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As evidence of his strategic shipping positions, Amazon CEO Jeff Bezos not only aspires to be the undisputed leader of online sales, but of the global economy.
Parts of Amazon’s strategy are well known. They are part of a vision developed in 1997: “to build the world’s largest store”. An ambition symbolized from the beginning by the yellow arrow of its logo, which connects the letters A and Z of the Amazon name, a way of saying: “Amazon sells everything from A to Z”.
From the early years, Jeff Bezos, its founder, explained in the book “Get Big Fast”, by Robert Spector, that he didn’t want to be a “product company” but a “customer company”, easily word, a company that is primarily customer -focused. Starting to sell books was just a way of educating customers, at the time, about buying online, using a product that was specifically suited to selling on the Internet (familiar to customers, easy to display on the web, logistically simple, cheap, etc.).
The leader of global change
The sequel is already known. Huge investment to introduce a unique customer experience, offer an exceptional offer and ensure an unprecedented delivery service. Accelerates innovations by hiring one of the first smart agents (Firefly) to make product recommendations, the introduction of ratings and comments on articles, one-click ordering, free shipping, etc.
In 2005, Amazon will stand up to publishing by buying BookSurge (named CreateSpace) and inviting its customers to give themselves a Kindle. The advent of the marketplace will allow brands to sell their products online on Amazon and significantly increase the size of the e-commerce giant’s catalog.
A strategic pivot will allow the company to start with cloud computing, with Amazon Web Services (AWS) in particular, and become a competitor to Oracle, IBM or Cisco.
Now, Amazon is stepping into our homes by encouraging us to attach “dash buttons” to our refrigerators (connected buttons that only need to be pressed to order products directly, editor’s note) to take part in the Internet of Things. It accelerates its efforts in the field of artificial intelligence with Alexa, the voice assistant for Amazon Echo’s connected speakers (also read the column: “Why artificial intelligence changes the user experience”).
Amazon’s unofficial approach
But Amazon’s real strategy isn’t the one that’s officially shown. In 2016, Amazon was licensed by the Federal Maritime Commission to set up a shipping service with “Ocean Transportation Intermediary” status. In other words, Amazon can now deliver the goods of others. This service, called FBA (Fulfillment By Amazon) will allow Chinese companies to export their products more efficiently, and at cheaper, to other parts of the world.
The ocean freight market, most of which is traded in the Pacific, is worth $ 350 billion a year (€ 298 billion), but offers low margins (carriers charge $ 10 for screen shipping) dish). This is an unattractive business, unless your name is Amazon. The price of transportation is mainly explained by the cost of labor: loading and unloading of goods, administrative management, etc.
Amazon fully understands that it can deploy an entire fleet of algorithm-assisted robots, as is already happening in its warehouses, to reduce these costs. With its drones, its semi -trailers, its maritime agreements in the Pacific – all overseen by Jeff Helbling, a former U.S. Navy captain, now technical adviser to Jeff Bezos – Amazon is setting up of the world’s largest logistics infrastructure.
The unconscious approach of Amazon
But it is by looking at the very unconscious of Jeff Bezos, the richest man in the world, that perhaps the key to Amazon’s strategy is found (see also the article: “The numbers in Jeff Bezos’ head ”). Some key characteristics of his personality undoubtedly explain his approach.
narcissism. The man will have a talent for seduction, seduction, seduction. Thus, he was able to literally reverse the way investors thought. Usually, the latter wonders how to get the best competitive advantage with the least possible capital and investment. Jeff Bezos convinced them to ask the question in the other direction by asking themselves: how to gain a competitive advantage that is so expensive that no one else can compete with us.
In this approach, Amazon enjoys exceptional treatment from investors and shareholders. Thus, the company is known for having benefited, since its creation, from consolidated investments of unattainable value. According to consulting firm PwC’s “Global Innovation 1000” ranking, the e-commerce giant invested 16.1 billion dollars (13.7 billion euros) in R&D in 2017, thus becoming the first leading technology company in this field. track record.
But Amazon benefits largely from a market capitalization that gives it access to massive amounts of money at low cost. Will Wall Street be a mirror where Jeff Bezos admires himself, like Narcissus looks at himself in the reflection of the water of a spring, before fainting?
the parricide. The man, whose company was still young, seemed to systematically want to kill the one who gave birth to him. After selling books and killing book sellers, Amazon attacked publishing in an attempt to kill this sector, which nonetheless produces books. After selling the brands ’products, Amazon invited them to its marketplace, which is now used as a heavy laboratory to identify the categories of products that work best commercially, in order to launch lines of competing products, under the Amazon brand. The company owns at least forty brands of its own, mainly in the textile field.
The fratricide. The man is largely engaged in the career towards the company that will reach the first 1000 billion dollars, shoulder to shoulder with Apple, Facebook and Google. GAFAs are more competitive than they seem. Amazon sells tablets (Kindle) and music, as does Apple. Google has an operating system for smartphones, just like Apple. Facebook has generated online sales, as has Amazon. Google has Gmail and Facebook, its instant messenger, Messenger.
And there, Jeff Bezos seems to want to “amazon” everyone around him again, by becoming Google’s more frontal competitor to his core business. Today, 55% of product searches on the Internet are on Amazon, compared to only 28% for Google. Was Jeff Bezos the new Romulus who killed Remus before the city of Rome was founded, or was Cain the one to confront his younger brother Abel?
The purity. Jeff Bezos understands that his real rival is no longer Walmart, which has long been considered an American symbol, but more serious opponents of e-commerce, Chinese in this case, such as Alibaba, Tao Bao or Tencent. Given his patriotic and national dignity, will Jeff Bezos have temptations, even national ambition, that will push him to look in Washington’s direction? Mark Zuckerberg, the founder of Facebook, was identified with the ambition to target the White House. Will the two bosses one day face off in a televised debate, to be broadcast on YouTube, where the issue is the U.S. economic leadership in the world?
Until then, one thing is certain: the new economy (renamed the “next economy” by the Americans) will not be played in the air, with drones, but on the seafront.
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