Since its founding in 1994, Amazon has gone from an online bookstore to an online everything store--and along the way, it has completely changed the way we do business on the internet. Amazon’s success comes down not only to its innovative sales and commerce strategies, but also to the mindset of Jeff Bezos, the company's founder, president, and CEO. Bezos’s approach to work and success have made Amazon’s meteoric rise possible.
1. Regret Nothing
Bezos founded Amazon after leaving a vice president position at investment firm D.E. Shaw & Co. It’s tough to leave behind a financially secure, high-powered post like that one. But Bezos claims that he tried to imagine himself decades in the future, looking back on his life: He wanted to be in a position where he would regret nothing. Jumping ship to start a new Web-based company at a moment when the internet’s future was still uncertain was a huge risk--but one Bezos knew he had to take it. "I knew that if I didn’t try this," he told Time magazine, "I would regret it. And that would be inescapable." Bezos calls this attitude his "regret minimization framework." Now that Amazon is one of the top companies in the world, it’s clear that Bezos’s risk-taking and regret-avoidance paid off!
2. Play the Long Game
In the early days of Amazon, Bezos warned investors that the company was years away from turning a profit. And this was on purpose: In 1997, he told Inc.: "We’re going to be unprofitable for a long time. And that’s our strategy." Bezos was playing the long game. The company was growing quickly in the late 1990s, developing new customer-service strategies and, as some argued, burning through cash. But Bezos’s willingness to put it all on the line paid off in 2003, when Amazon earned its first full-year profit. Bezos’s vision included recognizing that things wouldn’t always be easy, and that to become profitable, you have to work your way there--which involves envisioning and playing the long game.
3. Start Narrow, Then Diversify
Today, Amazon sells just about everything, from books and movies to clothing and groceries. And with Amazon Prime and Amazon Studios, it’s getting into the media production game. But Amazon started out selling one thing and one thing only: books. Book sales were Amazon’s proving ground. Bezos envisioned them as the first step towards creating the "everything store" that he envisioned. This strategy--starting with one specific product and building a strong e-commerce system around it before diversifying--let Bezos slowly turn Amazon into an e-commerce giant.
4. If You Want to Be Innovative, Prepare to Fail
Amazon is one of the world’s biggest retailers, and it has made online shopping a normal part of our everyday lives. But Bezos founded the company in 1994, when online commerce was new and its future uncertain. Bezos himself didn’t expect the company to succeed. In fact, he told Time that he had a warning for his first investors: "I think there’s a 70 percent chance you’re going to lose all your money, so don’t invest unless you can afford to lose it." It was only by taking a huge financial and career risk that Bezos was able to get Amazon off the ground. It goes to show that, if you want to be innovative, it means taking risks. As Bezos puts it "That’s actually a very liberating expectation, expecting to fail."
Luckily for Amazon, and for anyone who shops online, while Bezos expected to fail, his mindset led to unprecedented success.