What can startups learn from Amazon.com
When it comes to startups, there are a few names that get thrown around as pinnacles of success. Think Steve Jobs, Bill Gates, Mark Zuckerberg, and Richard Branson. However, one person who is more than qualified to be associated with that mix hasn’t cemented himself as a household name. That person is Jeff Bezos. For entrepreneurs seeking guidance on start-up strategies for business, Bezos provides a wealth of lessons in scaling, risk-taking, and innovation. Today, Amazon is one of the world’s most valuable companies - with a market capitalisation of over US$2 trillion in 2024 (Yahoo Finance, 2024) - and Jeff Bezos remains one of the richest people on Earth.
So, what can today’s entrepreneurs learn from how Amazon scaled so rapidly, stayed agile, and built its dominance, especially as they navigate new challenges like Ai and big data? Understanding start up business strategies through Amazon’s journey offers actionable insights for founders aiming to compete in the modern market.
Always think big
It goes without saying that when trying to build a successful business, the big picture is key. When Bezos started Amazon.com in 1994, he took a product he knew would sell: books. This brings up the question for many founders: how did Amazon start up and what lessons can we extract for today’s start up strategies for business?
Before the online evolution, books were still a commodity; they still had value and were considered necessary. Moreover, they were the easiest pathway into the fluorishing online retail market. The sizes were relatively standard (think postage, parcelling, etc.), they were affordable, and people wouldn’t need to try them on to see if they fit.
Books were an entry point, not a passion. From here, Amazon.com diversified their offerings and started to sell CDs, DVDs, and technologies to the point where now, you are hard-pressed to not find what you’re after on Amazon.com.
What Bezos did was take a product he saw had big potential and could lead him to where he wanted to end up. He saw his big picture and reverse-engineered his pathway to achieving it: becoming the biggest retailer in the world. Startups can adopt these same principles as part of their start up business strategies, combining vision with incremental, data-informed actions.
Today’s founders can take the same lesson but supercharge it with data. The most successful startups use analytics to quickly identify high-potential niches and test new verticals – from Ai-driven product recommendations to predictive demand planning.
Continuously innovate
Whether you’re innovating your process, approach to the market, product, or delivery methods, never stop looking for a better, more effective, or more efficient way of doing things. Additionally, always look for new opportunities. Without stringent innovation, Amazon.com would not have been able to rise to the heights it is currently reaching.
What Jeff Bezos has accomplished is nothing short of genius. He has not only outperformed other online retailers but has also established a multifaceted brand that extends into various sectors and services.
Amazon.com now operates in a diverse range of areas, including:
- TV and movie productions, with Amazon Prime competing against Netflix in the entertainment streaming space
- A powerful cloud computing platform, Amazon Web Services (AWS), serving some of the largest web companies globally
- Amazon Publishing, which offers a variety of publishing options
- Grocery sales and delivery services
- A comprehensive inventory of Amazon-branded products that rival traditional brands
- Development of drone delivery systems for a wide array of products available on Amazon.com
Through these initiatives, Bezos has transformed Amazon into a dominant force across multiple industries. Entrepreneurs looking for examples of start-up strategies for business can study how Amazon diversified strategically while remaining true to its core.
To further innovate the company’s offering, all these services have culminated in a nostalgic venture: bricks and mortar stores. It’s interesting to think the retailer has ‘experimented’ with physical stores, signalling a full eclipse of the online realm.
In 2024, Amazon’s biggest innovations are increasingly driven by generative Ai and advanced data science. From Ai shopping assistants to warehouse automation, its edge comes from embedding data and Ai into every layer. For startups, staying innovative means doing the same: using data to experiment, pivot, and scale smarter than your competitors. This aligns with proven start up business strategies that prioritise agility and learning over static planning.
Don't panic if or when you fail
Failure is inevitable for most startups. That doesn’t mean you should try to fail; it just means looking for lessons when the inevitable happens.
Part of what makes Amazon.com so prolific in the innovation game is being one of the biggest platforms for ‘learning curves’. Bezos has tried many ventures, which have fallen flat or outrightly failed. From smartphones to discount coupon sites and travel agency services, the failures of Amazon.com propel them into their next idea, onto their next venture and their newest success.
Today, failure happens faster and cheaper for data-savvy startups. Companies that use analytics to run small, rapid experiments can learn faster and bounce back smarter – one of the key reasons 87 per cent of high-growth startups say data skills are mission-critical to their teams (TechCrunch, Startup Survey 2024).
Profits matter much less than market share
This bucks the trend for many major businesses centred around investments and shareholders. Amazon.com doesn’t amass cash in the bank like tech giants Apple or flow cash back to shareholders like every other corporate organisation.
It ventures into new markets and focuses on strengthening dominance in the markets it already owns. Establishing your brand as the dominant, go-to force within your market and growing your market share is far more valuable than take-home profits. Owning larger portions of more markets means your share prices usually go up, too, which helps!
Even today, Amazon often prioritises growth over short-term profit. For startups, this means using data and Ai to find new customer segments, improve lifetime value and grow share faster than the competition, even in lean times. This principle is core to any effective start up strategies for business or start up business strategies plan.
While Bezos and Gates fight it out to become the Earth’s first trillionaire (seriously, it’s a race), the bigger lesson is clear: data-driven decisions, relentless innovation and smart risk-taking are the backbone of lasting growth.
If you want to build the skills that fuel today’s most innovative businesses – from startups to multinationals – explore RMIT’s 100% online Master of Business Analytics and AI Strategy, Graduate Certificate in Business Analytics or Graduate Certificate in Data Science. Learning how Amazon succeeded is a perfect complement to understanding effective start up strategies for business and start up business strategies in the modern economy.
To learn more, get in touch with one of our Student Enrolment Advisors on 1300 701 171.