This link has been bookmarked by 72 people . It was first bookmarked on 15 May 2017, by someone privately.
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24 Jul 17
William GunnRT @rschon: "Amazon has replaced...bureaucracy...with a feedback loop that generates cash [or] identifies problems" https://t.co/H8gYjrvr7u
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12 Jul 17
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10 Jul 17
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08 Jun 17
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02 Jun 17
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01 Jun 17
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29 May 17
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each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition
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each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition.
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each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition
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22 May 17
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I co-founded a software startup in December. Each month, I send out an update to our investors to keep them updated on our progress. But the past month was a bit different — our industry (retail) is going through a transformation.
Instead of just writing about our “internal” news, I wrote about the impending apocalypse in the broader world of retail. More specifically, I included some thoughts on Amazon and why their commanding lead is only going to get larger. Amazon is the most impressive company on earth, and I think it is one of the least understood. A few people suggested that I post this publicly, so here goes.
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The reason isn’t the bullet-point moats that are talked about in headlines, and it isn’t the culture of innovation or Bezos’s vision as CEO (though I do think Amazon’s culture is incredible and Bezos is the most impressive CEO out there). It’s the fact that each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition.
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In the 10+ years since AWS’s debut, Amazon has been systematically rebuilding each of its internal tools as an externally consumable service. A recent example is AWS’s Amazon Connect — a self-service, cloud-based contact center platform that is based on the same technology used in Amazon’s own call centers. Again, the “extra revenue” here is great — but the real value is in honing Amazon’s internal tools.
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The key advantage that Amazon has over any other enterprise service provider — from UPS and FedEx to Rackspace — is that they are forced to use their own services. UPS is a step removed from backlash due to lost/destroyed packages, shipping delays, terrible software and poor holiday capacity planning. Angry customers blame the retailer, and the retailer screams at UPS in turn. When Amazon is the service provider, they’re permanently dogfooding. There is nowhere for poor performance to hide. Amazon has built a feedback loop as a moat, and it is incredible to watch the flywheel start to pick up speed.
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Amazon is externally exposing the tools it uses to set its own prices in order to guarantee that the price listed on Amazon is as low as possible for the customer. This has spawned a whole ecosystem of third-party price-optimization tools called “repricers,” which use the MWS API to automatically respond to price changes in order to maximize sales for the Marketplace seller (the WSJ published a great piece on this back in March, aptly likening it to high-frequency trading). The beauty here is that Amazon doesn’t care if a seller undercuts Amazon’s price — Amazon takes a 12-15 percent commission on the sale regardless, and then collects FBA fees to boot.
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So, my opinion is that Amazon is uncatchable. It took Amazon 10 years to perfect FBA. Even if Walmart could do it in 5, where will Amazon be by the time they roll it out? And I haven’t even begun to touch the surface of Amazon’s lesser-known, industry-shattering programs like Seller Fulfilled Prime and Direct Fulfillment. I’m not sure we’ll see a mass-market retailer compete successfully against Amazon within my lifetime — though I still think there is a substantial opportunity for vertical-specific retailers like Chewy.com to spin up and gain some ground in the short term.
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21 May 17
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20 May 17
Larry SchmittKey insight - Amazon is opening up every aspect of their business as a platform that others can use and is therefore required to compete in the open market for these services. This provides Amazon an insurmountable, lasting advantage.
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each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition.
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While there are usually some compelling cost savings to be had from vertical integration (either through insourcing services or acquiring suppliers/customers), the increased margins typically evaporate over time as the “supplier” gets complacent with a captive, internal “customer.”
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By carving out an operational piece of the company as a platform, they could future-proof the company against inefficiency and technological stagnation.
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In the 10+ years since AWS’s debut, Amazon has been systematically rebuilding each of its internal tools as an externally consumable service
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mazon has replaced useless, time-intensive bureaucracy like internal surveys and audits with a feedback loop that generates cash when it works — and quickly identifies problems when it doesn’t.
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we all know about AWS. The incredible thing here is that this strategy — in one of the most herculean displays of effort in the history of the modern corporation — has permeated Amazon at every level
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The key advantage that Amazon has over any other enterprise service provider — from UPS and FedEx to Rackspace — is that they are forced to use their own services.
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When Amazon is the service provider, they’re permanently dogfooding. There is nowhere for poor performance to hide. Amazon has built a feedback loop as a moat, and it is incredible to watch the flywheel start to pick up speed
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Amazon is externally exposing the tools it uses to set its own prices in order to guarantee that the price listed on Amazon is as low as possible for the customer.
