Companies like to talk about being on the “cutting edge” with their methodology, but only the successful entities actually put it into practice. Taking a general concept and turning it into tangible dollars is easier said than done. This is where Amazon has been at the forefront of their field, adapting a business model that places research at the top of the agenda.
The company has gone on to amass a staggering $280 billion in assets with CEO and founder Jeff Bezos becoming the wealthiest individual on the planet. What would begin as a modest online bookseller would quickly transition to a behemoth that caters to a myriad of services around the world. From videos and music to delivering home packages and everyday products, this e-commerce concept would spawn into an overarching enterprise that dominates the marketplace.
Amazon is an entity that has not escaped controversy or derision, yet they have understood the need to study the market, integrate new technologies and develop a model that will be attractive to all parties. That incorporates the customer and investor class. Through careful prudence and analytics, they have managed to go beyond the 100 million mark for unique subscribers as of 2018.
Customer research is where Amazon takes their mode of operations to the next level. Bezos has always been a figure who has been obsessed with this subject, wanting his specialists to dig deep into user behaviors. When a project like Amazon Local failed, it wasn’t a matter of cutting the losses and moving on but using surveys and customer feedback to shape how they maneuvered their resources and made investments for future creations.
Narrowing down the data for industry-specific products is where Amazon has developed an edge over the competition. They will breakdown each item in isolation rather than assessing the market in a generic sense. From audiobooks in the thriller section to portable vacuum cleaners and drones for business use, they will utilize their research capabilities with qualitative data that is narrowed down to the absolute minutia of their profile.
Working alongside accountants and monetary specialists in their field, Amazon will undertake a series of financial analytics to better understand how they can maximize their revenue streams. Especially when shipping such a vast array of stock from one location to the customer’s door, they have to assess tariffs, road tolls, staffing costs and the fluctuating price of goods for any given period.
It might not be a pretty part of the business, but Amazon will allocate time and resources to researching the competition. The likes of Google, Microsoft and IBM are comparable on a number of fronts and their expert team members will assess how they do business and whether or not those ventures enjoy cut-through with the community. Some will see this as an intrusive and aggressive stance, but it is simply a means for these giant multimedia enterprises to have their finger on the pulse, tapping into a practice that is well and truly uniform in the 21st century.
A brilliant strategy that allows Amazon to tap into this intellectual property and build a thriving research department is their desire to simply host their website for other sellers to promote their stock. While others were desperate to create their own content and run everything in-house, Amazon would quietly but astutely examine all of the data that dictates consumer movements, product popularity and anything else that the global marketplace would tell them about digital shoppers and their habits.
What defines the success of Amazon can be attributed to a range of factors. Some will put it down to sheer luck or fortunate timing coming out of the Seattle innovation bubble of the mid 1990s, but the evidence would suggest a more methodical approach that leverages research as an essential asset. It is the foundation that allows the brand to aggressively buy out successful start-ups and commercial ventures including IMDb and Twitch.
