Click through to the good bits.

00:00 Introductions.

04:51 Glitch in Amazon causes problem for popular sites.

09:54 Understand Jeff Bezos.

11:31 The snowball effect.

14:51 Customer obsession.

20:38 Amazon Empire.

Martin Henley
Hello there, my name is Martin Henley. This is the effective marketing content extravaganza. If you’re new here, you won’t yet know that I’m on a mission to give you everything you need to be successful in your business. Providing, of course, what you need to be successful in your business is to know more about and to be implementing much more effectively and enthusiastically your sales and marketing. Because if you’re in business, you are in the business of having customers profitably. And sales and marketing is how you get to have customers profitably. So I’m here giving you everything I know about sales and marketing as part of the what the series I’m pulling in anyone I can find with experience to share with you so that you can be more successful in your business as part of the Talk Marketing series. We bring in Melanie Farmer every other week, and we look at the marketing news and speculate wildly about what that might mean for you in your life. And we look at the very best and the very worst of marketing content on the internet, which is what today is about. So if that sounds like it might be interesting or useful, I really hope it is because that’s the idea, then you should take a second to Like share, subscribe, comment, get involved, because that’s the kind of motivation we need to keep on this epic journey.

Like I say, today is Reaction Time, we look at the very best and the very worst of marketing content on the internet. And there is a little bit of jeopardy to this, I’ve got absolutely no idea what I’m going to be reacting to. So this is a proper reaction. What has happened is Clay has put together the Claylist, there are six videos, one of which we’ll be watching today, what we do is we go to random.org, and we roll the dice. And that will give us a number. Did that give us a number there we go, it’s given us a number finally given us a number. So the number is number five, so we should check out video number five, which is here video number five. Bear with me while I get this sorted. Video number five is this one. So I am going to what am I going to do I am going to copy video number five. And I am going to put that into the world wide web. And we are going to see what comes up and return and this is going to be. Okay, so the video is oohh this is interesting.

So the video is the grand theory of Amazon. Wow. Okay, so the grand theory of Amazon, does that come to me? No, it doesn’t. Okay, so let’s do it like that. So it does come to me camera Blackmagic Design, this should be camera. I don’t know anything about Amazon. I’ll be very honest with you. So I didn’t know there was a grand theory of Amazon. I think if there is a grand theory of Amazon. I think it’s customer centricity. I think Jeff Bezos is supposed to be really interested, I wanted to say maniacally interested in making sure that it’s customers who get the very best deal on his business. So obviously, I’m an Amazon customer. Obviously, I have a view on Jeff Bezos a thought, I think it’s really hard to be in that position and keep in touch with reality. So when he was thanking customers and customers and the Amazon staff for sending him into space, I thought that was really, really, really poorly judged. Because I don’t think anyone who’s bought from Amazon or anyone who works for Amazon has any interest in Jeff Bezos going into space. So, you know, interesting times 2022 I think we’re thinking quite differently about these billionaires now. Amazon obviously is a phenomenal company. I’m not qualified or unqualified. I’m here. I’ll judge if I want to judge. So let’s go back. Let’s just see what the grand theory of Amazon is. How long is this video? This video is 10 minutes and 30 seconds long. It has 2.4 million views. The channel is called Pollymatter. And they’ve had 192 million views and have 1.7 8 million subscribers. So this is interesting. We’ll look at the comments afterwards and we’ll see what’s going on with the grand theory of Amazon.

Narrator
On February 28 2017. You might have thought the internet was down for hours without Netflix, Spotify, Buzzfeed Reddit, Dropbox, Pinterest, Imager, Leak, Tinder and 1000s of others, even the site that reports outages. That’s embarrassing if the world was more productive that day. Now we know why our slash outside became just, you know, outside a shark hadn’t bitten an underwater cable. Nor was it five, nine, just an Amazon engineers typo. Probably a stressful afternoon in Seattle, but also an impressive demonstration of the company’s size and power. Amazon Web Services who so much of the internet that for many people, myself included, it basically is the internet. We know Amazon as an online store, company store there.

