The Story of Amazon.com: How a Bookstore Conquered the Internet

Summary

The video script narrates the journey of Amazon from its modest beginnings to becoming a dominant e-commerce giant. It highlights Jeff Bezos' decision to start Amazon, the strategic choice to sell books initially, and the company's expansion into a vast marketplace. The script also delves into Amazon's business model, revealing that it operates at a loss on direct sales but compensates through profitable subsidiaries like Amazon Web Services (AWS). It touches on controversies surrounding Amazon's tax practices and working conditions, and concludes with a promotion for a new startup marketplace, joysk.com, offering an alternative to Amazon's competitive platform.

Takeaways

• 🛒 Jeff Bezos is the founder of Amazon.com, an online marketplace known for its vast product selection.
• 📈 Amazon offers over 100 million different products and shipped about 5 billion items in a year, accounting for nearly 40% of all internet sales.
• 💸 Contrary to popular belief, Amazon operates at a loss on nearly every purchase made through their website.
• 🚀 Amazon started with modest beginnings in the 1990s, focusing on selling books due to their high demand and large title availability.
• 📚 The company expanded its product range beyond books in 1998, a move that significantly increased its revenue to nearly one billion dollars.
• 📈 Amazon went public in 1996, with its stock IPO'ing at around $1.50 per share, which would be worth approximately $10 million today.
• 📉 The company faced challenges during the dot-com bubble, with its stock price dropping from a high of $113 to a low of $5.51.
• 🛍️ Amazon introduced Amazon Prime in 2005, offering free two-day shipping on select products, which initially caused the company to lose money on each shipped item.
• 🌐 Amazon Web Services (AWS) was launched in 2005 as a subsidiary, providing cloud computing services and becoming a significant profit driver for Amazon.
• 💼 Amazon has been criticized for not paying taxes, having anti-competitive practices, and poor working conditions in their warehouses.
• 🆕 The script also mentions a new startup marketplace called Joyce.com, which is in the alpha testing stage and aims to offer an alternative to Amazon for both buyers and sellers.

Q & A

Who is the founder of Amazon.com and what is their claim to fame?

Jeff Bezos is the founder of Amazon.com, which is known as an online marketplace where consumers can buy a wide variety of products.

How many different products does Amazon offer for sale?

Amazon offers over 100 million different products for sale.

What percentage of internet sales does Amazon account for?

Amazon accounts for nearly 40% of everything sold on the internet.

How does Amazon make money if it loses money on nearly every purchase made through their website?

Amazon makes money through various subsidiaries, such as IMDb, Audible, Zappos, Twitch, and Whole Foods, as well as through Amazon Web Services (AWS), which provides cloud computing services.

What was Amazon's original name before it became Amazon.com?

Amazon was originally named 'Cadabra, Inc.', but the name was changed after a lawyer misheard it as 'Cadaver, Inc.' Bezos then considered 'Relentless' before finally settling on Amazon.com.

Why did Jeff Bezos decide to start an e-commerce company?

Jeff Bezos decided to start an e-commerce company because he noticed the massive growth opportunity presented by the internet and did not want to have regrets later in life about not pursuing it.

What was the first product category Amazon focused on selling?

Amazon initially focused on selling books due to their high demand, the large number of titles available, and the low price point.

When did Amazon go public and what was its initial stock price?

Amazon went public in 1996 and its stock IPO'd at the equivalent of a dollar and fifty cents per share.

How did Amazon expand beyond just selling books?

In 1998, Amazon decided to expand beyond books and started selling a wide variety of products, which was the first step towards becoming the 'everything store'.

What is Amazon Web Services (AWS) and how does it benefit Amazon's overall profitability?

Amazon Web Services (AWS) is a subsidiary company that provides cloud computing services, hosting websites and applications for customers and businesses. It has a high profit margin and makes up nearly all of Amazon's profit, compensating for losses incurred by Amazon Marketplace.

What challenges has Amazon faced in terms of public perception and business practices?

Amazon has faced challenges such as allegations of not paying taxes, anti-competitive advantages over other businesses, and poor working conditions in their warehouses.

What is the relationship between Amazon's Marketplace and AWS in terms of revenue and profit?

While Amazon Marketplace makes up a larger portion of Amazon's revenue, it operates at a loss. AWS, on the other hand, has a significant profit margin and contributes the majority of Amazon's overall profit.