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Jeff Bezos In 1999 On Amazon's Plans Before The Dotcom Crash - YouTube
Channel: CNBC
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It doesn't matter to
me whether we're a
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pure internet play. What
matters to me is
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do we provide
the best customer service.
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Internet Shminternet
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Given the decades of
wisdom that has built up
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in the business
world investors, it sounds
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like you're saying
you're making a big
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speculative bet, if
they're investing in
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your company's stock.
Well I think all
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Internet companies you
know the stocks are
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incredibly volatile...
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But even long term.
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Long term
I believe. That
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it's very easy to
predict that there are
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going to be
lots of successful companies
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born of the Internet.
They're going to have
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very large market caps
and so on. I also
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believe that today where
we sit it's very
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hard to predict
who those companies are
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going to be. So you
know you can make bets
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on these things and
I think that Amazon.com
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if we don't if
we're not one of those
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important lasting companies
born of the
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Internet we will have
nobody to blame but
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ourselves and we
will be extremely
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disappointed in ourselves.
But there are no
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guarantees. It's very
very hard to predict.
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If you go back
and look at the companies
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created by the P.C.
revolution in 1980 you
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wouldn't have predicted
the five winners the
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five biggest winners.
There've been lots of
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winners actually. So this
space is a little
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different and brand name
may need may mean
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more and then
there's some increasing
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returns kinds of things
maybe more. But I
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believe that if
you can focus obsessively
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enough on
customer experience, selection,
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ease of use, low
prices, more information to
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make purchase decisions
with. If you can
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give customers all
that plus great customer
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service and with our
toys and electronics we
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have a 30 day return
policy. If you can do
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all of that then I
think you have a good
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chance. And that's what
we're trying to do.
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You're not really
a pure Internet company
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anymore either. I
mean you've got millions
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of square feet now
of real estate. You've
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got a growing huge
and growing inventory of
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items with you keep
in stock. You've got
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thousands and thousands
of employees now.
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We have over 3000
employees and over four
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million square feet
of distribution center
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space. And those are
things I'm very very
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proud of because
with that distribution
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center space and
half a dozen distribution
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centers around the country
it allows us to
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get product close to
customers so that we
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can ship it to
customers in a very timely
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way which improves
customer service levels.
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That's what we're
about. If there's one
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thing Amazon.com is
about its obsessive
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attention to
the customer
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experience, End to
end. And that's what
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those
distribution centers.
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But you're not
a pure Internet play.
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It doesn't. It doesn't
matter to me whether
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we're a pure Internet
play it matters to me
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is we provide
the best customer service.
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Internet Shminternet. It's
that's you know
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that doesn't matter.
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Well but it does
matter to your investors to
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know whether they're
investing in a company
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that is...
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No, they should be
investing in a company
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that obsesses over
customer experience in
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the long term.
There is never any
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misalignment between
customer interests and
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shareholder interests.
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Well that's the
same argument that somebody
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at WalMart would
make as well.
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I don't see why not.
I think they should make
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that argument. So
it's a correct argument.
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OK.
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So you'll open as
many square feet of space
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physical space as you
have to hire as many
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employees as
you have to...
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To service customers.
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Absolutely. And we'll do
it as rapidly as we
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can.
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That's a very
cost intense proposition.
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Not compared to
opening an equivalent network
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of retail stores.
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So if you open a
bunch of chain stores. Look
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when we open
a distribution center we're
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opening places that may
have square where we
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may pay 30 cents a
square foot for for a
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lease instead of
paying seven dollars a
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square foot which you
might pay in a high
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traffic retail area.
So when you compare
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those things they're not
the same. You can't
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compare a big chain
of of of of retail
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stores to half
a dozen distribution centers.
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It's just not you
know it's bad math.
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Either way whichever side
of the argument you
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believe you're making what
it seems to me.
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There's only one side
which is obsess over
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customers.
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But it seems to me
that. Both with the speed
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of your growth in
terms of the number of
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stores online that
you're opening the
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different businesses you're
getting into the
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number of distribution
centers and you're
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opening a new
employees you're hiring
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That you are making
an intense gamble here
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which is twofold. One
that you can run this
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number of
businesses different businesses
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well. And two that
you can make money by
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selling vast volumes
of products and
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essentially razor
thin profit margins.
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I think that the
the first one in particular
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I agree with
wholeheartedly which is that
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where
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There there's no
guarantee that Amazon.com
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can be a
successful company. What we're
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trying to do
is very complicated. There's
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huge execution risk
involved. We have a
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terribly complicated
business. We're
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growing, you
know, historically very
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rapidly. We're
opening new product
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categories we're
expanding in new
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geographies. We have
whole new business
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models with things
like auctions. Now we
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think this is the
less risky of the two
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approaches because scale
is important in
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this business. And you
need scale also to
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offer the lowest
prices and the best
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customer service to
people. So scale is
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important to us and
we're going to go after
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that kind of scale.
But it does mean that
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the executional challenges
are huge. And so
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you'll find a bunch
of people back in
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Seattle and around
the world working very
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hard to make sure
we service customers at
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the level that they're
used to. And then
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even improving that.
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Isn't it to some
extent a certain amount
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of, with
all do respect,
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corporate arrogance to
assume that you can
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come into these businesses
which you have no
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experience in and
virtually overnight enter
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a huge variety
of different businesses and
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become the best in
those businesses and the
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market leader in
those businesses. There are
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other companies that
have been running these
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types of businesses for
decades if not more.
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I don't think so. So
you know when we first
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started selling books four
years ago we were
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everybody said look
you're just computer
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guys you don't
know anything about selling
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books. And that was
true. But what we really
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cared about customers and
now we know a lot
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about books and
when we first started
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selling music people said
the same thing but
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we hired the right
people. So we don't do
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this in a vacuum. We
go out and hire the
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best industry experts
in each of these
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categories. That's the
same with toys
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electronics. So you know
we take this very
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seriously we take
the commitment to the
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customer very seriously
and we're not about
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to release something
or announce something
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before it's ready.
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