Martin Henley
Okay, good. So I wasn’t thinking about this right at all. This is the secret not the secret Amazon but the invisible Amazon that actually runs the internet goods I know about the shark story. I spent a little bit of time in Vietnam. And the shark story in Vietnam comes from the beginning of the internet, where the internet went down for the entire country and some government officials said there’s a shark that bit the cable, and it’s famous now. So now whenever the internet’s down, I’ll say as the shark been busy buying cables again. So I know about that. Okay, good. So we’re talking about that Amazon that is the monster behind the internet’s good. Let’s see how this goes.

Narrator
Their products and its warehouses which handle the marketing and shipping and returns for us. This means total convenience, one click away from $125.27 pound gummy bear pythons or five crisps. $2 bills for $20 Wait, that’s not how money works. 100,000 companies make over $100,000 A year this way. But for Amazon, it’s only a fraction of their business. There’s also Twitch Whole Foods.

Martin Henley
Whoa, whoa, whoa, whoa, whoa, whoa, there’s 100,000 businesses making more than $100,000 through that flow through Amazon. selling on Amazon. What are they called? I know what they’re called. It’s not coming to me. 100,000 companies make at least $100,000 How much money is that? So I’m going to do the sum because 100,000 companies make $100,000 So 100 123 times 100 123 equals know what that is? was one point eat and is that a billion dollars? Timberland is a lot of money. Okay? That was embarrassing. That didn’t work

Narrator
$100,000 A year this way, but for Amazon, it’s only a fraction of their business. There’s also Twitch Whole Foods Kindle Alexa sensibly named echo echo plus Echo Dot Echo Dot kids Amazon Tap echo connect echo spot echo show and echo look also a completely different Alexa Fire tablets and TV Prime music video pantry ring doorbells, Zappos IMDb fresh Goodreads and over 70 consumer brands you’d never even know they owned. Hardly a month goes.

Martin Henley
That’s a lesson in diversification, isn’t it? That really is a lesson in diversification. This is what I say if you have brands you can sell absolutely anything and Amazon are huge brand now. I’d be interested to know what those 70 Maybe we’ll google it afterwards what those 70 brands are that we wouldn’t never know what owned by Amazon. We’ll look at that after it’s by

Narrator
where they don’t enter and dominate a new industry. Just trademarking the slogan, we do the prep up the chef was enough to drop a Blue Apron stock 12%. They’re even investigating pharmaceuticals, education and finance. Amazon defines its competitors as publishers, producers and distributors of physical, digital and interactive media of all types and all distribution channels, among others that

Martin Henley
so that everyone in the world everyone in the world is a competitive Amazon, publishers, producers and distributors of physical, digital and interactive media of all types and all distribution channels. Web Search,

Narrator
everyone which raises the question is Amazon scatterbrained many of these products have nothing in common Yes,

Martin Henley
this video is beautiful. By the way this is inspiring.

Narrator
Sturdy they wanted to conquer streaming video today sell organic grapes in grocery stores tomorrow who knows and their ideas increasingly, let’s say creative two day delivery How about to our delivery, a 3d smartphone a grocery store without employees a front doors that unlocks for delivery drivers, a flying warehouse complete with detachable drones for all its success as an online store more and more it also seems distracted. At least that’s how it looks. The only way to make sense of their actions and mistakes and anticipate their future is to see the world as they do and there are three pillars to Amazon’s plan for world domination.

