Jeff Bezos Classic Strategy For “We’re going to be unprofitable for a long time. And that’s our strategy”

Jeff Bezos Photo Credit: HLNtv

I have personally noticed a trend that; when a successful company courts too much attention, one way or the other it will come back to affect them, even if the fundamentals and operations of the company still remains strong. Take for example, IBM, Microsoft, Yahoo, MySpace, even Google and more recently Facebook (even though nothing has changed between the time the company went public and now, but the value of the company has halved). Look at the mighty success Apple, with the release of the iPhone 5, when you read what the critics have to say about it, the iPhone 5’s undoing is that Apple is such a success, that although this particular iPhone meets our extremely high expectations for it, it didn’t beat our extremely high expectations hence the disappointment (What an overly successful company/product has caused for itself). I think what the PR guys at Apple should do, is to lower the expectation of the market, then they would always stun us.

Here in lies the love I have for Jeff Bezos; Amazon is one company that is doing absolutely great, without courting any attention from the public. I met a reader of this blog, and he asked why I hadn’t featured Jeff Bezos? I can explain, at inception, we had planned to stay away from the big hitters, {like Bill Gates, Larry Ellison (Oracle), Mark Zuckerberg, Warren Buffet, Carlos Slim, Richard Branson, Sergey Brin and Larry Page (Google), Jerry Yang (Yahoo)} and that is why we haven’t featured him. One of the other things we also agreed at CreativityTurf was that, we will make sure to post a beneficial story.

I will tell you the truth, a person that decides to sacrifice current revenue in order to reap higher profits in the future, is sure a wise person. Info has it that, Jeff Bezos has been subsidizing the cost of the Kindle Fire for as much as $50 on each sold, in order to gain a foothold in the market for tablets, and in doing this he expects an initial loss. And it is working; everybody on the train when I’m commuting back home is seen reading something on his or her kindle, (I suspect they are all reading “Fifty Shades of Grey” though). was founded in 1994, when Jeff Bezos decided to quit his lucrative and secure job to own his business. He said he wrote the business plan for after making a cross-country trip from New York to Seattle. After which he decided to invite 300 friends and acquaintances to test the site, he was satisfied with their feedbacks. Jeff Bezos decided to take the site live and, within the space of a month, the company had sold books in all 50 states in America and in 45 countries. Within two months of starting, he had sold books worth over $20,000 a week. The success of the new start-up had ruffled a few industry leaders like Barnes & Noble and Borders, and they fought back, using their ready presence in the industry to muscle the small company out of the online book market. But Jeff Bezos disclosed his strategy to Inc in 1997: ‘we’re going to be unprofitable for a long time. And that’s our strategy’.

Very few people are ready to leave their comfort zone, as the saying goes “no risk, no reward”. I will advice you take that daring first step today, the first step is usually the hardest but you just have to believe yourself and take the step, if Jeff had stayed back at his job, let say he even rose to become the CEO, he sure wouldn’t be worth up to $1 billion, (even the very famous GE CEO Jack Welch’s net-worth isn’t up to a billion) but Jeff Bezos is the 26th richest person in the world, with a staggering $21 billion to his name.

If one person can read this and be spurred to take that step, then we would have achieved what we set out to do, which is to inspire/push/guide/encourage you, to be daring and take that step to become who you want to be.

26 Comments Add yours

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