The Amazon Economy

Everyone is happy that the stock market is booming. Amazon was $35 in Nov 2008. Today its kissing $1700 per share, which is approximately 48 times increase in valuation. What happened in these Ten Years?

Amazon was always known to reduce friction in the purchasing experience even before 2008, as it is today. They have always used AI (well no one called it AI at that time) to change prices of items sold on their website based on demand.

Apple happened.

Apple created a smart phone with a very simplified mode of accessing the world wide web. The apps!

And developers jumped the bandwagon to create innumerable apps, profiting Apple and in turn getting rich themselves. A very democratic approach to software development and profitability.

Amazon indirectly profited. Amazon adopted the Costco idea of membership to support free shipping and called it Amazon Prime.

Amazon became sticky. Also people could instantly compare prices when they window shopped brick and mortar and bought on Amazon.

Rest is of course history.


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