To really understand Amazon, you have to understand Jeff Bezos like Steve Jobs. Elon Musk the philosophy of the man is that of the company. Apple was founded by people in love with technology and its design. No matter how big the company gets, this will always be reflected in its decisions, priorities, even mistakes. Amazon began as a bookstore, but that was never its heart and soul or spying. Bezos chose books because no one bookstore could hold all of them warehouses visited on the internet could but make no mistake, they aren’t a book company, a website, a delivery network, or even a retailer. Amazon is a scale company Bezos understood that when you take something and multiply it 100,000 million times you can do things all the small businesses in the world never could a tree is a tree but put 400 billion together and you have the Amazon rainforest, a force so powerful it controls the world’s climate from any other company. This sounds like generic business speak. But Amazon really means it. We say a company is focused if it specializes in beverages, or cars or bad website design and puts all its XP into that ability. Amazon is rare and that its specialty isn’t the product itself. But at scale. That’s the focus when considering a new product. The flowchart is pretty simple. Would this benefit from being 1000? times quicker, bigger, easier? If so you can bet Amazon either sells it or soon will, it’s easy to stop there, sit back and enjoy the profit. But Amazon asks, okay, now what can we do, and this is why it’s unstoppable. The snowball effect first get as many users as possible give out $50 tablets free shipping license echoed to every company willing more users bring more data, which helps improve the product. And the better product attracts even more users, they aren’t just making it easy to live off Amazon, they’re making it hard not to that’s the power of data in the hands of someone operating at this scale. It’s why there’s now a movement to limit this why companies like Digi me who I’ve previously mistaken for a data collection company actually let users manage and safeguard their information. And the results are things like prime, it may lose money on the heaviest shoppers, but with 100 million of them. They’re winning a lot more than they’re losing. So why purchase competitors like Whole Foods? Exactly. Because it’s not what they’re good at books never expire? Well, some do. But groceries not so much. You have to go back repeatedly putting Amazon in your routine. And with so much shipping spending $11 billion fulfilling 300 million packages in 2015, they can do something almost no one else can.

Martin Henley
I’m aware that I’m not doing much reacting, I think I feel a little bit like a rabbit caught in the headlights because we all kind of know this. But we don’t actually know the numbers. The numbers are insane. And we all have a view on Amazon. And I think some not particularly cool things go on Amazon. And and that’s something to consider as well. But I bet I don’t know anyone I bet my dad isn’t really on the internet. He’s probably not an Amazon customer. But 100% They have Amazon packages delivered to the house. I wonder if I know anyone who isn’t actually an Amazon customer doesn’t actually benefit from Amazon products? Because Ah, yeah. I mean, in terms of scaling a business in terms of leveraging a brand in terms of having customers profitably. Amazon does it Amazon has done it to the millionth degree, you know, the billions, trillions degree, they’ve just done it. They’ve just like, everything I talked about all the time, businesses about having customers, you know, leverage your brands, all of these things Amazon has Amazon just does it. And then exactly like they’re saying in this video, they can then like if they can do something 1000 times quicker. The issue is this is the real issue for me is I am anti Corporation, I really do think it’s us small businesses versus these corporations. And so Amazon is the worst offender in terms of putting small businesses out of business, particularly retailers but you know, who knows what these other 70 brands are. So that’s my big issue with it but in terms of achievement, in terms of actually taking what I tell people to do all the time, which is you know, develop a brand, build a customer base leverage the customer base. Amazon have just done that. This is nothing like why expected and I’m not reacting much because I’m just like a Ghast these figures are insane.

Narrator
Compete with UPS and FedEx. They already leased 32 Boeing 767 cargo jets and plan a massive cargo hub in Kentucky but that’s just the beginning after announcing a new $79 Kindle,

Martin Henley
so this is While I was I was thinking this was gonna be about was this customer centricity thing. Bezos wrote,

Narrator
There are two types of companies those that work hard to charge customers more. And those that work hard to charge customers less both approaches can work, we are firmly in the second camp. And he’s really not kidding. The parts alone cost $78.59 plus $5.66. For assembly, that’s a loss of $5.25 for every Kindle sold, not including things like marketing, licensing and support. And sure there are ads, but only as an option. Companies like Facebook and YouTube are fundamentally advertising companies. No matter how well intentioned YouTube employees are, unless something drastic changes, the company will always prioritize advertisers over creators, that’s the business model. And then there are customer companies where you and I decide what gets demonetized, Apple is comfortable charging more for the very best experience. And for Amazon, hoping the customer means making us pay as little as possible. Both are loved in a way that’s impossible for an advertising company, you might say they only care about the customer to make more money. And maybe you’re right, there’s no way to know. But the effects are the same. When Apple refused to unlock the San Bernardino iPhone, when Amazon takes a loss for the sake of our wallets and offers some of the best customer support I’ve ever had. It may only be a calculated business decision. But it’s great for us, of course, when the customer,

