Caution: Experiments in Progress – the Amazon Success Formula

You may have heard the political statement, “Throw enough mud at the wall and some of it will stick”. Amazon has its own business version of it, but with a good twist: “Experiment as much as you can and see what works.” And the company seems to thrive on that ideology.

Amazon’s desire to disrupt things is unparalleled, and the need to shake up the status quo keeps the company in a constant mode of experimentation. The AWS experiment was, by far, the biggest, boldest effort by the company, and it paid off handsomely. But there were several other things that the company tried and failed miserably at.

They started their grocery push nearly a decade ago and they are still nowhere close to taking a decent jab at the market. Considering the way the company pushes things, the rollout of Amazon Fresh, which is available in just a few cities in the United States and the United Kingdom, is a clear indication that they are yet to crack the grocery code.

On the shipping front, the company has strong relationships with Fedex and UPS, but still leased 40 cargo planes to build Prime Air. And then there is the drone delivery experiment which, if successful, will go a long way in helping to reduce shipping costs and delivery times.

Amazon always wanted to be a hardware player, and before the Echo family came into the picture Amazon’s hardware ambitions strictly remained ambitions. Kindle didn’t really set the charts on fire, Fire Phone finds hardly any mention in the smartphone world, and they have Fire TV and Fire Tablets to close out their devices list. Despite being a non-starter, Amazon refused to walk away from the devices segment, and finally found a moment of reckoning with the Echo line of smart speakers, which have already reached millions of homes.

Amazon was supposed to be the company that brought an end to the brick and mortar way of sales, but it also the company that is trying so many different physical store formats. Amazon opened a 6,000 square foot bookstore in Chicago this month, which not only sells books, but also has a separate section to showcase their devices. The company now has five stores in the United States: one each in Seattle, Portland, San Diego, Dedham and Chicago.

And then there are Amazon Pop-Up stores, similar to Apple stores that you can see in several US states. The Amazon stores allow the company to connect with people in a physical location rather than a virtual space.

In Seattle, the company will soon be throwing its Amazon Go, a cashier less retail store, open to the public.

What is Amazon Go?

Amazon Go is a new kind of store with no checkout required. We created the world’s most advanced shopping technology so you never have to wait in line. With our Just Walk Out Shopping experience, simply use the app to enter the store, take the products you want, and go! No lines, no checkout. (No, seriously.)

No one knows how many of these initiatives will succeed, but it’s clear that Amazon is not going to stop trying new things. The United States has become a huge lab for the company, where it experiments with as many ideas as it wants. If something works, a global rollout is immediately planned. It’s a rough-edged strategy, but losing money in the hundreds of millions is worth the effort if even one of those ideas can bring in billions, like Echo and its flourishing user base.

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