Amazon started as an online bookstore in 1994 and has since become a major shopping portal. Its success was driven by customer reviews and recommendations. The company went public in 1997 and has since expanded through strategic partnerships and an affiliate program. By 2008, Amazon had generated over $19 billion in sales and earned a profit of approximately $645 million.
Amazon® is one of the largest online retailers in the world. The company started with the idea of selling books over the internet and has since expanded and evolved into a major shopping portal where customers can purchase products from a wide variety of brands and small independent retailers. The company’s websites around the world are now the first stop for many customers looking to purchase products over the Internet.
Amazon® was founded by Jeff Bezos in Bellevue, Washington in 1994 as a way to sell books to consumers online. It was launched in 1995 and in its first month it sold books in the United States and about 40 countries around the world. Within months of its launch, Amazon® was consistently selling around 100 books a day online.
Amazon®’s early success attracted investors who believed in the potential of the fledgling business. This capital infusion has allowed the company to improve and enhance its website and hosting capabilities, which in turn has helped the company grow. It has often been said that in the early days of the company, the website was rather basic, not very user friendly, and the overall look and feel of the site has led some customers to have a negative impression of the company. The improvements created the desired effect, and the company achieved nearly $16 million US dollars (USD) in sales in 1997.
Another driver of the company’s success was the sense customers had of belonging to an online community. Customers were able to post reviews of books they had purchased and read other customers’ reviews. The introduction of a recommended book was another major improvement to the site. The website displayed books that matched titles customers had recently purchased or viewed. Over time, this feature would expand to offer recommendations based on what other customers had purchased.
The company became one of the leading symbols of what became known as the “Dot Com Boom” of the late 1990s, and in 1997, Amazon® went public and sold nearly three million shares of its common stock. Yet despite successful sales, the company had not turned a profit and by early 2001 had posted net losses of more than $1 billion. This prompted a restructuring and revamp of the company’s operations, including forging strategic partnerships with major retailers and selling their products through Amazon®.com. The company has also started an affiliate program where businesses can place a link on their websites to Amazon®.com and receive a percentage of the sales generated through the link.
The changes had the desired effect, and by the end of 2001, Amazon® was making a $5 million dollar profit. By 2008 Amazon® generated sales of over $19 billion and earned a profit of approximately $645 million. From its humble beginnings in the home of founder Jeff Bezos to becoming one of the largest online shopping sites in the world, it’s clear that Amazon® has certainly come a long way.
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