Amazon on top. At the moment, it is America’s favorite IT company. This is evidenced by a survey conducted by The Verge magazine and the consulting firm Reticle Research. The good news for Amazon doesn't end there. Now it is also the fastest growing corporation in the world. Its annual revenue is expected to reach $ 200 billion next year, although some two years ago it was less than $ 100 billion. Amazon is now the fastest growing capitalization of $ 1 trillion.
On October 30, Amazon head Jeff Bezos, the son of a 16-year-old mother and a drunken father, became the richest man in the world. His fortune is now estimated at $ 94 billion, $ 28.5 billion more than at the beginning of the year. From Amazon, they watch movies (Prime Video and Fire TV), read books (Kindle), listen to audiobooks (Audible), stream games on Twitch. Smart column Echo helps in millions of homes, orders purchases, controls appliances and answers simple questions. Google Home and Apple HomePod, launched in response, can not even take away a fifth of the market. Where did Amazon, who started selling books from the garage, have such a success, and why do customers like it when she earns money from them?
What do US residents say
Amazon is the most favorite big IT company among Americans. And Twitter, by the way, is the most unloved (along with Facebook). The people interviewed by The Verge and Reticle Research value Amazon more than Microsoft, Apple, and Google, and almost no one is negative about it. For a company operating in the consumer market, such an attitude is the main key to success. If people value Walmart or eBay, they will visit these sites more often and make fewer purchases in their native Amazon. But so far, the brainchild of Jeff Bezos has successfully capitalized on its popularity, and is investing tens of billions in the development and marketing of its products. Some of these latest products can be found, for example, in the Amazon Basics section , where the company sells its own products. The Amazon algorithm notices what users like, and then releases the exact same product from itself, only two to three times cheaper.Smart column Echo
Americans like to save time and money out of the blue. So far, the company's strategy gives its result. According to a poll by The Verge, people trust Amazon as much as their bank. Of the five largest tech brands — including Apple, Google, Microsoft, and Facebook — Amazon won the most votes in the “how often do you recommend the company's services to your family and friends” category. When users were asked, without which company they could not imagine their life, the answer was the same. The absence of Amazon, people think, would be the most difficult thing for them. Interestingly, the second was Google, and Facebook was not even in the top 5.
There are several reasons for this trust in Jeff Bezos. His brand spends tens of billions of dollars every year, even to the detriment of financial results, trying to improve the quality of its services. Unlike Apple, which sits on the biggest “safety cushion” in the world ($ 262 billion), Amazon spends every year, almost to the last penny, on new products and business expansion. For example, after the purchase of Whole Foods grocery stores for $ 13.7 billion this year, the company first of all reduced the price of fruits, eggs and meat. Profit fell, but customer support rose to new heights. And the result - the corporation now largely controls the food, shopping, lifestyle and entertainment of Americans. Everything is done with an eye to the distant future, when user loyalty will begin to bring dividends.
Protection of information at any cost
Even Google sometimes releases unsuccessful products, like Google Glass. But every Amazon new invention is still becoming a hit and is entering people's home use, at least in the US. It happened with the Kindle, with the clever Echo assistant column, and with video services, and with Amazon Music. A failure can only be called an experimental smartphone Fire Phone, on which the company lost (a penny for it) $ 170 million.Jeff Bezos introduces new Amazon devices
What is more important - there are no rumors around Amazon that the company is selling or losing user data. No leaks of photos of naked celebrities, like Apple’s cloud service, and no sales of customers ’personal information to various advertisers like Google. Amazon’s business model is considered rigorous and fair. The corporation, obviously, is trying to conquer the world, but it does this without compromising the freedoms and rights of its users. In a survey on how big those. the company makes the most positive contribution to society, Amazon was again named first.
Best internet site?
The company makes a profit from dozens of sources. Last but not least, from the cloud web services Amazon Web Services used by Netflix, NASA, Reddit and another two thousand government agencies and large corporations. But its main "face" and the main pride is the online store Amazon.com, the largest and most profitable on the Internet.
