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Amazon

How Jeff Bezos turned a money-losing bookstore into a cash machine by reinvesting every dollar before he had to pay for it.

▶88K views on YouTubePreview, 1 of 8 tactics free

With Ben Gilbert & David Rosenthal

"Long-term, there is never any misalignment between customer interest and shareholder interest." — Jeff Bezos
Ben Gilbert & David Rosenthal, on the episode

For years the story on Amazon was that it was a charity run for the benefit of customers that would never make money. The skeptics had the facts mostly right and the conclusion completely wrong. Amazon was gross-margin positive from early on and chose to plow every dollar back into growth. The result is a brute-force learning machine wrapped around one of the best financial models ever built.

Tactic 01

Ben Gilbert & David Rosenthal, Acquired

Build Only What The New Medium Uniquely Enables

The play

Build only features the new medium uniquely enables, not what old formats already do.

Ben Gilbert & David Rosenthal says

If you can do something in the old paradigm you should, but with a new paradigm like the internet you want to find things you could not do any other way. With that huge diversity of products, 3 million books in print, you could build a store online that simply could not exist in any other way. Customers are very loyal up until the moment there is a better way for them to solve their problems than buying from us.

Try this

List what your medium uniquely enables that old formats cannot, and build only those features today.

3 free unlocks

Tactic 02

Pick The Beachhead With The Best Structural Math

Ben Gilbert & David Rosenthal says

Books are perfect commodities, so a paperback copy of a book is the same to the customer no matter where or…

Episode quotes and Try this

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Tactic 03

Invite Competitors Onto Your Best Real Estate

Tactic 04

Hire The Capability You Lack From The Best In The World

Tactic 05

Turn Variable Customer Experience Into Fixed Cost

Tactic 06

Finance Growth On Negative Working Capital

Tactic 07

Brute-Force The Maze And Learn From Every Wall

Tactic 08

Build Your Moat In The Downturn

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