Amazon.com
Webpages concerning "Amazon.com"
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Wikipedia-Article "Amazon.com"
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| Type | Public |
|---|---|
| Founded | 1995 |
| Location | Seattle, Washington |
| Key people | Jeffrey Bezos, President/CEO/Chairman Rick Dalzell, Senior VP/CIO |
| Industry | Retail |
| Products | Amazon.com A9.com Alexa Internet IMDb |
| Revenue |  $6.92 billion USD (2004) |
| Operating income | {{{operating_income}}} |
| Net income | {{{net_income}}} |
| Employees | 9,000 (2004) |
| Website | www.amazon.com |
| {{{footnotes}}} | |
Amazon.com, Inc. (NASDAQ: AMZN) is an American electronic commerce company based in Seattle, Washington. It was one of the first major companies to sell goods over the Internet. Amazon also owns Alexa Internet, a9.com, and the Internet Movie Database (IMDb).
Founded as Cadabra.com by Jeff Bezos in 1994 and launched in 1995, Amazon.com began as an online bookstore, though it soon diversified its product lines, adding DVDs, music CDs, computer software, video games, electronics, apparel, furniture, food, and more.
Amazon offers web services for access to its catalog as well as for integration with retailers like Target and Marks & Spencer. a9.com provides search engine services directly on the Amazon.com site.
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Business model
The company began as an online bookstore. Founder Bezos saw the potential of the Internet; while the largest brick-and-mortar bookstore might offer upwards of 200,000 titles, an online bookstore could sell many times more. Bezos renamed his company "Amazon" in reference to the world's most voluminous river, the Amazon. Amazon.com began service in July 1995. The company was originally incorporated in 1994 in the state of Washington and was reincorporated in 1996 in Delaware. Amazon.com had its initial public offering on May 15, 1997, trading on the NASDAQ stock exchange under the symbol AMZN at an IPO price of $18.00 per share (equivalent to $1.50 after three stock splits during the late 1990s).
Amazon's initial business plan was unusual, in that the company did not expect to turn a profit for four to five years after it was founded. In retrospect the strategy was sound, despite the dotcom collapse of 2000. Amazon grew at a steady pace in the late 1990s while other Internet companies appeared out of nowhere and grew at a blindingly fast pace. Amazon's "slow" growth caused a number of its stockholders to complain, saying that the company was not reaching profitability fast enough. When the Internet "bubble" burst and many e-companies began going out of business, Amazon persevered and finally turned its first-ever profit in the fourth quarter of 2002. It totaled a meager $5 million, just 1 cent per share, on revenues of over $1 billion, but it was important symbolically. It has since remained profitable and maintained revenues of over $1 billion per fiscal quarter. In January 2004 Amazon posted its first full-year net profit (for calendar year 2003). Its profits were $35.3 million on revenues of $5.65 billion. Much of the growth of the company was due to its international division.
Recognizing the website's success in popularizing online shopping, Time Magazine named Bezos its 1999 Man of the Year.
Partnerships and locations
Amazon.com operates retail websites not only for the United States, but also for Canada, the United Kingdom, Germany, Austria, France, China and Japan. In addition, the Web sites of Borders.com, Waldenbooks.com, Virginmega.com, Virginmega.co.jp, Waterstones.co.uk, CDNOW.com, and HMV.com now redirect to Amazon's site for the country in question, for which these companies are paid referral fees. Typing ToysRUs.com into one's browser will similarly bring up Amazon.com's Toys & Games tab. Amazon.com also operates retail Web sites for Target, the NBA, and Bombay Company.
Corporate headquarters
The company's headquarters are in Seattle, Washington (more specifically, Beacon Hill). It has additional offices in the International District, Rainier Valley, and Downtown's Columbia Center. Additional development centers are in Edinburgh, Scotland, Bangalore, India, Phoenix, Arizona, and Iaşi, Romania.
In Europe Amazon has sites in Germany, France and the UK with headquarters in Munich, Paris and Slough.
Fulfillment and warehousing
Fulfillment centers are located in the following cities, often near airports:
- North America:
- Phoenix, Arizona
- New Castle, Delaware
- Coffeyville, Kansas
- Kentucky: Campbellsville, Hebron (near CVG), and Lexington
- Nevada: Fernley and Red Rock (near 4SD)
- Pennsylvania: Chambersburg, Carlisle, and Lewisberry
- Dallas/Fort Worth, Texas
- Europe:
Customer service
Customer service for North American customers is handled by centers in Grand Forks, North Dakota and Huntington, West Virginia. In Europe, it is handled in Slough, U.K. and Regensburg, Germany. Amazon also has customer service centers in Japan and through Joyo.com, in China.
