USA: TECH-KNOW - The people and products shaping your future - State of the art - amazon.com.

USA: TECH-KNOW - The people and products shaping your future - State of the art - amazon.com. - Venture capitalists tell me that, nestled like a talisman within almost every e-commerce pitch they receive, there is at least one awestruck allusion to 'revo

by HUNTER MADSEN hmadsen@improvenet.com.
Last Updated: 31 Aug 2010

Venture capitalists tell me that, nestled like a talisman within almost every e-commerce pitch they receive, there is at least one awestruck allusion to 'revolutionary' Amazon.com, the web-based bookstore (www.amazon.com) that launched in 1995.

Since then it has chalked up over $500 million in sales and become the world's third largest bookseller. The brand exemplifies hassle-free net shopping. It has moved into music and video sales and we're told that consumer electronics, games and toys are next. It has pushed into Europe, too, with dedicated UK and German web sites.

Impressive, yes, but almost nothing in Amazon's approach is revolutionary.

Except for this: Amazon foresaw that the internet would proliferate countless new intermediary enterprises, pursuing tiny, diverse consumer segments.

It elected to harness them to achieve 'super-distribution in a networked environment'. That is, it encouraged any and all web sites to register as Amazon associates, sell a selection of books on their sites - customised to the niches they serve - and then link to Amazon for back-end fulfilment in exchange for 5% to 15% of the revenues. Amazon now has 190,000 associated web sites.

Thus, Amazon's founder, Jeffrey Bezos, pioneered the first principle of webonomic strategy: if you can't beat them, don't join them - make them join you.

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