Jeff Bezos reveals Amazon has 100 million Prime members
Jeff Bezos reveals Amazon has 100 million Prime members
in letter to shareholders
Amazon CEO Jeff Bezos has released his latest annual
shareholder letter.
Bezos has published a shareholder letter every year since
1997.
The shareholder letter is considered a must-read by many
business professionals.
By Eugene Kim April 18, 2018 Updated CNBC.com
Amazon CEO Jeff Bezos has released his latest annual
shareholder letter.
In the letter, Bezos stressed the importance of having
high standards in running a business. By setting high standards, companies are
able to live up to "ever-rising customer expectations," he said.
"How do you stay ahead of ever-rising customer
expectations? There's no single way to do it – it's a combination of many
things. But high standards (widely deployed and at all levels of detail) are
certainly a big part of it," Bezos wrote in the letter.
Bezos also disclosed for the first time that Prime now
exceeds 100 million members worldwide. In 2017 alone, Amazon added more Prime
members than any prior year, and shipped over five billion items through the
paid membership service worldwide, he said.
Amazon also sold the most number of devices last year,
with customers buying "tens of millions" of Echo devices, Bezos wrote
in the letter.
With regards to Whole Foods, Bezos said the
"technical work" is currently under way to bring Prime member
benefits to the grocery chain.
High standards
The annual letter, which Bezos has published every year
since 1997, is widely considered a must-read by business professionals for its
rich detail around the Amazon CEO's management principle and long-term
thinking.
This year's letter focuses on the idea of setting high
standards. Bezos writes high standards are "teachable" and that they
are "contagious" within an organization. But they have to be
"domain specific" because they don't automatically spread from one
area to another.
In order to achieve high standards, Bezos says you need
to "recognize" its exact meaning in a particular area, and then set
the "scope" for realistic expectations to reach those goals.
"So, the four elements of high standards as we see
it: they are teachable, they are domain specific, you must recognize them, and
you must explicitly coach realistic scope," Bezos writes. "Building a
culture of high standards is well worth the effort, and there are many
benefits."
In one of the more amusing parts of the letter, Bezos
gave an anecdote about a friend who visited a handstand coach — who told her it
would take six months to master the skill — in order to illustrate his point:
A close friend recently decided to learn to do a perfect
free-standing handstand. No leaning against a wall. Not for just a few seconds.
Instagram good. She decided to start her journey by taking a handstand workshop
at her yoga studio. She then practiced for a while but wasn't getting the
results she wanted. So, she hired a handstand coach. Yes, I know what you're
thinking, but evidently this is an actual thing that exists. In the very first
lesson, the coach gave her some wonderful advice. "Most people," he said,
"think that if they work hard, they should be able to master a handstand
in about two weeks. The reality is that it takes about six months of daily
practice. If you think you should be able to do it in two weeks, you're just
going to end up quitting." Unrealistic beliefs on scope – often hidden and
un-discussed – kill high standards. To achieve high standards yourself or as
part of a team, you need to form and proactively communicate realistic beliefs
about how hard something is going to be – something this coach understood well.
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