🔗 Source: YouTube - Jeff Bezos Customer Obsession 1999
- Interview from July 13, 1999
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If there's one thing amazon.com is about its obsessive attention to the customer experience end-to-end and that's what those distributions centers are about.
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It doesn't matter to me whether we're a pure internet player. What matters to me is do we provide the best customer service. Internet shminternet, that doesn't matter.
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[Investors] should be investing in a company that obsesses over customer experience. In the long term there is never any misalignment between customer interests and shareholder interests.
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There's only one side, which is obsess over customers
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You know when we first started selling books four years ago, everybody said "look you're just computer guys you don't know anything about selling books" and that was true. But we but we really cared about customers and now we know a lot about books. And when we first started selling music people said the same thing but we hired the right people. So we don't do this in a vacuum. We go out and hire the best industry experts in each of these categories. That's the same with toys electronics so you know we take this very seriously. We take the commitment to the customer very seriously and we're not about to release something or announce something before it's [presumably ready, video cuts].
Bezos:
I believe that if you can focus obsessively enough on customer experience, selection, ease of use, low prices, more information to make purchase decisions with, if you can give customers all that, plus great customer service and with our toys and electronics we have a 30-day return policy, if you can do all of that, then I think you have a good chance and that's what we're trying to do.
Interviewer:
You're not really a pure Internet company anymore either are you. I mean you've got millions of square feet now of real estate you've got a growing, huge and growing, inventory of items, you've got thousands and thousands of employees
Bezos:
Yeah we have over 3,000 employees and over 4 million square feet of distribution center space and those are things I'm very very proud of because with that distribution center space and half a dozen distribution centers around the country, it allows us to get product close to customers so that we can ship it to customers in a very timely way which improves customer service levels. That's what we're about. If there's one thing amazon.com is about its obsessive attention to the customer experience end-to-end and that's what those distributions centers are about.
Interviewer:
But you're not a pure internet play
Bezos:
It doesn't matter to me whether we're a pure internet player. What matters to me is do we provide the best customer service. Internet shminternet, that doesn't matter.
Interviewer:
Well but it does matter to your investors to know whether they're investing in a company that ...
Bezos:
No they should be investing in a company that obsesses over customer experience. In the long term there is never any misalignment between customer interests and shareholder interests.
Interviewe:
Well that's the same argument that somebody at Walmart would make as well wouldn't it.
Bezos:
I don't see why not I think they should make that argument. It's a correct argument.
Interviewer:
Okay so you'll open as many square feet of space, physical spaces, you have to hire as many employees as you have to
Bezos:
to service customers absolutely and we'll do it as rapidly as we can.
Interviewer:
that's a very costs intense proposition
Bezos:
Not compared to opening an equivalent network of retail stores. So if you open a bunch of chain stores. Look when we open a distribution center we're opening places that may have squit you know we're we they pay 30 cents a square foot for a lease instead of paying seven dollars a square foot which you might pay in a high-traffic retail area. So when you compare those things they're not the same. You can't compare a big chain of retail stores to half a dozen distribution centers. It's just not you know it's bad math.
Interviewer:
Okay either way, whichever side of the argument you believe, you're making what it seems to me
Bezos:
There's only one side, which is obsess over customers
Interviewer:
but it seems to me, that both with the speed of your growth in terms of the number of stores online that you're opening, the different businesses you're getting into, the number of distribution centers and your opening and new employees your hiring that you are making an intense gamble here which is twofold: one that you can run this number of businesses different businesses well, and two that you can make money by selling vast volumes of products and essentially razor-thin profit margins.
Bezos:
I think that the the first one in particular I agree with wholeheartedly. Which is that, there's no guarantee that amazon.com can be a successful company. What we're trying to do is very complicated. There's huge execution risk involved. We have a terribly complicated business, we're growing you know historically very rapidly, we're opening new product categories we're expanding in new geographies, we have whole new business models with things like auctions. Now we think this is the less risky of the two approaches because scale is important in this business and you need scale also to offer the lowest prices and the best customer service to people. So scale is important to us and we're gonna go after that kind of scale. But it does mean that the executional challenges are huge. So you'll find a bunch of people back in Seattle and around the world working very hard to make sure we service customers at the level that they're used to and then even improving that>
Interviewer:
Isn't it to some extent certain amount of, with all due respect, corporate arrogance to assume that you can come into these businesses, which you have no experience in and virtually overnight enter a huge variety of different businesses and become the best in those businesses and the market leader in those businesses, and there's other companies that have been running these types of businesses for decades if not more.
Bezos:
I don't think so. You know when we first started selling books four years ago, everybody said "look you're just computer guys you don't know anything about selling books" and that was true. But we but we really cared about customers and now we know a lot about books. And when we first started selling music people said the same thing but we hired the right people. So we don't do this in a vacuum. We go out and hire the best industry experts in each of these categories. That's the same with toys electronics so you know we take this very seriously. We take the commitment to the customer very seriously and we're not about to release something or announce something before it's [presumably ready, video cuts].