Bezos Unbound: Exclusive Interview With The Amazon Founder On What He Plans To Conquer Next
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September 19 2018

Commentary by Eoin Treacy

Bezos Unbound: Exclusive Interview With The Amazon Founder On What He Plans To Conquer Next

This article by Randall Lane for may be of interest to subscribers. Here is a section:

Nevertheless, during the morning he spent with Forbes outlining how he channels innovation and chooses where to expand, a road map for Amazon's future emerged. Given Amazon's size, it moves both vertically and horizontally, each direction portending a lot more disruption. Even five years ago, Bezos seemed content merely to try to sell everything to everybody, becoming the bane mostly of retailers and wholesalers. But this master innovation artist now has the ultimate palette: any industry he chooses.

For this unconstrained era, the most important word at Amazon is yes. Bezos explains, correctly, the traditional corporate hierarchy: "Let's say a junior executive comes up with a new idea that they want to try. They have to convince their boss, their boss's boss, their boss's boss's boss and so on—any 'no' in that chain can kill the whole idea." That's why nimble startups so easily slaughter hidebound dinosaurs: Even if 19 venture capitalists say no, it just takes a 20th to say yes to get a disruptive idea into business.

Accordingly, Bezos has structured Amazon around what he calls "multiple paths to yes," particularly regarding "two-way doors": decisions that are often based on incremental improvements and can be reversed if they prove unwise. Hundreds of executives can green-light an idea, which employees can shop around internally. "He knows and we know that you can't invent or experiment without some failure," says Jeff Wilke, the long-time Bezos lieutenant who runs Amazon's consumer and retail operations. "Those we sort of celebrate. In fact, we want them to occur all over the place. Jeff doesn't need to review those. I don't need to review those."

Eoin Treacy's view

The bigger Amazon gets and the more industries it disrupts the greater the potential there is for antitrust advocates to gain traction. Amazon currently accounts for about half of all ecommerce traffic in the USA so it is no exaggeration to state that if you are not selling on Amazon you are leaving half the population untapped. That position lends the company enormous power and the EU is currently investigating how much advantage it gets from knowing product segments its third-party sellers are succeeding in.

Meanwhile news today that it intends to open 3000 cashierless stores by 2021 represents a significant upscaling of its test facilities from last year and represents significant spend in terms of rents. 

The bigger picture is there is still a large number of industries in the USA that are ripe for disruption from insurance to healthcare and from pharmaceuticals to car sales. Whether it is Amazon that succeeds in that disruption or not, they will eventually be rationalised because the essence of capitalism is market inefficiencies are eventually ironed out.

Amazon has posted a series of small ranges, one above another, since April. It is currently testing the lower side of the most recent, and will need to hold the $1900 level if this portion of the uptrend is to be sustained. A break in this sequence would likely signal a reversion towards the mean is underway.

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