Pocket: Deconstructing Amazon Prime: Loss Leader or Value Creator?

Tbh, this is the logic organisations should run to anyway – a focus first on value creation, with value capture the second question. Even without the time horizon of Amazon, you need to create value before you capture it. This means a deep focus on your consumers and building things they love. It’s feels obvious, but it’s a lot rarer than it should be…

I have long described Amazon as a Field of Dreams company, one that goes for higher revenues first and then thinks about ways of converting those revenues into profits; if you build it, they will come. In coining this description, I am not being derisive but arguing that the market’s willingness to be patient with the company is largely a the result of the consistency with Jeff Bezos has told the same story for the company, since 1997, and acted in accordance with it. Amazon Prime symbolizes how Amazon plays the long game, an investment that has taken a decade to bear fruit, but one that will be the foundation on which Amazon launches into new businesses. I know that there are many companies that model themselves after Amazon, but unless these “Amazon Wannabes” can match its narrative consistency and long time horizon, it will remain a one of a kind.

Source: Pocket: Deconstructing Amazon Prime: Loss Leader or Value Creator?

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