Jeff Bezos, The Kindle 2, and Amazon's "Seamless" Approach

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Amazon continues to zag as other companies zig.  Or at least it has kept profits and sales going strong as others fall short in this recession.  It is a remarkably different story from 2001, when the company's stock plummeted and people pushed for company founder Jeff Bezos to resign as CEO.  Now Bezos is the darling of business media, and he's making the rounds to talk up the launch of its Kindle 2 e-readerBezos went on Charlie Rose to talk about the Kindle and the company's approach to its customers.  In the interview, Bezos stresses the need to focus on customers rather than competition, and perhaps that helps explain the company's success.  Watch the full interview here.

Om Malik, writing at Fortune online and at Gigaom.com, picked up on Bezos's use of the word "seamless."

He wasn't talking about the device itself, of course, but the experience of the customer that uses it. Whatever you think about the Kindle, Bezos' choice of that word goes right to the heart of Amazon's own strategy, and the reason why the company, its operations and its stock have held up so well in the past few months. Everyone knows that Amazon's (AMZN) e-commerce site succeeded because its interface was intuitive to the point of being completely natural. What isn't discussed as much is the ethic behind that success: Simplicity is hard. Just as Amazon went to great lengths and expense to make the Kindle experience seamless, it has gone to a considerable amount of trouble to adhere to what is a very simple corporate strategy: Make it easy for the customer, and make it cheap. 

Some may bicker with the Kindle 2's $360 price tag as cheap, but the device is selling, so at the moment it is hard to argue with Bezos about that.  One way for companies to keep prices down is to watch the bottomline in operations and control its own debt.  In this case, Malik points out a bit of news that hasn't been getting so much attention in the Kindle craze: Amazon is set to go nearly debt free by the end of this month.

By March 27, Amazon plans to redeem the outstanding principle on its convertible subordinated notes due next year. Amazon offered the notes in 2000, and they accounted for $335 million of the company's long-term debt at the end of 2008. After the notes are redeemed, Amazon will have only $133 million in long-term debt outstanding. That's a far cry from the $2.8 billion in debt it held six years earlier.

Read Malik's Why Amazon is Bucking the Trend here.

And for a different sort of interview with Bezos, watch this clip from The Daily Show

 


Posted 03-05-2009 8:56 AM by Graham Griffith
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Comments

M2B wrote re: Jeff Bezos, The Kindle 2, and Amazon's "Seamless" Approach
on 03-05-2009 11:33 AM

For a while it appeared that Bezos would imitate Apple's iPod model, but now with the iPhone app (yesterday) launch, he really has taken a zag on that model. Kindle content on the iPhone sychs seamlessly with Kindle content on the Kindle device so that the reading experience is "seemless". I'm on the same page on my iPhone as I am on the Kindle and visa versa.  It's a pretty amazing integration.  

It will be interesting to see if  the iPhone app impacts Kindle sales negatively (I'm guessing not) but even more interesting will be whether the iPhone app becomes the iPhone ebook app of choice.

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