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19 May 17
Anarion DunedainI co-founded a software startup in December. Each month, I send out an update to our investors to keep them updated on our progress. But the past month was a bit different — our industry (retail) is going through a transformation. via Pocket
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dennisvdbAmazon opening their own tools to the public to check their efficiency, learn from it and improve and so create a competitive advantage over the other big retailers?
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17 May 17
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It’s the fact that each piece of Amazon is being built with a service-oriented architecture, and Amazon is using that architecture to successively turn every single piece of the company into a separate platform — and thus opening each piece to outside competition.
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Robert BestI co-founded a software startup in December. Each month, I send out an update to our investors to keep them updated on our progress. But the past month was a bit different — our industry (retail) is going through a transformation.
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16 May 17
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Vincent Murphy"Amazon is the most impressive company on earth, and... one of the least understood": https://t.co/Dxt6njtI3T
Why Amazon is eating the world https://t.co/a8m3UPnbGs via @Instapaper
2/ and Amazon is using that architecture to turn every single piece of the company into a separate platform https://t.co/QJb9Ze1gTq -
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By carving out an operational piece of the company as a platform, they could future-proof the company against inefficiency and technological stagnation.
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They say that money earned is a reasonable approximation of the value you’re creating for the world, and Amazon has figured out a way to measure its own value in dozens of previously invisible areas.
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it is this long tail of external service availability that I think will be nearly impossible to replicate
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When Amazon is the service provider, they’re permanently dogfooding. There is nowhere for poor performance to hide. Amazon has built a feedback loop as a moat, and it is incredible to watch the flywheel start to pick up speed.
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Amazon’s Marketplace Web Service (MWS) API — this is the set of services that Amazon Marketplace sellers can use to programmatically exchange data with Amazon. Amazon built out a service that they call the “Subscriptions API,” which gives the seller instant notification of any price change by any competitor — including Amazon itself!
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The beauty here is that Amazon doesn’t care if a seller undercuts Amazon’s price — Amazon takes a 12-15 percent commission on the sale regardless, and then collects FBA fees to boot.
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they are systemically productizing the entire company, honing what works, fixing what doesn’t and killing off everything else
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It’s impossible to imagine a future 10 years from now where a customer comes up and says, ‘Jeff I love Amazon; I just wish the prices were a little higher,’ [or] ‘I love Amazon; I just wish you’d deliver a little more slowly.’
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With Amazon Marketplace, sellers can list millions of the hottest new products far faster than Amazon’s Vendor team could ever hope to discover them.
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they’ve implemented a systemic solution that will maintain an unbeatable advantage over competitive retailers.
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15 May 17
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Beto BorbollaRT @damianburns: Excellent unpacking of Amazon's winning ways
https://t.co/8YZ4Ot66DC https://t.co/MMjuCLw0ix
@zedshaw Did you read this? https://t.co/lAqR371zni -
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by carving out an operational piece of the company as a platform, they could future-proof the company against inefficiency and technological stagnation.
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In the 10+ years since AWS’s debut, Amazon has been systematically rebuilding each of its internal tools as an externally-consumable service. A recent example is AWS’s Amazon Connect – a self-service, cloud-based contact center platform that is based on the same technology used in Amazon’s own call centers.
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They say that money earned is a reasonable approximation of the value you’re creating for the world,
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The level of discipline required to operate a multi-tenant, externally-facing service like FBA yields tremendous benefit to the Amazon’s internal operation
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The error rate had to be tremendous to start – I personally know of several sellers who have been reimbursed for tens of thousands of dollars in inventory that Amazon lost, no questions asked. Setting aside the massive technical challenges, what other retailer has the stomach to sustain such incredible losses in a program for so many years?
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The key advantage that Amazon has over any other enterprise service provider – from UPS and FedEx to Rackspace – is that they are forced to use their own services.
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“I very frequently get the question: ‘What’s going to change in the next 10 years?’ And that is a very interesting question; it’s a very common one. I almost never get the question: ‘What’s not going to change in the next 10 years?’ And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time. … [I]n our retail business, we know that customers want low prices, and I know that’s going to be true 10 years from now. They want fast delivery; they want vast selection. It’s impossible to imagine a future 10 years from now where a customer comes up and says, ‘Jeff I love Amazon; I just wish the prices were a little higher,’ [or] ‘I love Amazon; I just wish you’d deliver a little more slowly.’
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Fast delivery comes down to operational excellence and an exceptionally low cost of shipping, both of which are accomplished by opening FBA to external customers. I don’t think anyone understands The Innovator’s Dilemma better than Amazon, and they’ve implemented a systemic solution that will maintain an unbeatable advantage over competitive retailers.
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