The Amazon mission statement demonstrates the company’s commitment to delivering the best customer experience.
While that may seem simple, you only have to consider all the companies that fail to consider the customer across all their touchpoints and hence deliver a poor customer experience.
To put that into hard numbers, $1.6T is lost every year in the US because of poor customer service. (Source: Accenture Strategy).
Or reversing it around, the Temkin Group found that companies that earn $1 billion annually can expect to earn, on average, an additional $700 million within 3 years of investing in customer experience.
You can now understand how the relentless focus on customer experience has contributed to Amazon’s growth.
Quick Facts About Amazon
Interesting fact: Jeff Bezos originally wanted to call the company Cadabra, a shortened version of the magic term “abracadabra.” Fortunately, Jeff Bezos’ lawyer advised him that the name “cadabra” could be mistaken for “cadaver.” Eventually, they came up with the name Amazon, a reference to the river in South America. The idea they then came up with, Amazon the world’s largest river, was used because of the vast selection of books they would stock and sell. Despite this other domain names were purchased. If you type in Relentless.com, you will be redirected to Amazon.com.
|Annual revenue:||2019: $280.522 Billion|
|Profit | Net Income:||2019: $11.58 Billion|
|Market Cap:||(April, 2020): $952 Billion|
|Company CEO:||Jeff Bezos|
|Number of employees:||(FY 2019): 798,000|
|Type of business:||Public|
|Products And Services:||Amazon.com, Amazon Echo and Alexa, Amazon Kindle, Amazon Music, Audible, Amazon AWS, iMDb, Junglee, PillPack, Twitch, Whole Foods Market, Zappos.com|
What Is Amazon’s Mission Statement?
“to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online, and endeavors to offer its customers the lowest possible prices.”
The key points you can take from the Amazon mission statement are:
- customer-centric company
- find, discover and buy online
- lowest possible prices
At first glance this vision statement still seems like a good fit with Amazon’s core business, so why change?
Amazon’s core business is e-Commerce but as you can see from the Amazon business model it has, through acquisitions and innovations, expanded into a much broader set of services.
Despite this the majority of Amazons revenue still comes from the e-Commerce platform – Amazon.
How do we know that Amazon actually delivers on its promise of being customer-centric?
It’s one thing to talk about it but how and where can we find evidence that the Amazon mission statement is translated into reality.
One of the best reports is the Harris Poll which is conducted each year and ranks corporates on their reputation.
The Harris Poll shows that Amazon is number two out of over a hundred other companies.
Why the intense focus on customers?
“our customers are loyal to use right up until the second somebody offers them a better service. And I love that. It’s super-motivating for us”Jeff Bezos
The world doesn’t standstill. As soon as you have reached a point of delivering a new product or service someone else is working on something better.
Change is the new normal and change now happens quicker than ever before.
If you aren’t changing, adapting your capabilities, evolving to meet the needs of customers better than your competitors – then sadly you are at risk of becoming extinct.
Jeff Bezos understands this and has built this into the core philosophy that underpins Amazon.
Find, discover and buy online
Considering how many products Amazon lists it is easy to find what you want. That might seem obvious or you take it for granted, but Amazon has pioneered the online experience and others have simply followed and copied its standards.
You are always no more than two clicks away from buying. In addition, Amazon created and mastered the art of suggestions.
Amazon follows the patterns of your views, clicks and purchasing behaviour to make recommendations – the discovery part of the Amazon mission statement.
This same philosophy always cascades into other services such as Amazon Prime videos and Amazon music – placing the discovery centre stage.
Lowest possible prices
Amazon is able to offer low prices for two reasons:
- Cash flow – it has a good cash flow that means it gets paid before it pays suppliers.
- Buying power – Amazon because of the economies of scale it is able to command low prices from suppliers.
The New Amazon Mission Statement
What’s different about the new Amazon mission statement?
Amazon changed its mission statement to reflect its broader business partners and the widening set of services and products it now offers.
However, the overall Amazon vision statement remains the same:
“to be the Earth’s most customer-centric company”Source: Amazon
This focus on the is a core theme within the leadership skills of the Amazon board.
“Among the qualifications and skills of a candidate considered important by the Nominating and Corporate Governance Committee are: a commitment to representing the long-term interests of shareholders; customer experience skills; Internet savvy…”Source: Amazon Shareholder report 2020
The Core Focus Of Amazon
In the 2019 annual report, the following was highlighted under the section “consumers”.
“We serve consumers through our online and physical stores and focus on selection, price and convenience. We design our stores to enable hundreds of millions of unique products to be sold by us and by third parties across dozens of categories.Source: Amazon
Why The Customer Experience is Critical
Delivering the customer experience – end-to-end provides long-term value to customers, shareholders and creates a more sustainable business model.
Effectively, marketing leaders need to focus not just on customer acquisition, but the later stages of the customer experience – retention, renewal and customer insights.
By understanding your customers needs post-purchase and maintaining the customer relationship, companies can gain much deeper understanding and insights into their customer behaviours and needs. In turn, this provides the impetus for new products and services.
Amazon Four Principles
Amazon makes its mission and vision operational by translating these into its principles and values that guide the behaviours and attitudes of its employees and partners.
Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking. We are driven by the excitement of building technologies, inventing products, and providing services that change lives. We embrace new ways of doing things, make decisions quickly, and are not afraid to fail. We have the scope and capabilities of a large company, and the spirit and heart of a small one.Source: Amazon
- Customer Obsession.
- Invent and Simplify.
- Learn and Be Curious.
- Hire the Best.
- The Highest Standards.
- Think Big.
- Bias for Action.
- Earn Trust.
- Deliver Results.