Of course, it looks very so-so: its design has not fundamentally changed for many years. But by the basic parameters, this is the best site of the network, and the number of purchases on it speaks for itself. Amazon accounts for about 43% of all American online acquisitions, and its profits continue to grow at 20-25% per year. Experts give several reasons for this:
1. Amazon knows the user's taste.
A third of shoppers want more personalized shopping, says Infosys research. This increases the conversion of retailers, and Amazon is king. In truth, it even scares a little how much he knows about the desires of his users. All information about purchases account is collected and analyzed by the neural network. Over time, if a person makes enough purchases, in the "Recommendations" section there is more and more of what he may be interested in. And this is not the system where, if you looked and bought sneakers, you will try to offer five more pairs of sneakers. Instead, the robot may try to “push through” the spec. shoelaces, a spoon for shoes, even clothes of a similar style or the same brand that aroused the interest of buyers. And if a person does not order anything, an e-mail can be sent to him with a discount on the item he has been viewing.
2. Ease of purchase
Again, to increase conversion, the order of the goods must always be carried out as quickly as possible while the customer is “hot.” The CXL study showed that if there are only 5 steps from the site before the order, and the user does not have to enter unnecessary data, the conversion grows by 79%. Amazon goes even further: if the customer is registered and the product is in stock, you only need 2 or 3 clicks to buy. When you go to Amazon, your shopping cart is saved there - with all the things you put there. According to statistics, 24% of customers close the page without completing the order, but with plans to return to it. Amazon is trying not to lose them.
3. Social proof
Two thirds of people, according to KISSmetrics , are more likely to buy goods if there are ratings, reviews, and reviews next to it. Amazon goes even further. Customer reviews contain a photo (by the way, by the way, it’s easy to look for characteristic breakdowns / weak points of the product). You can “like” reviews, raising them up if they are useful, and “minus” or send them to a support if the user has not reported anything interesting. And before the reviews is a section with the most popular questions and answers about the product. Will the device work with your model? And how much in reality keeps charging? And if the pens come off? Does not fade after the first wash? Where to download the application? Since the store is so popular, there are often dozens and hundreds of questions and answers. As a result, many Americans go for product information not to the manufacturer’s website or to Wikipedia, but directly to Amazon.
4. Lowest prices
The fact that goods on Amazon have the lowest cost is not an exaggeration and not an accident. For this, there is a special algorithm. He monitors and adjusts prices, always offering the client as cheap an option as possible (given, of course, positive ratings and reviews). As we have many CEO-shniki trying to guess the algorithms of "Yandex", so in the US, sellers are trying to adapt to the algorithms of "Amazon" - so that their goods were one of the first in the search field. According to the Wall Street Journal, there are whole automatic price optimization services, “reprayers.” They regularly change the prices of goods, so that they like the "Amazon". The systems there are so complex that WSJ journalists compared them to trading on the stock market. And the result is always the best prices for buyers.
The result - the profit of the store is growing already reaching $ 38 billion per year. The number of customers is growing, the site is visited annually by 150 million people per month in America alone. And by the end of 2018, the store is going to capture at least 55% of all online sales in the United States.
Amazon is a very rich company. In the financial indicators for the third quarter, its sales grew by 34% to $ 44 billion. More than 80 million Americans pay companies $ 99 annually to get the benefits of Amazon Prime . This is $ 8 billion on subscriptions alone - one and a half times more than the cable network of HBO with its “Game of Thrones” and other hits. The Amazon Prime Day, which was held this year in July, was almost overshadowed by Black Friday. In one day, over 100 thousand television sets and about 3 million toys were sold. And IT services Amazon Web Services for the last quarter grew by 42% and brought $ 4.6 billion.Jeff Bezos with his wife
Despite revenue growth, Amazon continues to be not the most profitable company. Net profit in the last quarter fell by 40% to $ 350 million. Jeff Bezos invests all his money in further development, and in ten directions at once. Trying to bypass competitors in online sales and in web services, and even in streaming video, where Prime Video promises to bypass Netflix in views already in 2018. Amazon’s investments have quadrupled since last year, and the number of employees in the company has doubled (or tripled!) For many years in a row. If in 2011, 30 thousand people worked on Bezos, then in 2016 it is already 180 thousand, and now it is about 550 thousand (partly thanks to the purchase of Whole Foods). And this company also employs an additional several hundred thousand employees to clear up orders for Black Friday and New Year.
After reporting on the company's financial status at the end of October, Amazon shares rose another 7%. The stock price for the first time in history exceeded $ 1,100, and Bezos became the richest man in the world for the second time, ahead of Bill Gates. And although Apple is still more expensive, Amazon believes that $ 1 trillion is just around the corner, and it has every chance of becoming the first company in the world to cross this mark before 2020.
What do you think, does Amazon deserve the respect with which US residents belong to the company?
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