I’m In Love With The Amazon Doctrine (or The Once and Future King)

Jeff Bezos, amazon CEO

I just learned about something called The Amazon Doctrine, which explains why I love amazon so much.

The company’s leaders and guiding minds are committed to treating customers right. They invest, learn, and continually adapt to win and keep customers. They help me acquire knowledge, entertainment, and other solutions-oriented products to make me a more productive and happier person. They are what they proclaim to be: the everything store. And they never seem to stop working to make my life better so that I will continue to buy from them.

As a result, like tens of millions of other consumers, I reward amazon by shopping there.

I love that.

The Amazon Doctrine

So what is The Amazon Doctrine of which I speak? Here it is:

Above all else, align with customers.

Win when they win.

Win only when they win.

Peter Drucker, father of The Marketing Concept, would say that this is more than a doctrine. It is a business philosophy. As a philosophy, it is at the same time both simple and profound.

Our world would be a much better place if more leaders in business and government had the philosophic grounding and courage to commit to such a doctrine. It is puzzling to me why society’s leaders are free to accept this or a similar set of words as the guiding doctrine for their organizations right now, but they don’t.

The King Without a Crown

Leaders reject customer-centricity for a number of reasons, but primarily because they think there is a better way to create and run a successful business and to be a successful managerial leader.

An old-fashioned expression that is rarely heard anymore outside of small family businesses is “The Customer is King.” It amounts to the same thing as The Amazon Doctrine.

In today’s business world, we are expected to believe that such an expression is quaint, naive and out-dated. It may have served Walt Disney, Sam Walton, and Ray Kroc in their time, but we’re all so much more sophisticated now, having gone to business school and all.

The Shareholder is the New King

In today’s world, the customer has been kicked aside and the King’s crown sits upon many different heads, including employees, investors, shareholders, stakeholders, communities, country, and the planet Earth herself. If one were to write the most prominent doctrine in effect today in the form of The Amazon Doctrine, it would read:

Above all else, align with shareholders.

Note that shareholders are people who know very little about customers.

Not so brilliant.

I learned of The Amazon Doctrine in an article by Economics Professor Mark J. Perry, “The Secret to Amazon’s Phenomenal Success,” published on the website of The Foundation for Economic Education.

It’s worth five minutes of your time to read Perry’s article.

The Bezos Brilliance

Jeff Bezos, like Walt Disney, Sam Walton, Bill Gates, and Steve Jobs, is an iconoclastic entrepreneurial giant who has committed his life to an idea, putting curiosity, courage and commitment to work to create something great and valuable for billions of people. Those regular people, as consumers acting on their own private motivations, have, in acting to benefit only themselves, grandly rewarded Bezos and those who have supported his vision for their work.

Perry credits The Amazon Doctrine with the phenomenal financial success of amazon. Amazon’s market value has risen from $500 million in 1997 to more than $450 billion in 2017. Perry writes of amazon,

its stock is winning in the equity market only because its customers are winning daily in the retail sector with low prices, a wide selection of great products and the convenience of shopping online from home – or from anywhere with a Smartphone. And Amazon customers now increasingly get their orders delivered the same day or next day.

An editorial in The Wall Street Journal cited in Perry’s article so wisely reminds us:

The beauty of the free market is that entrepreneurs seeking to get rich have to make their customers better off at the same time.

Perry concurs, very aptly noting:

The online retail giant perfectly embodies the economic concept of “consumer sovereignty,” which describes the reality that profit-seeking sellers like Amazon make the greatest profits when they provide consumers with the best possible products at the lowest possible prices with the best service and fastest delivery. That is, companies like Amazon maximize their profits, share price and market cap when they treat their customers like royalty, i.e., the kings and queens of the marketplace.

So, why isn’t the customer always and everywhere king? It doesn’t seem that complicated.

Here’s to wishing amazon a happy and prosperous 20th birthday as a publicly-traded company!

(P.S. I love you.)

 

Barry Linetsky is a Partner with The Strategic Planning Group, and author of The Business of Walt Disney and the Nine Principles of His Success (Theme Park Press, 2017). The book is available in print and Kindle editions from amazon. Visit BarryLinetsky.com to follow his blog and read his many articles.

© 2017. Barry L. Linetsky. All Rights Reserved.

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