cost of cannibalizing a current business.

They play not to lose, and shareholders reward them for it—until those shareholders walk and buy Amazon stock.

Most boards ask management: “How can we build the greatest advantage for the least amount of capital/investment?”

Amazon reverses the question: “What can we do that gives us an advantage that’s hugely expensive, and that no one else can afford?”

Why? Because Amazon has access to capital with lower return expe...

Reducing shipping times from two days to one day? That will require billions. Amazon will have to build smart warehouses near cities, whe...

By any conventional measure, it would be a huge investment fo...

But for Amazon, it’s all kinds...

Consumers love it, and competitors stand flaccid on the sidelines.

Amazon is going underwater with the world’s largest oxygen tank, forcing other retailers to follow it, match its prices, and deal with changed customer delivery expectations.

The difference is other retailers have just the air in their lungs and are drowning. Amazon will surface and have the ocean of retail largely to itself.

“Failure and invention are inseparable twins. To invent you have to experiment, and if you know in advance that it’s going to work, it’s not an experiment.”

Amazing Bezos quote

The Four are all disciplined about getting out in front of their skis, taking big, bold, smart bets, and tolerating failure.

This failure gene is at the heart of Amazon’s and, more broadly, the U.S. economy’s success.

No other society would tolerate, much less reward me. America is the l...

Most uber-wealthy people have one thing in common: failure. They’ve experienced it, usually in spades, as the path to wealth is fraught with risks,

A society that encourages you to get up after being beaned in the head, dust off your pants, step back into the batter’s box, and swing harder next time is the secret sauce for printing billionaires.

The correlation is clear. America has the most lenient bankruptcy laws, attracts risk takers, and, as you...

A combination of a winner-take-all ecosystem, accelerating customer acquisition, last-mile costs, and a generally inferior (online) experience, makes pure-play e-commerce untenable.

Amazon doesn’t escape this fact.

But even if Amazon’s core business (pure-play e-commerce) is a difficult on...

the immense value Amazon has delivered to consumers has created the most trusted and reputable c...

Amazon has dominated e-commerce sales volume, but its business model isn’t easily replicated or sustained.

In the past few years, Amazon has traded on this brand equity, leveraging it to extend into other businesses, and has expanded into other, simply better (more profitable) businesses.

Looking back, Amazon’s retail platform just may have been the Trojan horse that established the relationships and brand later monetized with other businesses.

while the world still thinks of Amazon as a retailer,

it has quietly become a cloud company—the world’s biggest.

make Amazon Media Group the third largest digital media property, after Facebook and Google.

At the apex of its power, Walmart never had its own planes or drones.

In early 2016, Amazon was given a license by the Federal Maritime Commission to implement ocean freight services as an Ocean Transportation Intermediary.

So, Amazon can now ship oth...

The biggest component of that cost comes from labor: unloading and loading the ships and the paperwork. Amazon can deploy hardware (robotics) and software to reduce these costs.

Amazon is building the most robust logistics infrastructure in history.

conquer the retail landscape offline.

The truth is that the death of physical stores has been vastly overstated.

In fact, it’s not stores that are dying, but the middle class—and, in turn, the businesses that serve that once-great cohort and its neighborhoods.

So, stores are here to stay—if we are careful what stores we’re talking about. But so is e-commerce.

Ultimately, the real winners will be those retailers who understand how to integrate both. Amazon aims to be that company.

We are now in the multichannel era—a time when integration across web, social, and brick and m...

Everything points to Amazon dominating th...

This is why it made sense for Amazon to acquire Whole Foods, a 460-store franchise76 that gave Amazon a physical presence in urban centers, where affluent, fast-to-reach consumers live.

Key to success in the multichannel era is knowing which channel to optimize and how to cater to our hunter-gatherer instincts.

Why does Amazon—bookstore killer—need brick-and-mortar bookstores? To sell the Echo, Kindle, and its other goods.

Customers want to see, touch, and feel products,

Walmart was frustrated they weren’t making progress in online sales, and their frustration was justified.

As Amazon marched on, Walmart’s e-commerce sales growth had slowed, even flattened.