Tag Archives for " Jeff Bezos "

4 Putting Amazon In Perspective

How could my 79-year-old mother possibly be a poster child for Amazon.com? When it comes to technology, she’s utterly hopeless… She’s never written or received an e-mail in her life. She’s never  Googled anything, or referred to Wikipedia. And to her, a twitter is something finches do.

And yet here she is, contently reading yet another novel on her Amazon Kindle.


The new  Kindle.

The new Kindle.


About a year ago my mom had a “micro stroke” that affected the optical nerve in her right eye. Made it almost impossible to read for any length of time, and typical, 12-point type is almost impossible to decipher. To make matters worse, the little library in her town can’t afford many large print books. So she was stuck.

Enter the Kindle.  Critics have panned it for being technologically archaic, and like Sony’s book reader, “bound to go nowhere.” Some say it’s just another pet project of Jeff Bezos, like his exploits in the commercial space race. And Wall Street analysts say it’s such a tiny piece of Amazon’s model, it’s too small to even consider.

But it’s a big deal to my mom. And to me, it’s symbolic of everything good about the Amazon brand.

In the 4th quarter of 2008, when the rest of the retail world was sucking wind, Amazon reported its best holiday season ever. Net sales increased 18% to $6.70 billion, compared to $5.6 billion in fourth quarter 2007. For the year, net sales increased 29% to $19.17 billion, and net income was up 36%.

As Fortune Magazine put it, “By virtually any measure — market share, revenue, profit, stock price, customer satisfaction, international reach  — Amazon Inc. is thriving.”

But why?  Why did Amazon survive the dot-com crash when so many brands fizzled into oblivion? Why did Amazon become the world’s largest on-line retailer? Why does the Amazon brand rank so well on virtually every brand loyalty index?

Because they treat all their customers like my mom.

Bezos started out during the dot-com boom with a plan to sell a lot of books on the internet. And he certainly accomplished that. Amazon went public in record time. All his investors, including his parents, made a fortune. He was even voted Time Magazine’s man of the year in 1999.

But unlike many of the CEOs of the day, Bezos was thinking long-term. From the very beginning he understood that the success of his brand hinged on one thing:  An unrelenting focus on the customer.

That’s the brand mantra of Amazon. To this day, Bezos continually sells Amazon as the most customer-centric company on earth. When he has a tough decision to make, he always defaults in favor of the customer. Often at the expense of short-term profits.

When Amazon added the customer review function many people thought they were crazy. The assumption was that bad reviews would hurt sales. In fact, the transparency boosted sales and help solidify a truly interactive brand relationship with millions of people. Now customer-generated reviews are standard procedure in the e-commerce world.

Amazon’s short-lived TV campaign is another example of how Amazon stays true to its brand. “We did a 15-month-long test of TV advertising in two markets – Portland, Oregon, and Minneapolis – to see how much it drove our sales,” Bezos said in a 1997 interiview. “And it worked, but not as much as the kind of price elasticity we knew we could get from taking those ad dollars and giving them back to consumers. So we put all that money into lower product prices and free shipping. That has significantly accelerated the growth of our business.”

They haven’t run a mass media campaign since, and yet the Amazon brand has grown even stronger. Suppose, maybe, it’s the customer’s experience that cements long-term brand relationships, not advertising?

Bezos believes their focus on the customer has also helped Amazon launch innovative new products and services over the years, like Amazon Prime pre-paid shipping and a host of services for small e-commerce companies.

“We wanted to have a customer-focused culture. We consciously tried to get that. If you’re competitor-focused, you have to wait until there is a competitor doing something. Being customer-focused allows you to be more pioneering.”

Which brings us back to my mom’s Kindle. 

The scalable type is plenty big enough for her to read. There are 230,000 titles to choose from.  It’s simple to use, (with some assistance  from my dad on the downloads.) There’s no annual contract and no monthly bill. And the new, second generation Kindle will even read outloud to her. 

It’s everything she would have ever asked for, if she could have dreamed of such a thing.

To my mom, the Kindle isn’t an electronic gadget. It’s not about the sophisticated wireless connection or any other technological leap. It’s just a tool that enables her to do what she’s always done… curl up with a good book. And for that, we’re genuinely grateful to Bezos and his team. 

