This tells me that a prediction can become accurate. When trends happen well, it becomes more than accurate-more than the expected results.
He saw statistics that the internet was growing by 2300% monthly. He envisioned that people will start shopping online in the near future. He gave life to that vision by founding Amazon in 1995.
The venture has succeeded beyond measure. It has even surged in market performance during this period of the coronavirus pandemic economic crisis.
According to the Bloomberg Billionaire Index, Jeff Bezos now has a fortune of $138bn as the share price has risen by 5.3%. BBC reported that the firm has recruited thousands of workers to cope with the demand.
As at April 16th, 2020, Amazon market capitalization is $1.149tn according to NASDAQ, the growth was triggered by the lockdown of millions of people at home and economic activities have become partially shutdown except non-essential businesses.
But what is making the amazon business model perform tremendously in this time of harsh economic crisis?
This article will analyse what is making Amazon business model perform exceptionally at this time. How to learn and adopt some of its approaches in your business?
What is Making The Amazon Model to Pass The Test?
Well, there is always a cause of a reaction in any situation. This also includes the Amazon business surge. The simple reason is the coronavirus pandemic and its restrictive measures. See how the business model works well with what the world needs at the moment.
Virtual Shopping Friction
The government of every country has become aware that the Coronavirus can terminate an entire nation if it is not well contained.
This is the reason why the government of every nation including developing countries has ordered the closure of borders, businesses and implementation of social distancing measures.
But, while people stay at home, they must eat and that means they will be involved in economic activities but in a new way.
That is why Amazon is thriving this period. With the online shopping technology of amazon, you can shop anything in the comfort of your lockdown location in the US and experience an experience similar to offline shopping.
So, the number of online shoppers has dramatically increased as there’s panic in coming in contact with people.
Online Payment Friction
The other friction in transaction is the payment for the purchases or orders. Coronavirus can also be contracted through exchange of physical money.
That means online payment options remove the risk associated with physical money.
When you buy on amazon, you pay through a payment gateway of your choice. You don’t have to pay with physical cash but through your debit card or Paypal account.
That means that shopping friction and payment friction has been taken care of by Amazon, then what else?
People may be asking that if they buy a product online how will they receive the physical goods? The e-commerce business and logistics work hand in hand, one is incomplete without the other.
With amazon logistics, your goods will be delivered to your doorstep without any problem. With Amazon logistics, fulfillment is taken care of. Delivery is one thing and fulfillment is another thing.
When you have what you ordered for without distortion with complete features, that is fulfillment.
During this period, Amazon workers that are in the delivery department will need to take health protective measures in order to not contract the deadly covid-19 virus.
Whatever is your prediction of the internet, the coronavirus is validating it in one way or the other. With remote working, online or software tools have become the best working tools and online platforms have recorded exponential growth this season.
As you plan to pivot your business model, think more of adjustments that support remote working and automation or digitization.