How Amazon Controls E-commerce

When you think about ecommerce, you think about Amazon. But how did a company that started with online books come to dominate an estimated one third of ecommerce in the U.S.? In the 72 slides above, global consulting boutique faberNovel breaks down Amazon’s business and strategy. The keys to Amazon’s success are 1) the Internet imposes no limits on how much Amazon can sell; 2) its control of customer accounts and loyalty, and 3) and a growing ecosystem that is helping it cement its place in the world of digital goods as well.

It’s instructive to see how Amazon has expanded over the years and moved away from its reliance on books, music, and movies. You also forget that along the way, Amazon piled up $3 billion in losses between 1995 and 2003. Now it’s got $34 billion in annual revenue, and is spitting out $1 billion a year on profits. Who says you can’t spend your way to profitability?

The slides are a real deep dive into Amazon’s business model and future prospects. Every year faberNovel puts together one of these strategy presentations. In the past it’s analyzed Google(twice), and Apple.

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