Expansion of product lines and site features
Amazon's bookstore quickly began expanding, branching off into retail sales of music CDs, videos and DVDs, software, consumer electronics, kitchen items, tools, lawn and garden items, toys, apparel, sporting goods, gourmet food, jewelry, watches, health and personal-care items, beauty products, musical instruments, and more.
A popular feature of Amazon is the ability for users to submit reviews to the web-page of each product. As part of their review users must rate the product on a scale from one to five stars. Since Amazon does not allow for a no star rating the star system can be interpreted as being on a zero to four rating.
According to information in the Amazon.com discussion forums, Amazon derives about 40% of its sales from affiliates, whom they call "Associates." An Associate is essentially an independent seller or business that receives a commission for referring customers to the Amazon.com site. Associates do this by placing links on their websites to the Amazon homepage or to specific products. If a referral results in a sale, the Associate receives a commission from Amazon. By the end of 2003, Amazon had signed up almost one million Associates. Associates can access the Amazon catalogue directly on their websites by using the Amazon Web Services (AWS) XML service. Amazon was the first online business to set up an Associates program. The idea has since been copied by many other online businesses.
Amazon bought the Internet Movie Database (IMDb) in April 1998, a move that upset a number of its longtime users; the transformation of IMDb from a public-domain, nonprofit site to a commercial venture was seen as a slap in the face to many Internet users. However, the IMDb has continued to grow and prosper.
Amazon bought Cambridge, Massachusetts-based PlanetAll in August 1998 for 800,000 shares of Amazon stock, then valued at approximately $88 million. PlanetAll operated a Web-based address book, calendar, and reminder service. Most of the staff at PlanetAll were absorbed by Amazon in early 1999. Many went on to build community-focused features for the Amazon Web site, including Friends & Favorites and Purchase Circles. The original PlanetAll Web site was discontinued on July 2, 2000.
In March 1999, Amazon launched Amazon.com Auctions, its foray into the Internet auctions space then dominated by eBay. Although Amazon's stock received a short-term boost from the announcement, Amazon's auction business failed to chip away at eBay's juggernaut growth. Much of the failure is owed to Amazon's inability to quickly integrate the fledgling auctions business into their existing successful retail space where Amazon's customer traffic was focused. Amazon Auctions was followed by the launch of a fixed-price marketplace business called zShops in September 1999, and a failed Sotheby's/Amazon partnership called sothebys.amazon.com in November. Although zShops failed to live up to its expectations, it laid the groundwork for the hugely successful Amazon Marketplace service launched in 2001 that let customers sell used books, CDs, DVDs, and other products alongside new items. Amazon Marketplace's main rivals today are eBay's half.com service, and BOSO (Buy Or Sell Online).
Amazon bought Alexa Internet, Accept.com, and Exchange.com in a set of deals worth approximately $645 million in June 1999.
In 2002, Amazon became the exclusive retailer for the much-hyped Segway Human Transporter. Bezos was an early supporter of the Segway before its details were made public.
Search Inside the Book is a feature which makes it possible for customers to search for keywords in the full text of many books in the catalog. The feature started out with 120,000 titles (or 33 million pages of text) on October 23, 2003. There are currently about 250,000 books in the program. Amazon has cooperated with around 130 publishers to allow users to perform these searches. To avoid copyright violations, Amazon.com does not return the computer-readable text of the book but rather a picture of the page containing the found excerpt, disables printing of the pages, and puts limits on the number of pages in a book a single user can access. Amazon is planning to launch Search Inside the Book internationally.
In 2004, Amazon purchased Joyo.com, a Chinese e-commerce Web site. It also debuted A9.com, a company focused on researching, and building innovative technology. One of the technologies A9.com was working on was a search engine with a "Search Inside the Book" feature allowing users to search within the text of books as well as searching for text on the Web. Another A9.com technology was its "Find It on the Block" feature allowing users to find not just the phone number, address, map, and directions for a business; but to see a picture of it, and all the businesses and shops on that same street.
Also in 2004, Amazon launched its "Presidential Candidates" feature, whereby customers could donate from $5 to $200 to the campaigns of U.S. presidential hopefuls, resurrecting the Amazon Honor System for the purpose. The Honor System was originally launched in 2001 as a way for Amazon customers to "tip" their "favorite Web sites and to buy digital content on the Web," Amazon collecting 2.9% of the payment plus a flat fee of 30 cents. It has never been shut down, but had fallen into relative disuse.
At the end of the year, with the catastrophic earthquake and tsunami in the Indian Ocean, Amazon set up an online donation channel to the American Red Cross using the Honor System, waiving its processing fee. As of January 3, 2005, over 162,000 individuals had donated over $13.1 million in this way. The same week, Amazon created similar channels for the British, Canadian, French, German and Japanese Red Cross organisations via its international sites. Over 7,000 Britons donated over $350,000; over 900 Canadians, over $56,000; over 660 French, over $23,000; over 2,900 Germans, over $145,000; and over 1,900 Japanese, over $66,000.
