Watch Out, Amazon's Jeff Bezos Is Here To Stay Long

by Sohini Bagchi    Jul 28, 2017

bezos

Hours before Amazon’s Q2 earnings call, Jeff Bezos reportedly surpassed Bill Gates as the richest person in the world. On Thursday Amazon’s stock slipped, in response to the company’s earnings report miss and Bezos soon lost his top spot naturally to Bill Gates. But the short-term fluctuations hardly matter for Bezos, whose net worth as the Amazon CEO is fantastic, and Becoz is here to play to long game, believe experts. And it is here for everyone to see as Bezos is remaking the world with its business acumen and operational prowess.

There are a number of things Amazon has taken in its strides, where his rivals falter. The 2017 Walker Sands Future of Retail study found 84% of US consumers have made a purchase on Amazon in the past year, and 55% are Prime subscribers. Consumers are increasingly using other Amazon offerings too, like voice devices (16%), grocery (14% - Pantry, 10% - Fresh) and Dash buttons (5%).

Also Millennials love Amazon. According to Yes Lifecycle Marketing’s report “A Marketer’s Guide to Reaching Each Consumer Generation,” nearly four in five (79%) millennials have purchased from Amazon in the past month, and 55% shop at Amazon for the Prime benefits — more than any other generation, 

Experts believe, retailers and brands are forced to sell on Amazon to survive. Igor Gorin, CEO of Astound Commerce, thinks that part of Amazon’s rise can be attributed to its ability to put pressure on retailers, who can’t afford to stay off the platform: “Amazon can be seen as a wolf in sheep’s clothing, as the company is an online behemoth with more and more direct product lines and its own private label brands. While retailers cannot afford not to be on Amazon, they must be mindful about Amazon terms and conditions, as placing products on the Amazon marketplace could translate into Amazon having access to the customer and product data.”

Read more: How Amazon, Flipkart Changed E-Shopping 

The other true spirit of Amazon is that it offers an unmatched digital experience. “Amazon’s differentiators - shipping price, fast website speed and easy browsing experience - are all key factors that influence consumers’ purchasing decisions. As Amazon continues to take over the retail space and e-commerce becomes the primary focus of most brands, small and mid-sized retailers must update their strategies to remain competitive,” said Justin Anovick, VP of Product at Episerver in a statement.

This year’s Prime Day was Amazon’s third and largest to date, according the creleased on Thursday. The company claims that it was the “the biggest global shopping event ever for Amazon” and that it set an internal record for single-day Prime signups. The sale moved more than 40 million units and created a customer fan base. 
 
“Amazon’s major draw for consumers is its convenience — so much so that many of them cite this as the top factor in shopping there. But price can also be a strong driver of customer loyalty, and Amazon is smart to provide an added incentive in offering major deals and discounts to its Prime members on Prime Day. What’s more, offering exclusive deals and early access to promotions plays into what the modern consumer wants from their status as a loyalty program member: priority, personalized offers and early access to benefits,” mentioned Pamela Sullins, VP of Retail Client Services, at Kobie Marketing.
 

Experts believe, there’s more to come in the future for both Amazon and Bezos. The unique trait of Bezos is that he famously doesn’t care what Wall Street thinks. For example, Bezos never joins the earnings calls. It serves as a symbol of his determined customer-first attitude, believe many.  And now, Bezos almost joined this exclusive billionaire club [albeit briefly], as Amazon stock continues to soar. 

Amazon’s defining modus operandi has always been to re-invest heavily. Amazon has continued to bust into new areas like voice recognition with Alexa, video streaming with Twitch — and now physical retail operations with Whole Foods. AWS is also carrying the lion’s share of the load here as it posted an operating income of $916 million — up from $718 million in the second quarter a year ago.

While Google and Microsoft continue to challenge Amazon in this area, AWS is largely synonymous with the rise of cloud computing. The challenge is now to keep up with the demands of startups and companies around the world.

The company’s shares have seen a meteoric rise this year, as high as 40 percent since the beginning of the year. That huge rise led to Bezos overtaking Bill Gates as the richest person in the world. That’s a big deal, as Bill Gates has held the title for 18 of the past 23 years, and as Pension Partners director of research Charlie Bilello noted on Twitter that Thursday marked Amazon’s eighth straight quarter of revenue growth exceeding 20 percent.

For Amazon, Q2 despite some criticism was a fairly successful one. According to the earnings report, operating cash flow increased 37 percent to $17.9 billion while net sales increased 25 percent to $38.0 billion and a a net income of $197 million. Experts believe, if Amazon keeps on like this, it may not be long for hin to knock Blii Gates from his perch sooner or later [as he did for a brief while] We need to wait and watch out the space.