5 How to differentiate your small business.

There are more than 20 million businesses registered in America, but only 17,000 are what the Department of Labor calls “large” businesses. So forget about the giant brands like Microsoft, GM and Nike. Let’s look at how you can differentiate yourself from the millions of small businesses that don’t succeed.

the E Myth on the Brand Insight Blog top 100 branding blogThis is about small business branding. The single biggest challenge is that most businesses are started by technicians. They’re not branding experts, marketing gurus or even professional managers. They’re skilled specialists. (Think about all the painters, lawyers, programmers and copywriters who hang up a shingle.)

These technicians make the fatal assumption that because they understand the technical work of a business, they  understand the business itself. And that’s just not true.That’s the crux of The E Myth, by Michael Gerber. If you have a business, or are planning to go into business of any kind, buy that book and refer to it constantly.

Architects are a good example. Just because you can design great buildings doesn’t mean you can run a great architecture firm. Talent, by itself, isn’t a differentiator.

You see it in professional spin-offs all the time… Two or three key architects in an established firm leave with a few clients, just knowing they can do it better on their own. But they start a company that’s cut from the exact same cloth as the last place they worked. They use the same accounting software, the same processes, the same fee structure, and even the same spiel in their pitches.  The only thing that’s changed is the location and the letterhead.

So why are they surprised when they run into the same challenges and problems that their former firm experienced? All they have is a me-too firm based on a fundamentally flawed model of other me-too firms.

No matter what line of work you’re in, a great way to differentiate yourself is to adopt a business model that doesn’t fit the conventional mold of your industry. Here are a few examples from big business:

southwest airlines branding brand insight blog• Herb Kelleher started Southwest airlines with an idea on a napkin… discard the airline industry’s old hub-and-spoke model and discount fares dramatically.

• Ray Kroc threw out the conventions of the restaurant business and introduced assembly line production at McDonalds.

McDonalds and small business branding • Jeff Bezos, founder of Amazon.com, started selling books out of his garage, proved all the naysayers wrong and built the world’s largest on-line retailer.

Those companies were built on a proprietary system of doing business that differentiated them from the competition. For Ray Kroc it wasn’t the hamburgers, it was how the hamburgers were made. It’s what Gerber refers to as a business format franchise.

If you’re Joe The Plumber and you want to build a plumbing empire, you have to do a lot more than just fix pipes. You also have to wear the strategist’s hat, the manager’s hat and the entrepreneur’s hat. If that’s not possible, then hire someone to do that thinking and planning with you. Not for you.

Here’s inspiring example of small business branding I’m sure you haven’t heard of:

In 1985 Scott Campbell graduated from Veterinary School and bought a small animal clinic in Portland, Oregon. But instead of spending all his time treating fleas and ticks, he started working on the business. He devised a long-term strategy. He built new business systems and installed computers. He devised new policies. He hired BNResearch to track customer satisfaction. In order to provide a better level of care for pets, he did everything Gerber recommends in The E Myth. Scott Campbell didn’t work in the business, he worked on it. He did market research, he implemented processes and paid attention to his branding. He seldom saw pets after the first year or so.

Campbell’s company, Medical Management Inc, (MMI), took off. When it sold to Mars, Inc. in 2008 there were over 500 Banfield Pet Hospitals worldwide, each doing approximately $2.5 million a year.  I’m quite sure that makes Scott Cambell the wealthiest veterinarian in history.

The point is, if you want your business to pay off, do something different!  Being good isn’t enough. You also have to be good in different ways. You can’t differentiate yourself if there’s nothing different about the way you’re doing business.

Thirty years ago you could differentiate your business simply by doing better advertising than the competition. But that’s not enough anymore. You also need something genuinely, substantially better to put in your ads.

It’s tough to be different, especially for a service business. But that’s actually good news! If it were easy, all your competitors would be unique and exciting, and you wouldn’t stand a chance.  The fact is, you don’t have to do everything well in order to succeed. You just need to do some things differently and some things well. As Gerber puts it, you need to work ON the business as much as you work IN the business.

Looking for more insight on small business branding and marketing? Try this post.