Amazon just posted a record profit of $2.5 billion for the second quarter of the year, but for some who dialed in to the company's earnings call Thursday, even more interesting than Amazon's performance may have been its recent acquisition of PillPack.
Jeff Bezos's company acquired the online pharmacy, which ships personalized prescription drugs to customers' homes, for $1 billion. Amazon has been following an aggressive strategy of expansion and diversification for years, both by innovating and through more than 100 acquisitions and investments. During the earnings call, Amazon CFO Brian Olsavsky discussed what the company looks for in acquisitions.
"Recently, we're looking for well-run companies with highly differentiated customer experience, and a real sense of customer obsession that matches ours," Olsavsky said.
What does that mean? Here are three Amazon acquisitions that help explain.
Amazon announced in February that it would acquire smart doorbell maker Ring. What made it a well-run company? In five short years, founder (and inventor) Jamie Siminoff took the business from startup that couldn't get a deal on Shark Tank to company that modernized the doorbell, growing the business to 1,300 employees with 10 unique products sold in 1,600 stores.
Acquired by Amazon in 2009, the shoe and clothing e-commerce site led by Tony Hsieh was known for its "wow" customer service experience. One of the most extreme examples of its customer service going above and beyond came when an employee went to a rival store--in person--to buy shoes for a customer because Zappos had run out of stock.
In 2014, Amazon spent more than $1 billion to acquire gaming live-streaming platform Twitch, which allows spectators to watch others play video games via live stream. The business model might sound underwhelming, but customers are truly obsessed. At the time of its acquisition, Twitch had more than 60 million unique visitors per month.
There you have it. If you want Jeff Bezos to come knocking, make sure your business has the numbers and customer service to attract his interest.