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January 6 - May 2, 2021
It mimics religion with its own belief system, objects of veneration,
Our economy and prosperity are largely predicated on others’ consumption.
Customer Relationship Management (CRM),
The notion of differentiation through service, and of becoming the customer’s temporary friend and shopping guide, broke new ground.
“the customer is always right”
The march toward “more for less” created a vacuum for consumers looking for expertise and a social signal of something aspirational about their lives.
On Amazon, Bezos realized, every page can be a store and every customer a salesperson. And the company could grow so fast that there wouldn’t be any corners left for competitors to carve out a niche.
Brands are two things: promise and performance.
Amazon appeals to our hunter-gatherer instinct to collect more stuff with minimum effort.
This kind of experimentation and aggression is what the military calls the OODA loop: “observe, orient, decide, and act.”
Who’s losing? Everyone. The graph below, describing ten-year stock appreciation of major U.S. retailers
The 3.4 million Americans (2.6 percent of the U.S. workforce) employed as cashiers.
Amazon’s customers trust it so much that they’re allowing the company to listen in on their conversations and harvest their consumption data.
In the short term, Go and Echo suggest that the company is headed toward zero-click ordering across its operations.
Leveraging big data and unrivaled knowledge of consumer purchasing patterns, Amazon will soon meet your need for stuff, without the friction of deciding or ordering. I call this concept Prime Squared.
Amazon’s unwavering focus on making consumer purchases increasingly frictionless, its facility with investor relations, and its decision to invest in B2B (platform services for competitors) place it in the pole position for the race to a trillion.
This cuts to Amazon’s core competence: storytelling.
The story is told via media outlets, especially those covering business and tech. Many of them have decided tech CEOs are the new celebrities, and they give Amazon the spotlight, center stage, and star billing anytime.
Amazon has trained the Street to hold them to a different standard—to expect higher growth but lower profits.
“Given a 10 percent chance of a hundred times payout, you should take that bet every time.”
History favors the bold. Compensation favors the meek.
“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?”
We are now in the multichannel era—a time when integration across web, social, and brick and mortar is crucial to success.
It now has bookstores in Seattle, Chicago, and New York City (with others planned for San Diego, Portland, and New Jersey). 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,
Consumers increasingly prefer a channel-agnostic experience, where digital (specifically your smartphone) serves as the connective tissue between consumer, store, and site.
The ability to reserve something on her phone, pay later on mobile or desktop, pick it up in store, and never have to wait in a checkout line is damn near unbeatable.
Prime members represent recurring revenue, loyalty, and annual purchases
that are 40 percent greater than non-Prime members.
But when shopping habits migrate online, the design and feel of a product matter much less. There is no visual merchandising, no endcaps with carefully displayed products.
Meanwhile the 460 Whole Foods stores became Amazon’s supply chain—a delivery hub for Amazon Fresh and a transit hub for its other operations.
AI, purchase history, warehouses within twenty miles of 45 percent of the U.S. population, millions of SKUs, voice receptors in the wealthiest American households (Alexa), ownership of the largest cloud/big data service, 460 (soon thousands) brick-and-mortar stores, and the world’s most trusted consumer brand.
In reality, 55 percent of product searches start on Amazon (vs. 28 percent on search engines such as Google).118 This shifts the power, and margin, from Google and retailers to Amazon.
Consumers no longer go to stores for products, which are easier to get from Amazon. They go to stores for people/experts.
What’s clear is that we need business leaders who envision, and enact, a future with more jobs—not billionaires who want the government to fund, with taxes they avoid, social programs for people to sit on their
couches and watch Netflix all day. Jeff, show some real fucking vision.
In the first quarter of 2015, the iPhone accounted for only 18.3 percent of the smartphones shipped globally, but 92 percent of the industry’s profits.20 That’s luxury marketing. How do you elegantly communicate to friends and strangers that your skills, background, and achievements put you in the 1 percent, no matter where you are? Easy, carry an iPhone.
I’ve been advising luxury brands for twenty-five years and believe these firms, from Porsche to Prada, share five key attributes: an iconic founder, artisanship, vertical integration, global reach, and a premium price. Let’s dig into each of these more deeply.
“objects that appear effortless … so simple, coherent and inevitable that there could be no rational alternative.”