Amazon reactivated its Red Cross donation channel when Hurricane Katrina struck at the end of August, 2005. As of September 8, over 98,000 payments had been made totaling over $10.7 million.
Patent controversies
The company has been controversial for its use of patents as an alleged hindrance to competitors. The "one click patent" is perhaps the best-known example of this. Amazon's use of the one-click patent against competitor Barnes and Noble's website led the Free Software Foundation to announce a boycott on Amazon in December 1999 [1]. The boycott was discontinued in September 2002 [2].
On February 25, 2003, the company was granted a patent titled "Method and system for conducting a discussion relating to an item on Internet discussion boards."
Other controversies
Amazon.com has caused frustration among those wishing for more active customer support. Their little advertised customer service phone number in the US is 1-800-201-7575. It is hard to find because most help links on Amazon pages ask customers to send their questions via e-mail, omitting to disclose any of their contact phone numbers in their help pages. This has been a standard policy over the years, despite the numerous complaints of customers considering a person-to-person communication over the phone as a much more convenient support option, instead of an email that can take hours, or even days to be replied to, and has prompted others to create Web sites for the sole purpose of distributing the appropriate numbers. To understand the extent of customer dissatisfaction with this policy, it's worth noting that such a webpage with Amazon.com contact numbers received in excess of 23,000 visits in December 2004 alone.[3]
Anti-union activity
Saying that they were frustrated with low wages, lack of advancement opportunities, and poor treatment, Amazon.com workers at eight distribution centers sought to join the United Food and Commercial Workers (UFCW) in December 2000. Meanwhile, the Communications Workers of America undertook a campaign to unionize some 400 customer-service representatives in Seattle, where Amazon is based. Amazon.com management embarked on an aggressive anti-union campaign that included shutting down its Seattle service center. [4] [5]. Amazon.com suceeeded in stalling the unions' efforts, in part by appealing to workers' fear of finding jobs at the end of the dot com boom. Duane Stillwell, president of the Prewitt Organizing Fund, said: "It's unfortunate that this vaunted high-tech company is just saying the same crude things that factory owners have been saying for 100 years about unions. They're just scaring people out of wanting to do the right thing."
Critics allege that Amazon.com's business practices are similar to those of the retail chain Wal-Mart, in that Amazon.com offers low prices for goods by subsidizing its workers' pay and cutting profits to publishers and other suppliers.
Trivia
- Douglas Hofstadter's Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought was the first book sold by Amazon.com on July 15, 1995.
- Some of the words in Amazon.com URLs are nods to the Amazon River and Brazil: obidos comes from Óbidos, the meeting place of the Amazon's tributaries; varzea is Portuguese (Brazil's main language) for a forest flooded after heavy rains, as parts of the Amazon forest are; gp is short for Gurupa, a region in Brazil near the mouth of the Amazon.
- A 2002 glitch in Amazon.com's review system revealed that many well-established authors were anonymously giving themselves glowing reviews, with some revealed to be anonymously giving "rival" authors terrible reviews. The glitch in the system was fixed and those reviews have since been removed or made anonymous.
Further reading
- Robert Spector (2001). amazon.com--Get Big Fast: Inside the Revolutionary Business Model That Changed the World, Harper Collins Publishers. ISBN 0066620414.
- Mike Daisey (2002). 21 Dog Years, Free Press. ISBN 0743225805.
- Mara Friedman (2004). Amazon.com for Dummies, Wiley Publishing. ISBN 0764558404.
- James Marcus (2004). Amazonia: Five Years at the Epicenter of the Dot.Com Juggernaut, W.W. Norton. ISBN 1565848705.
- Steve Weber (2005). The Home-Based Bookstore, Weber Books. ISBN 0977240606.
See also
- Kimba Kano: Internet Explorer add-on, which adds built-in Amazon.com searching (formerly known as Coeus).
- Statistically Improbable Phrases: Amazon.com's phrase extraction technique for indexing books.
References
- Amazon.com discussion board patent, method and system for conducting a discussion relating to an item under United States Patent 6,525,747
- (Formerly) Boycott Amazon! Free Software Foundation suggestion of a boycott against Amazon.com between 2000 and 2002
External links
- Amazon.com (United States)
- Amazon.co.uk (United Kingdom)
- Amazon.ca (Canada)
Amazon.de (Germany)- Amazon.at (Austria)
Amazon.fr (France)- Amazon.co.jp (Japan)
- Joyo.com (Chinese: 卓越网) (China)
- Amazon.com company profile via Yahoo!
