PIONEERING E-COMMERCE INNOVATION AT AMAZON
Amazon has changed the way we shop. It disrupted the retail industry through technological innovation. Its business ecosystem and platform model contributed to its phenomenal increase in market value, from about $500 million in 1997 to over $450 billion today.
The company has provided the world with the most extraordinary example of business success and wealth creation in the shortest period of time. And in Amazon’s early days, I’d like to think that I played a part in that success.
The decisions I made when I joined the company in the late 1990s were taken as a co-owner. And I’m still one. Amazon used employee stock options to give staff an incentive to behave in ways that would boost the company’s stock price.
I headed the editorial team for Amazon’s books division in the UK. My task was to speed up revenue growth, acquire new customers, and gain a larger share of the book market. This was achieved by introducing new technologies, building relationships with high-profile authors, and closely matching inventory and price promotion.
Path to personalisation
Amazon’s innovation weren’t restricted to its sales channel. Digital transformation extended to supply chain management, finance and warehousing, each contributing to the blueprint for thinking beyond a single industry. Amazon’s diversification now includes consumer electronics, cloud computing, and video production and streaming.
As one of the world’s most customer-centric businesses, it’s no surprise that Amazon pioneered personalisation - the ability to match products with consumer interest or need. The way in which I helped implement the personalisation programme at Amazon is described below.
A brand for a company is like a reputation for a person. You earn reputation by trying to do hard things well.
- Jeff Bezos
Much of the content on Amazon was curated by a team of editors, a task that was time-consuming and expensive. A more cost-effective method of presenting content was required, which would provide users with even better recommendations than they were receiving.
Personalisation software was developed, which individualised recommendations based on what items users had bought in the past, had in their virtual shopping cart, had rated and liked, and what other customers had viewed and purchased.
I managed the implementation of the software for the books division with a team of eight editors. A perfect balance of curation and automation was determined for all genres. As the role of editors was changing, substantial change management formed part of the implementation process.
While the cost of presenting content dropped dramatically, there was also a significant increase in conversion. Personalised recommendations led to an increase in sales, securing Amazon’s position as the world’s top online retail site.