Scourge of the High Street? How a simple online book seller transformed itself into global e-commerce and tech giant
Amazon is so firmly established in people’s lives that it’s difficult to remember a time without it. It has become synonymous with online retail ever since it was founded on 5 July 1994 and launched on 16 July 1995.
the firm was created by Jeff Bezos (who still remains as CEO), after he left his job at a Wall Street firm and moved to the other side of the United States to Seattle.
Like all great start-ups, Amazon began life in the garage of Bezos, where it initially sold very old technology, namely paper-based books.
And it should be noted that Amazon was not actually called Amazon back then.
When Bezos created the company in 1994, he initially called it Cadabra. But months later he changed the name to Amazon.com after a lawyer reportedly misheard its original name as ‘cadaver’.
Bezos had chosen the name Amazon as it sounded exotic, and he noted that the Amazon river was the biggest river in the world. He intended to make Amazon.com the biggest online retailer in the world, in a time when the Internet was only slowly starting to gain traction worldwide.
Amazon.com officially went online in 1995, and although it initially only sold books, it now sells a huge range of products including DVDs, Blu-rays, electronics, clothing, furniture, toys, and even food.
“Jeff didn’t start Amazon as a book shop, but because he was fascinated by the Internet,” Amazon CTO Werner Vogels sad last year.
“You could have all the books in the world in one shop! But now, all these things are normal. My daughters are in their late 20s and don’t know a world without Amazon,” he said, pointing out that all the things that made Amazon’s retail platform, such as its warehouses and self-service, so effective were actually technological innovations suited for a particular application – online shopping.
“Amazon is a tech company, we just happen to do retail… really well,” he said. “We reinvented retail. Nobody wanted to read eBooks on their laptop so we invented a device. You have to invent yourself into this market. Sometimes these inventions take a while to settle but the Kindle and AWS [did].”
Amazon of course is now the largest Internet-based retailer in the world by total sales and market capitalisation. It is also the fourth most valuable public company in the world and the eighth largest employer in the United States.
It operates separate retail websites for the United States, the United Kingdom and Ireland, France, Canada, Germany, Italy, Spain, Netherlands, Australia, Brazil, Japan, China, India, and Mexico and at the start of 2016, its US website was attracting over 130 million customers per month.
When he started the firm, Bezos had frustrated shareholders as his business plan revealed he did not expect Amazon to make a profit within its first five years of trading.
Indeed, Amazon did not officially make a profit until late 2001, by which time it had survived the bursting of the dot.com bubble in 2000, as well as a number of lawsuits from firms such as Barnes and Noble (booksellers) and Walmart (big US retailer).