What Is Amazon?

Amazon changed the face of the e-commerce industry by proving that online shopping is a gift to the consumers. 

From its beginnings as an online bookstore, the company has now turned into a multinational giant with its branches in every possible industry.

On July 5, 1994, the company came into existence when Jeff Bezos decided that offline bookstores are not operating at the desired efficiency. Once the website started getting traction, Bezos quickly diversified into multiple products like jewelry and games.

Today, it stands tall with its position in the top 5 companies of the world and has also secured the pedestal of becoming the most valuable brand in the world. The brand’s goodwill has turned into an influencing agent, reaping multiple benefits for the company.

In 2021, Amazon has surpassed the most profitable company in the US, i.e., Walmart. 

You can find everything on Amazon, be it electric bicycles or a pack of vinyl stickers! If you are curious to know more about the company, dive into this article and unravel how Amazon works.

How Was Amazon Launched?

Amazon was launched as an experiment by its founder, Jeff Bezos, in the technologically advanced city of Seattle. Seattle offered many worthy avenues to Amazon in terms of human resources as the world’s best minds had been working in the city.

Post their success in selling books; Amazon went public in 1997. They diversified their business and became the one-stop destination for people to purchase almost everything that they could possibly want.

In 2002, Amazon entered the turf of cloud storage and web services by launching their homegrown product, Amazon Web Services (AWS). This platform changed the winds of cloud computing as the quantum of their operations at which they were operating were never recorded before.

Since then, Amazon has been capitalizing globally by altering their services and modifying them according to the different regions they chose for business. The conglomeration of all these small efforts made Bezos the richest man in the world.

What Does Amazon Do?

Amazon has a very distinctive array of operations that it carries out on a daily basis. It has more than 40 subsidiary companies that have been acquired back to back. Here are some of the main things that Amazon does so that you can get a basic idea. These things will also highlight the revenue streams of Amazon.

1.    The Web Store

The most prominent source of Amazon’s business comes from the online retail store that has been established for every country that they operate in. Their online bookstores have turned into megastores that house thousands of retailers who can register online and sell their products.

These retailers have to compete with the in-house brands of Amazon that are called Appario Retail and Cloudtail. There is a small fee that every retailer has to pay to Amazon for listing their products. The proceeds from the sale of their in-house brands and the registration fees from the retailers constitute a significant chunk of Amazon’s revenue.

2.    Amazon Prime

Amazon Prime is a premium service that Amazon launched to create a priority channel for their prime customers. There are multiple benefits associated with Amazon Prime. The consumers can avail of free and swift deliveries along with prior access to their annual sales.

Amazon Prime also entitles customers to access movies and music. The online video library of Amazon Prime has enticed many people to enroll in the premium membership, thereby adding a lot of revenue.

3.    Audible

Audible was acquired by Amazon Prime as soon as the concept of audiobooks became mainstream. The megastore provides the customer to buy these audiobooks, which are significantly cheaper than purchasing a hard copy.

Audible subscriptions were given out for free at the beginning to customers as a means to increase awareness of this service. Now that it has become popular, people are more inclined to buy them rather than paperback copies.

4.    Amazon Web Services

As mentioned earlier, Amazon Web Services is a dominating player in the cloud computing industry. They provide cloud storage to gigantic companies like Netflix who operate with the content that is uploaded onto Amazon’s servers.

Amazon Web Services also promote small businesses with their competitive pricing and unique offers so that more and more data can be uploaded on their servers. The company has given tough competition to Microsoft Azure, which is also a key player in this domain.

5.    Amazon Kindle

Amazon was quick to capitalize on the technology of e-books by developing Kindle. Kindle is a device that gives users access to millions of e-books at the convenience of a single click. The technology was further shifted to an application so that the users can enjoy reading e-books without purchasing the Kindle device as well. Kindle has indeed “kindled” the craze of reading as Amazon recorded massive sales of the product.

6.    Amazon Basics

Amazon Basics is a subsidiary of Amazon that covers everything that the other subsidiary companies do not. Basics include bags, clothes, shoes, electronic items, wires, cables, and plenty of other day-to-day stuff that is commonly bought by the masses.

Basics aim to provide quality offerings at highly competitive prices.

7.    Amazon Partnerships

Amazon has entered into various worthy collaborations with major corporate giants such as Nike, OnePlus, and Apple. It entitled Amazon to exclusive rights for selling the products of its partners, and therefore it drove in a lot of sales for the company.

The merchant partners benefitted from the easy to navigate algorithm of Amazon and also with the extended visibility that they received. 

Final Words

There are many other services that Amazon has branched into since the inception of the company. It has come to a point where Amazon has its monopoly in almost every industry and is still exploring to find more avenues.

For your A to Z needs, Amazon has got you covered!