Martin Henley
yeah, don’t look after your customers to be nice, just look after your customers. Because if you’re in business, you’re in the business of having customers. So this goes to everything that I talked about all the time, you know, have customers have a brand, leverage the brand. But don’t, don’t be nice to your customers. Because Because you’re a nice person, I do out of complete self interest. Like if you do a better job for your customers, they’ll be with you longer, they’ll spend more money. So for me, there isn’t even a dichotomy here, there isn’t even an issue here. Just don’t because you’re nice, like just be be in business being in business is about having customers profitably. And if, as is reported, as is probably true, the top 500 corporations in the world are spending in excess of 30% of their turnover, turnover and acquiring customers. So retaining those customers for as long as possible. selling those customers different things driving up your customer value is how you stay in business. So there are issues with Amazon, like I don’t think they’re particularly good to their staff. I don’t think they’re particularly good to the environment. Like whenever I’ve received an Amazon package, it’s been in a box, which is 10 times bigger than it needs to be, for example, that’s taking up room on the fly apart from the materials in the box, taking up room in the truck, it’s taking up room in the plane and or whatever, you know, shipping all of these goods all of the time can’t be good for the environment, it can’t be good for the environment. But Amazon is how you do business. Like if you take anything from this, like just understand that if you’re in business, you’re in the business of having customers profitably. And if there is one company in the world that does that better than any other I think better than Apple better than because I’ve experienced Apple’s customer service recently and it’s awful. Better than any company in the world better than the social media is better than the Twitter’s better than the whatever the one can’t the one business that really does business properly. I having customers profitably is Amazon. And if it’s a loss leader, like selling people a device that they can now read their books on, then that’s also business, you know, I mean, if you’re losing $3 and $6, to ship it, and whatever but you are, you are associating yourself you are implanting yourself in your customer’s life by giving them the device that they read on so that they will continuously come back and buy from you. Then that’s also good business. This is a great video clay. You have outdone yourself here. This is perfect. That’s the wrong way. It’s not the right way. That’s the right way.

Narrator
Comes First everyone else come second, employees can easily be forgotten in this never ending quest to satisfy us. Here’s how Bezos describes it. One thing I love about customers is that they’re divinely discontent. Their expectations are never static. It’s human nature. We didn’t ascend from our hunter gatherer days by being satisfied. This is the hedonic treadmill no matter how much our lives improve our expectations, simply adjust almost any other company would resent this constantly having to improve their products even the rate at

Martin Henley
genius. absolute genius. This is true. You do resent this. Customers are never grateful customers are never satisfied. So yeah, of course this is like could never be good enough employees peeing in bottles like Who was it somebody said that customers were. Staff are more important than customers because it’s the staff who deal with them. I believe in that. But 100% customers, it’s about having customers

Narrator
which they improve, but Amazon embraces it. They’re just as discontent as we are. Except if there are billions to be made by concentrating on scale and customers, Why can’t anybody else do the same? How can a tiny online bookstore do something exponentially better than Walmart, the world’s largest company by revenue?

It’s easy to think of a CEO as the supreme leader of a company but even Bano has a boss. In this case, shareholders. The longer a company loses money, the greater its risk and the more anxious get investors but for Amazon, lack of profit isn’t just tolerated. It’s celebrated. They could stop and make $1 They’d rather wait and make five using profit from things like AWS to fund projects like Kindle and echo because Bezos is so open about this shareholders sign off and they can think far into the future. Those cargo planes not so cheap, but that doesn’t stop Amazon supermarkets operate at a 1% profit margin, but Amazon can buy whole foods and actually lower prices.

