,

The Everything Store: Book Review

Everything Store Jeff Bezos

The Everything Store: Jeff Bezos and the Age of Amazon by Brad Stone was this fortnight’s reading material for me.

Since one of Amazon’s central strategies is customer retention, I was fascinated to read about the inner workings of the business.

The business reinvests constantly to improve its offer to customers. Speed of delivery, range of goods on sale, quality of service, ease of interaction – all are under scrutiny for improvement. Jeff Bezos, founder and CEO of Amazon, believes that a ‘flywheel’ effect is generated when all of the above facets operate in unison. That flywheel in turn drives the business to even greater growth, allowing Amazon to sell more, more cheaply than competitors.

The Everything Store: Top 5 takeaways

Customer retention programs don’t have to be flashy

The Everything Store describes how Amazon minimizes cost at every opportunity. Even their desks are created by nailing doors onto trestle feet.

Bezos pushes this agenda from the top, believing that if it’s effortless and cheap to buy from Amazon, they will retain their customers for life. One thing that struck me again and again in this book, is that Amazon’s customer centric efforts are not flashy in any way. It’s not about offering perks or shiny gifts to keep customers. It’s about a relentless focus on making it easy for customers to buy, and as cheap as possible when they do. The experience is important, not because it’s luxurious but because it’s as effortless as possible.

Amazon focuses on customer need to guide it strategically, not the competition

Much like Steve Jobs, Jeff Bezos appears throughout the book to be utterly focused on what will keep customers happy, and make them buy more.

The one click ordering process, the free shipping, the personalization – all these Amazon initiatives came about because Bezos drives the company to consider the customer first. He says that whilst they don’t ignore what the competition does, they are not led by it either. They are led by the customer.

The business invests way ahead of time in customer retention strategies and technologies

Amazon was famous until very recently for not for having turned a profit. Every penny of the company’s revenue has been ploughed back into technology, pricing and customer initiatives. Even it’s much-vaunted drone delivery system comes from this same relentless focus on the customer. Bezos’ vision is incredibly long-term, something rare in our quarterly-driven worlds. There’s lots to admire here. You want to retain customers for a long time? You need to think long term.

Amazon sees its employee quality as having a huge bearing on customer retention

In the book The Everything Store, Brad Stone devotes a lot of time to Amazon’s employee recruitment program. He discusses how Amazon pursues the highest caliber staff, based on their SAT scores and all round smarts.

It’s made very clear in the book that Bezos does not tolerate bungled customer service, and the quality of Amazon’s people, and their ability to think clearly and build excellent customer programs is central to its success.

Teams no bigger than ‘2 pizzas’ are focused on Amazon’s biggest problems

Amazon has no time for layers of management. Bezos clearly believes that, when it comes to teams, small is beautiful. He is quoted as having said that bigger teams just add unnecessary cost and time to a project. Customer retention springs from a combination of technological superiority and customer service at Amazon, and so the faster they can get technical projects out, the better.

Teams are therefore allowed to be no bigger than 2 pizzas will feed on a late night project. This been seen as the blueprint for the lean processes Google and others in Silicon Valley ultimately followed.

The Everything Store: Top 5 Jeff Bezos quotes about customers and customer retention:

  • “If you want to get to the trust about what makes us different, it’s this. We are genuinely customer-centric, we are genuinely long-term oriented and we genuinely like to invent.” Jeff Bezos
  • “…[awards were given to] an employee who came up with a ‘well built idea that helps us to deliver lower prices to customers.'” Brad Stone
  • “Bezos believed that if Amazon.com had more user-generated book reviews than any other site, it would give the company a huge advantage; customers would be less inclined to go to other online bookstores.” Brad Stone
  • “Every time we hire someone, he or she should raise the bar for the next hire, so that the overall talent pool is always improving.” Jeff Bezos
  • “Bezos…felt expansion into new categories was urgent. In customers’ minds, the Amazon brand meant books only. He [Bezos] wanted it to be more malleable, like Richard Branson’s Virgin, which stood for everything from music to airlines to liquor.” Brad Stone

About the author

Lindsay Willott is CEO of Customer Thermometer, the microsurvey app. If you enjoyed this post, why not check out some of the others she’s written?

 

/by