Page 82 - DNBI_A01.QXD

593 : STEP ONE – SEEKING AND SHAPING OPPORTUNITIES

internet-based selling as opposed to physical retail sales – far too many
product titles for a single store to stock.

His research in these two markets led him to prefer books over music
because there were 1.5 million English language books in print and
because consumers kept demonstrating that they valued authoritative
selection. As he noted, the biggest phenomenon in retailing was the big-
format store – the ‘category killer’ – whether in books, toys or music, yet
the largest physical bookstore in the world had only 175,000 titles. With
the two biggest booksellers, Barnes and Noble and Borders Group Inc.,
accounting for less than 12 per cent of sales, and a fragmented supplier
base of over 4,200 US publishers, Bezos was confident that there
‘weren’t any 800-pound gorillas in book-selling’.41

A ‘total’ product range was not the only element in the proposed offer
with which Bezos planned to attack traditional book retailing. Bezos had
a keen sense of what the traditional book-buying experience represented
in its total (and worst) form: going out shopping on a rainy day, searching
for books you cannot find, queuing for help, queuing to pay, waiting for
out-of-stock books which no one tells you have been delivered and then
starting the whole process all over again.

He also realised that a large part of the pleasure of book buying is
browsing, being guided to recently published books which may be of
interest and comparing notes with others. He realised that an
opportunity existed for an internet service which did not just replicate a
‘bricks-and-mortar’ operation which sold books, but which actually
offered an enhanced service. This service could include information,
advice and recommendation customised to individual reading profiles.
His insight into buyer behaviour recognised that customers valued not
just the ability to purchase books but also the ability to access the
information which led to their purchase.

Bezos realised that the internet could personalise every customer
interaction and ‘own’ the customer relationship rather than be restricted
to mass production of a standard service to a mythic average customer.
This insight allowed him to challenge the traditional retailer–buyer
relationship. Rather than act as administrative middle-man for routine
transactions between book publisher and book buyer, Amazon.com
created a new role of ‘go-between service provider’, assembling a range
of different service elements which provided the customer with a
M