While almost every IT company is blaming almost everything it can on the poor economy, one company shows that you can succeed even when the chips are down
While almost every IT company is blaming almost everything it can on the poor economy, one company shows that you can succeed even when the chips are down
When the going gets tough, the tough get going. And one company that seems to have lived up to this adage is Amazon.com.
Wikipedia tells us that the river after which the company is named is the largest river in the world by volume, with a total river flow greater than the next top ten largest rivers flowing into the ocean combined. Similarly, the company called Amazon, which was founded in 1994 by Jeff Bezos, is according to the same source America's largest online retailer, with nearly three times the Internet sales revenue of runner up Staples.
And while Amazon has normally done well, it is now that it deserves our applause more than ever because it has done well when everything is down. In fact, for the OND 2008 quarter, net income increased 9 per cent to $225 million. For the full year 2008, net sales increased 29 per cent to $19.17 billion, or 28 per cent excluding the $127 million favourable impact from year-over-year changes in foreign exchange rates throughout the year, compared with $14.84 billion in 2007.
But more than praise, let us look at what we can learn from Amazon that will be relevant to not just the rest of the IT industry, but the world's economy as well:
>>Stay focused: While a lot of us keep harping on this, it is easy to forget this. But Amazon didn't. As Jeff Bezos, founder and CEO of Amason.com said, "We remain relentlessly focused on serving customers with low prices, great selection and free shipping offers."
>>Capture other markets: While Amazon is well known in the US, its popularity is not restricted just to the US. It is respected even in the UK. In fact, according to a survey conducted by Verdict Research, Amazon was the UK's favourite music and video retailer.
>>Be elastic: In August 2006, Amazon introduced Amazon Elastic Compute Cloud or Amazon EC2, which is a virtual site farm that allows users to use the Amazon infrastructure with its high reliability to run diverse applications. In 2008, Amazon improved the service adding Elastic Block Store (EBS), offering persistent storage for Amazon EC2 instances and Elastic IP addresses, static IP addresses designed for dynamic cloud computing.
And all this was possible because Amazon knew how to make its infrastructure which is designed to meet the humongous Christmas shopping demandu2014serve other purposes.
>>Diversify: While Amazon started out as an online bookstore, it has diversified into a company that sells diverse items like DVDs, music CDs, software, video games, furniture, and even food.
>>Pay attention to small details: While Amazon is big, it pays attention to the small details. For instance, it has come up with something called frustration-free packaging that is designed to make it easier for people to unwrap gifts. While this is good for the customer, it is also easier on the environment.
>>Go with the flow: While books are still doing well, e-books are seen as the way of the future. To tap this, Amazon launched Kindle, an e-book reader that is said to have the largest collection ever of book titles that add up to 230,000 titles. Of this, 45,000 were added in OND 2008, showing the company's commitment to Kindle.
We could go on, but the main lesson from Amazon is that the basics of business remain unchanged. Recession or no recession.
QUICK TAKE
>>Amazon is doing well while others are suffering
>>Its net income for OND 2008 increased 9 per cent to $225 million
>>Much of this success comes from its clear strategy
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