Amazon’s Next Moves
It’s a Customer Ecosystem Poised to Become an Increasingly Important Part of Our Lives
Amazon is as important as Apple, Google, and Facebook in transforming how we get things done. In 2013, as Amazon introduces its own phones, you’ll have Amazon ease at your fingertips, not just for buying things and comparison shopping, but also to manage much of your life, including all of your digital assets. Moreover, Amazon’s customer-controllable recommendations will challenge Google and Facebook’s ads for relevance.
NETTING IT OUT
Amazon.com is already a customer experience phenomenon. Over the next couple of years, we predict that Amazon will play an even bigger role in most peoples’ lives than it does today.
Amazon and its entire ecosystem of suppliers, retailers, authors, developers, and businesses are well-aligned to continue to address customers’ needs for low-cost, convenient, access to goods, services, information, entertainment, and just-in-time computing.
In 2013, Amazon is likely to expand its offerings in two important dimensions: 1) selling targeted advertising and 2) delivering its own mobile phones to consumers.
Do we trust Jeff Bezos and the Amazon brand to help us manage more of our lives without bombarding us with intrusive ads? The short answer: yes!
Edit Your Purchase History to Improve Your Recommendations
Here’s my recent purchase history on Amazon. Note that I can tell Amazon that the Harry Potter movie I purchased was for my nieces to enjoy—it’s not something I wanted. And the bathtub bar wasn’t a gift, but, again, not something I am in need of. The rocket engine was both a gift and something I wouldn’t want to see recommendations based on.
WHY AMAZON WILL BECOME THE “NEXT BIG THING” IN 2013
It’s a Successful Customer Ecosystem
A year ago (January 2012) I greeted the New Year with an article1 describing a business model and business strategy that I have fallen in love with. I call this model: Customer Ecosystems.
Customer ecosystems are business networks that are aligned to help customers get things done.
I believe that one of the secrets behind Amazon’s success is that it is, in fact, a customer-centric ecosystem, with suppliers, partners, retailers, publishers, developers, and Amazon’s 65,600 employees aligned around helping customers get things done. Here’s how I described this business model in 2012:
“Customer ecosystems self-organize around things that customers care about and need to get done… Customer ecosystems act as magnets. The easier it is for customers to do things in and around your brand, the more they also value tools and resources from others that help them do everything they care about, including the things that aren’t in your sweet spot. Everyone benefits as customers achieve their goals, partners make money by providing what customers need at just the right time, and you all gain a much clearer picture of what’s going on and what new patterns and needs are emerging. …As the ecosystem designer, you want your brand and your ‘secret sauce’ to deliver the hallmark experience and the perceived value as the ecosystem grows and evolves.”
~ Patricia B. Seybold, Customers.com
What Makes Amazon a Successful Customer Ecosystem?
We tend to think of Amazon as a great resource for shopping. We can also think of Amazon as a supplier of on-demand infrastructure services (computing, digital storage, and e-commerce and fulfillment services). Yet, if you step back and look at all of the ways in which Amazon has subtly entered your life, you’ll begin to realize that it’s hard to live without.
For example, I always search Amazon first when I’m thinking of buying anything. I want to know what’s available, what the going prices are, and what people think of the various offerings. I also rely on Amazon to keep track of my most important contact information—the names, addresses, emails, and phone numbers of all my friends and family members. (When I lost my phone, Amazon was the first place I went to begin reconstructing my contact list.) It’s also where I manage the different payment mechanisms I use for different kinds of purchase—for both business and pleasure. And it’s where I redeem my American Express membership rewards.
I read most of my books using Amazon Kindle e-reader on my iPad, my Blackberry, my iPod Touch, and my old Kindle e-book. I love the way that Amazon synchs across all of these different platforms and devices—not just the Kindle reading application and the books themselves, but also the exact place I left off reading when I switch from reading using my iPad on my couch, to reading in the Doctor’s waiting room using my Blackberry.
I use Amazon Prime and Instant Videos on my TiVo-powered TV set and on my Apple iPad to watch the latest shows and movies.
And, although I currently keep my music library in iTunes with Apple’s Match service, I might switch my music library to Amazon’s at some point.
I am moving my business Web infrastructure to Amazon’s cloud, although we also use Gmail and Microsoft apps. We use many pay-as-you-go Amazon Web services, such as 37 Signal’s Basecamp to manage projects with our clients and Amazon’s S3 to store three decades worth of articles and images.
As an author, the bulk of my physical and digital books are sold through Amazon.com.
As a publisher, we publish our own e-books using Amazon’s tools.
Amazon provides a network of business resources that lets me do all of these things. It’s a customer-centric ecosystem because it helps me do the things in my life that are important to me and because my information is at its core. All of my information (past orders, digital books, videos, music, and everything I’ve stored in Amazon S3) is available to me to see, re-download, and re-use. All of my payment types, prime member benefits, and my address book are also readily available to view and edit. And, most important, it’s customer-centric precisely because I can see (and edit) the assumptions Amazon is making about the recommendations that it (or its partners) make to me about what I might like.
1) The Next Big Thing: Customer Ecosystems: Six Secrets for Designing Business Networks Aligned To Help Customers Get Things Done, by Patricia B. Seybold, January 12, 2012, http://dx.doi.org/10.1571/bp01-12-12cc
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