All things start small, even Amazon hasn’t always been the retail, logistics, media (and whatever other industries that come to mind) giant it’s known for today. It is the perfect example of how identifying future trends and playing the right moves, in addition to a having a great product, can differentiate a market-dominating company and one that bites the dust as competition gets tough. In Amazon’s case, its vision and strategy were what propelled the company to the success it has today.
Even with the book-selling website that it started out as, the long-term vision had always tainted every decision that the company makes. Having the view to dominate the ebook market, Amazon bought ebooks in bulk from publishers and sold them online through their Kindle platform, eating a loss with every sale to keep prices competitive, slowly attracting consumers to use their product and virtually keeping competitors out with their competitive pricing.
Amazon eventually dominated the ebook market. Although Amazon took losses in its endeavor to attract consumers to its ebook platform in the short term, it succeeded in gaining control of the overall market in the long term and benefits from the network effect – which is the idea that a product will become more useful as more people use it. This also applies to Amazon as a whole as its enormous user base creates endless opportunities for growth. A larger consumer pool would attract more suppliers, in turn, the increasing diversity of products for sale attracts, even more, consumers to the platform, and, with Amazon’s ventures into other industries, it is evident that its success is largely attributed to its enormous user base.
I for one started to buy products from Amazon through recommendations from a friend, after which I recommended the website to other friends, and just imagining the scope at which this process occurs is mind-boggling. Having already acquired a large portion of the market through cutting prices, its consumer base will continue to increase exponentially. Amazon played the long game and disregarded profitability in exchange for market dominance and is now projected to be worth $1 trillion in the near future, it is a testament to the importance that having a long-term vision – being able to predict future trends – and being a first mover has on business scope and success. Amazon’s vision can be applied not only to businesses and industries but also to everyday life. Shall one be insistent on success and getting ahead, a long-term goal and planning accordingly through short-term commitments will inevitably pay off in the end.
Word Count: 425
References:
Gershgorn, D., Griswold, A., Murphy, M., Coren, M. J., & Kessler, S. (2017, August 20). What is Amazon, really? Retrieved September 26, 2017, from https://qz.com/1051814/what-is-amazon-really/
Gobry, P. (2010, November 10). Here’s How Amazon Took The Lead In The Billion-Dollar EBook Market — And Why They’ll Dominate. Retrieved September 26, 2017, from http://www.businessinsider.com/amazon-billion-dollar-ebook-market-amzn-2010-11#built-the-right-product-for-the-right-audience-2
Kim, E. (2016, December 07). This chart shows how Amazon could become the first $1 trillion company. Retrieved September 27, 2017, from http://www.businessinsider.com/how-amazon-could-become-the-first-1-trillion-business-2016-12