It also gives them freedom to experiment the fire phone was never ready for primetime, but that’s a small price to pay for this strategy movie pass Snapchat, Uber Spotify Blue Apron, all starving companies following in Amazon’s footsteps crossing their fingers money will come later X Google CEO Eric Schmidt says Amazon is already Google’s biggest competitor AWS competes with Google Cloud echo with Google Home prime and express YouTube and Twitch even search a company this diversified will face plenty of challenges a lot will change in 10 years, but will always want low prices, fast delivery and easy shopping as Amazon conquers one industry after another they may only have one real competitor, the government who may say do not pass go and do not collect $200 profits may be shaved but you and I will always be able to shave and comfort with Dollar Shave Club. They’re more than just razors, toothpaste, body wash wipes hairstyling and more. Everything you need to look and feel.

Martin Henley
Well, that was slick into the ad, but didn’t even warn us. Now we’re going into the ad where does the ad end? Because they’re not paying me. Alright, so that’s shaving shaving.

Narrator
Members can sign up for just $5 you get this kind of price. Nearly trudges on me you can pay for what you need, with the link in the description Dollar Shave club.com/poly Mater thanks to Dollar Shave Club and to you for trying it out.

Martin Henley
Good, we got to the end, I am properly properly properly properly torn. I don’t like corporations. I don’t like corporations. I prefer businesses that take much better care of their staff. I take I prefer businesses who are much more concerned about what goes on in the environment. But you have to accept let me know if I’m wrong. have to accept that Amazon have just done business better than any business on the planet. Like they they really have. Yeah, they really have so what are we saying? What do we see he’s seeing in the comments okay, so what we’re seeing come chat at the stats sponsor transition was so smooth it really was so smooth. Can we make this bigger so smooth? Just like my face after using the Dollar Shave? Red It’s Michael J value investing right it’s sort of redesign and seem to put nearly zero XP I’ve never seen such a drastic improvement in contact from your first video and now nice job Polly matter. It was a beautiful really video I love how he literally talks about the employees for one second and the competitors for two. We will never know why Amazon makes things so cheap. Yeah, we do is to raise prices later. like they do on every single product after they’ve ran out to competitors. I think that’s true. That’s capitalism though. That is capitalism. I don’t know what’s going on here. But every video you post makes me happy saying that those are perfect. Might be a little too much. But hey, they are keep up your awesome work. Amazon. Hey, let’s buy YouTube. Google. No. Amazon. Okay, let’s buy YouTubers. Excellent analysis. As always, this channel always delivers. I’m gonna subscribe today. I was just talking to my friend who’s a bike courier in South Seattle. He just found out their app was owned by Amazon. He started asking around and realize that seven out of eight of his roommates. Were also employed by companies that were owned by Amazon. Okay, good. So this is what I’m interested to know. So Which brands are owned by? Amazon? Okay there’s loads okay Wikipedia is reliable pins on Amazon Basic Amazon wag Mama Bear presto, wickedly prime apparel that’s not a very that’s not 70 brands is it? But look there are many, many more which companies are owned by Amazon audible Amazon Web Services diapers.com Good Reads IMDb now Shopbop teach street Twitch Zappos? Yeah, how many brands does Amazon have over 400 Private brands, offering 243,000 products in almost every category from food and clothing, to technical gadgets. Okay, good enough. The reason I do this is because I should be consuming more actual interesting useful content, and, and then sharing it on the site is why I should be doing. If you are in business, there is a lot that you can learn from Amazon, clearly, there’s a lot you can learn from Amazon. There’s a lot you can learn from other businesses, if you are able, in some way, shape, or form, to build yourself a brand, to have lots of customers and to come in, and to find new ways of delivering value for those customers. And exchanging that for value for your brand. That’s how you run a business. Like take care. And if you can do that, whilst you’re taking care of the environment and taking care of your staff and doing all those things, then that 100% is how you do business. This has been really interesting and useful. I hope you found it really interesting and useful. If you have you should take a second to Like Share, Subscribe and comments. Get involved because we need a little bit of help to be motivated to be producing these videos for you. So next along will be Tuesday, there’ll be a talk marketing for you. I’m sure that’ll be interesting. Like, share, comment, subscribe, and we will look forward to having you here again very soon. Thank you very much.

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