Most people know Amazon.com as the world's largest online retailer, renowned for marketing products and services that include everything from Sony big screen T.V.'s to Coleman outdoor products, to Kindle eReaders and even vacation and travel packages. Just like the original "Pacman" of the earliest video games, chomping through all of the pac-dots to victory, Amazon appears to be rapidly chomping its way to becoming the biggest store on earth by taking on every product and service category within its reach. While Amazon's first slogan "Earth's Biggest Bookstore" did describe the business they were in, it did not describe the vision of the business they are becoming. That vision, as defined by Amazon's founder and CEO, Jeff Bezos, had no boundaries, and apparently still does not. Books were always just the beginning in Bezos's mind. Furthermore, one might say that it is Amazon, not the Internet, that is changing the face of retailing today by changing the way consumers shop and buy. If the Internet is a fundamental globally disruptive, game-changing event, then Amazon is its most disruptive pioneer. The company has singlehandedly changed consumer behavior: "running an errand" replaced by "going online;" instantaneous price-shopping from one location; actually bringing retail closer to a perfectly competitive marketplace. Amazon also paved the way to meteoric e-commerce growth for all other retailers by making consumers comfortable with it. Conversely, Amazon has already put Borders and other retailers out of business. Who's next? Or who will be forced to completely change its model in order to survive? Indeed, the Internet by itself is just a tool, albeit one for which its uses are still being discovered, with Amazon leading in such discovery. Bezos has stressed the point that Amazon must provide enormous added value to change consumers' shopping behavior. In fact, early on he called the Internet "a primitive infant technology." By now, of course, Amazon has taken that technology light years beyond its infancy, but, would concede there are light years remaining for its growth. So, how big is Mr. Bezos's vision of the "biggest store on earth?" Who knows? And I would suggest that even he does not have a volume number in mind. Currently, Walmart holds the "biggest" position, at almost $450 billion, against Amazon's $34 billion in 2010. However, one must note that "Pacman" has grown a blistering 300% since 2006, (vs. Walmart's growth during the same period of 21%), and is expected to hit about $50 billion in sales in 2011. And, while Walmart has 200 million visitors a week, Amazon is now hosting over 300 million per month, based on comScore estimates, and saw its traffic rise by 15% on Black Friday weekend. Amazon now has an over 20% share of total worldwide e-commerce traffic. Also, more than half of Walmart's revenues come from groceries and other nondiscretionary items, categories that Amazon has not even attempted to break into. And, as far as Bezos is concerned, it is still "Day 1" at Amazon, as quoted in his 2010 Annual Report letter, which contained, as do all his Annual Letters to shareholders, a reprint of his original 2007 "Day 1" declaration. So, how long does it take a $50 billion business, growing at a 300% pace every five years, to reach $400 billion in sales? You do the math. Answer: it's about 8 years. Furthermore, Amazon is growing beyond just being the biggest store on earth to being the biggest marketplace on earth where anybody and everybody can set up shop.

• published: 03 May 2013
• views: 1328