In the realm of disruptive technology, there’s a single company that is the leader. Amazon ($AMZN). Amazon and its pioneering CEO and founder, Jeff Bezos, are responsible for changing the way industries are run than I could think of and are still doing. In this article , I’m going to discuss the factors that make Amazon such a powerful machine and the numerous industries that were disrupted by it.
What was the last time you went to the doors of a Barnes & Noble ($BKS)? Or any other store in general? What was the last time you visited the Amazon website? I’m willing to wager that almost all of you have been browsing the Amazon website over the last couple of weeks, but I’m equally willing to wager that nearly nobody has visited an actual bookstore for long time. The industry of bookstores, represented by the former giant Barnes & Noble, was the first victim of Amazon’s radical tendencies. Visit:- https://www.cruxfinder.com/
The origins of Amazon date back to 1994, when Amazon launched an online store. Through its design as an online store, Amazon was able to provide a wider range of products than physical stores, in addition, it was able to provide the same variety at a lower cost to the customer.
Like the free market typically does, customers choose the less expensive option when presented with the same product or service. In 2007 Amazon was surpassing Barnes & Noble in terms of revenue generated from book sales. This was in the same year that they launched their first edition of Kindle electronic book reader. In 2010, sales of digital books surpass physical book sales on Amazon. Amazon also manages the business and website Audible which is one of the largest players in the audio book market. In the year 2011, Borders Group, what was only a few years before the second largest bookstore chain across the United States filed for bankruptcy and then went out of business within a couple of months. As of the writing of the article Barnes & Noble has an estimated market capitalization of 454 million dollars. Amazon has an estimated market cap of 832 billion dollars. Based on the market cap value, Amazon is worth nearly 2000 times the value of Barnes & Noble. Amazon’s entrance into the bookselling industry and its replacement of businesses which were previously firmly to the market is the beginning of many industries that the Amazon bull has changed.
NO END IN SIGHT
After the direct retail sales as well as fees paid to third-party vendors through Amazon’s website, Amazon site, Amazon is the largest percent of its revenue through its Amazon Web Services (AWS) division. AWS has a long history dating back to the year 2006. In the course of the year 2006 Amazon introduced a series of services, Simple Storage Service (S3) which is a storage for files service, as the name suggests. suggest. It was a simple Queue Service (SQS), an automated service that is designed to manage messages queues. To conclude this year’s calendar, Amazon introduced Elastic Cloud Computer (EC2) which is a service that lets users pay for servers to run applications and simulations. There are currently around 100 services available within the umbrella of Amazon Web Services that can meet almost any digital requirement. Today, more than half of cloud computing in the digital age is managed by Amazon. Much like changes that occurred in the bookstore business, Amazon has taken control. In 2020 cloud computing is expected to be more than 400 billion dollars in revenue. It is also expected that Amazon has the potential to be the dominant player in this sector in the near future.
CLAIM TO FAME
The industry of grocery and retail is an excellent illustration of an industry that has been altered by Amazon and the things is their most well-known for is. But, first of all, Walmart ($WMT) has only 3 times the revenues of Amazon and it’s not as if Bezos and Co. have become the dominant force in the retail sector, however they certainly have created a gap. It’s possible to say that they have disrupted the market. Since their inception around 1994, for their first 4 years, they were a purely online store however, in 1998 the company expanded its catalog and began to sell more than only books. Since it, their online sales have increased exponentially every year, and they’ve even been accused of driving conventional retailers out of their business. Amazon is able to generate around 85% of their revenues from their retail operations which is the largest portion of Amazon. Through the pioneering of online retail, Amazon has been able to establish their position among the largest retailers despite being completely online. They also benefit from the convenience and lower costs. In 2017, more recently, Whole Foods, a premium grocery store, was purchased by Amazon to increase their share of the grocery and retail market. With their online retail arm and their physical grocery division, Amazon is able to gain a significant market share and have authority over the market. To give the magnitude of Amazon in perspective, more than two-thirds of households are subscribed to the Amazon Prime membership.