The big data point from Jeff Bezos latest annual shareholder letter that’s got everyone talking is the fact that Amazon Prime now has a staggering 100 million subscribers, which is further proof of just how powerful the online retail giant has become.
But in honor of his 20th annual shareholder letter, Bezos decided to also post the first shareholder letter he ever wrote in 1997, which is an awesome trip down memory lane to a time when the internet was just starting to pick up steam – and Amazon was not yet the world-conquering behemoth it is today.
So let’s look at some of the highlights from that modest letter from 20 years ago.
- Total Customers Amazon today has 100 million customers subscribed to its Prime service alone. In 1997 Amazon had 1.5 million customers total.
- Total Employees In 1997 Amazon saw its total employee base increase from 158 to 614. In 2017 Amazon had more than 560,000 employees working across the globe.
- Total Revenue In 1997 Amazon increased its revenue 838% to $147.8 million. In 2017 Amazon’s total revenue rose 31% year-over-year to $177.9 billion.
In his 1997 letter Bezos put the online retail market into perspective, which was still in its nascent days. He noted that Amazon was about to face competition from “larger players” who would soon be going online and putting increased resources into e-commerce.
But this is Day 1 for the Internet and, if we execute well, for Amazon.com. Today, online commerce saves customers money and precious time. Tomorrow, through personalization, online commerce will accelerate the very process of discovery. Amazon.com uses the Internet to create real value for its customers and, by doing so, hopes to create an enduring franchise, even in established and large markets.
We have a window of opportunity as larger players marshal the resources to pursue the online opportunity and as customers, new to purchasing online, are receptive to forming new relationships. The competitive landscape has continued to evolve at a fast pace. Many large players have moved online with credible offerings and have devoted substantial energy and resources to building awareness, traffic, and sales. Our goal is to move quickly to solidify and extend our current position while we begin to pursue the online commerce opportunities in other areas. We see substantial opportunity in the large markets we are targeting. This strategy is not without risk: it requires serious investment and crisp execution against established franchise leaders.
This being the ’90s, when people still referred to the internet as the World Wide Web, Bezos noted that Amazon “realized that the Web was, and still is, the World Wide Wait.” What Amazon set out to do, according to Bezos, was to bring customers “much more selection than was possible in a physical store (our store would now occupy 6 football fields), and presented it in a useful, easy-to-search, and easy-to-browse format in a store open 365 days a year, 24 hours a day.”
And in 1997 Amazon introduced the feature that would prove to be the ultimate game changer for e-commerce, for retail and for Bezos’ fortunes: 1-Click shopping.
Bezos, who founded Amazon in 1994 as a vehicle for selling his books, still referred to the company as a bookseller in 1997. “[A]s we’ve long said, online bookselling, and online commerce in general, should prove to be a very large market, and it’s likely that a number of companies will see significant benefit,” Bezos wrote.
But Bezos also saw that Amazon’s future was going to extend far beyond books: “We are planning to add music to our product offering, and over time we believe that other products may be prudent investments,” Bezos wrote. “We also believe there are significant opportunities to better serve our customers overseas, such as reducing delivery times and better tailoring the customer experience. To be certain, a big part of the challenge for us will lie not in finding new ways to expand our business, but in prioritizing our investments”
Photo: Amazon