The rise of empowered customers that is impacting not just retail but most other industries, isn’t going to slow down any time soon.
That’s the view of Jeff Bezos, who used used his annual letter to shareholders to highlight the company’s performance in 2017 and share how Amazon stays ahead of ever-rising customer expectations.
“You cannot rest on your laurels in this world. Customers won’t have it,” Bezos writes.
“One thing I love about customers is that they are divinely discontent. Their expectations are never static – they go up. It’s human nature. We didn’t ascend from our hunter-gatherer days by being satisfied. People have a voracious appetite for a better way, and yesterday’s ‘wow’ quickly becomes today’s ‘ordinary’. I see that cycle of improvement happening at a faster rate than ever before.”
So, how does Amazon stay ahead? A relentless focus on maintaining the highest standards for its customers.
“There’s no single way to do it – it’s a combination of many things. But high standards (widely deployed and at all levels of detail) are certainly a big part of it,” Bezos writes.
(You can read the full letter including Bezos’ detailed thoughts on bringing high standards organisation-wide here.)
A monster year for Prime
The letter also revealed that there are more than 100 million people around the globe who pay for a Prime membership. The number is significant because Prime members typically spend much more with the retailer than non-members in exchange for fast, free shipping and access to music and video services.
13 years after the subscription service was launched, Prime is now available in more than 50 cities across nine countries, and will be coming to Australia in the next few months.
2017 was the biggest year in Prime’s history, more members joined than in any previous year and more than five billion items were shipped worldwide. Part of that growth is thanks to Prime launching in new countries like Mexico, Singapore, the Netherlands, and Luxembourg.
Bezos wrote that Amazon has started the technical work to recognise Prime members at the checkouts and will be offering more Prime benefits to Whole Foods shoppers once that work is completed.
Other 2017 performance highlights include:
- Amazon Web Services achieved a $20 billion revenue run rate.
- For the first time more than half of the units sold on Amazon worldwide were from its third-party sellers.
- 2017 was Amazon’s best year yet for hardware sales and Alexa devices are some of the best selling items across all of Amazon.
- Alexa has enjoyed strong adoption from other companies and developers building skills for the devices, including 1,200 brands. Alexa is also getting faster at learning new languages, meaning Amazon’s voice-powered speakers can be launched more quickly in markets like Japan and India.
- As well as investing in original content, Prime Video acquired the video rights for more than 3,000 feature films in 2017.
- Amazon Music has “tens of millions” of paid customers, doubling its membership in six months and launching in 30 countries.