Thursday, February 9

Virginia's State of Mind: The circle of life - Amazon's curious & cyclical business model

A company with a marketing team that
really likes the swoosh image on their
logo - which was used in the early 90's by
every company most notably by NIKE - Also they
are recreating the 'bookstore' idea invented
in 900 BC by Socrates & Friends

I was but a wee lass when the words "World Wide Web" began to be tossed about during everyday water-cooler banter. I was just a little older than that when every company, from a dry cleaner to a shopping superstore determined that a website was a successful business requirement.

Terms like "synergistic relationships," "strategic alliances" and "enterprise-wide collaboration" appeared in every PowerPoint presentation as companies scrambled to build a web page and define their online market presence. Simultaneously, consumers fell prey to innovative gadget advertising and the personal PC quickly became as pervasive as the household appliance.

It was in this environment of advanced technology expansion (I'm trying to get all of the buzz words in) that a few fresh-thinking risk-takers came up with a completely new business model called e-commerce (electronic commerce). The concept was simple: offer the same products available in stores — online. The traditional brick and mortar store business model would be totally eradicated. People could go on the Internet, purchase products and have them delivered overnight at an affordable price and never have to leave the comfort of their own home. It was revolutionary. For the first time, people were able to do all of their Christmas shopping at work while their boss assumed they were creating a PowerPoint presentation that included the words "stakeholder" and "analyses."
One of the most successful Internet-based stores was Originally, Amazon sold only books. The e-commerce idea swarmed the World Wide Web and Amazon's business (and stock) took off, catapulting them into an international online one-stop-shop retailer. Soon Amazon was selling everything from books to furniture.

However, the technology evolution didn't stop there. More fresh-thinking risk-takers at Amazon realized that along with the brick and mortar bookstore, even books could be eradicated. A completely new product called the e-reader was born. The concept was simple: offer a large number of books on one small hand-held device. The e-readers allowed consumers to read e-books on a device such as the Kindle or Nook. The e-readers were really helpful since it was hard to find "real" books because most of the brick and mortar bookstores had been eradicated. Amazon's proprietary product, the Kindle, solidified their e-commerce, e-reader spot in the online bookstore market.

Not surprisingly, more fresh-thinking risk-takers at Amazon have come up with an even more revolutionary idea. The concept is simple: offer the same products that are currently available for purchase online – in a store built out of brick and mortar. This evolutionary business model will allow customers to touch and feel products (and return them without a trip to the post office).

Amazon is planning to open its first market transforming, strategic store in Seattle. The store will showcase innovative products such as the Kindle e-reader. However, one of the most obvious business challenges is what to call this revolutionary concept. Perhaps "e-store to p-store" (electronic store to physical store) might work. Maybe a simple logo in the shape of a circle that has a tagline of "we've gone full circle" would be more effective? I suspect it's only a matter of time before more fresh-thinking risk takers at Amazon develop another revolutionary idea that will reshape the book market. The concept is simple: a brick and mortar bookstore that sells paper-based books and includes a small coffee shop.

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