When Jeff Bezos founded Amazon in 1994, it was to be an on-line bookstore. My how it has grown, diversified, and prospered. A piece of this incredible story can be found in Amazon’s 2012 Letter to Shareholders, released on April 12, 2012.
Where to start?
A good place to begin is with Amazon’s mission statement, which includes “To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices”. Look at the keywords:
- Earth – not the US, or developed nations but Earth and every one of us
- Customer-centric company – you know who is foremost in the hearts and minds of every employee starting with Jeff Bezos? You and me!
- Find and discover anything – the sky is the limit when it comes to SKUs
- Online – no bricks and mortar for them
- Lowest possible prices – Kindles sold at cost, storage prices reduced 27 times in 7 years
Lessons from the 2012 Shareholder’s Letter
Bezos states there are two ways to run the business: 1) Focus on impressing customers or 2) Focus on beating competition. Amazon chose the first option because this helped create a culture of being proactive in implementing the mission. The do not worry about what the competition is doing before acting; they act if it will be good for the customers. How many other companies do you know that fixate on “impressing customers”? And isn’t impressing customers another way to say consistently deliver a superior customer experience?
Here are two examples:
“We build automated systems that look for occasions when we’ve provided a customer experience that isn’t up to our standards, and those systems then proactively refund customers.”
With most companies, we have to call and complain when we have a poor experience, and the call center person may apologize and that’s it so we then ask to speak to a supervisor, etc. until a manager finally acknowledges their error and offers minimal compensation. At Amazon, their all powerful computer system, with extensive data mining capabilities, constantly searches for disappointments and issues a credit even before you are aware of the disappointment. And it alerts someone who can prevent the problem from reoccurring, who then uses problem solving techniques to develop and implement real corrective action
“When you pre-order something from Amazon, we guarantee you the lowest price offered by us between your order time and the end of the day of the release date.”
Their approach is for you to order something when you hear about it knowing full well that you will pay the offered price or less if Amazon’s price is reduced before shipment. No hassle, no worry, just peace of mind and trust that we will not be ripped off!
Speaking of trust, 7 years ago Amazon launched Amazon Web Service (AWS) to leverage it vast and growing data center infrastructure and expertise. It is now one of the leading storage center businesses in the world. Here is a direct quote from the 2012 letter:
“AWS Trusted Advisor monitors customer configurations, compares them to known best practices, and then notifies customers where opportunities exist to improve performance, enhance security, or save money. Yes, we are actively telling customers they’re paying us more than they need to. In the last 90 days, customers have saved millions of dollars through Trusted Advisor, and the service is only getting started.”
A few years ago my car had a non-safety, but annoying, defect and the only way I learned about the free upgrade available was to do an extensive web search – what a difference!
In July 2009, Amazon purchased Zappos, an online shoe and apparel company with a very unique culture that seems to go a little beyond Amazon. Here are 3 paragraphs from a Zappos CEO letter to all employees announcing the deal:
“Several months ago, they reached out to us and said they wanted to join forces with us so that we could accelerate the growth of our business, our brand, and our culture. When they said they wanted us to continue to build the Zappos brand (as opposed to folding us into Amazon), we decided it was worth exploring what a partnership would look like.
We learned that they truly wanted us to continue to build the Zappos brand and continue to build the Zappos culture in our own unique way. I think “unique” was their way of saying “fun and a little weird.”
Over the past several months, as we got to know each other better, both sides became more and more excited about the possibilities for leveraging each other’s strengths. We realized that we are both very customer-focused companies — we just focus on different ways of making our customers happy.”
This is almost saying that Amazon wanted to reinvigorate its customer-centric culture and learn how to add a sizeable does of employee centricity to itself. What a powerful message to send to customers and employees!
And this is what you can do in your business if you have the passion!
Good luck and be brave!