A far cry from the glossy Silicon Valley giant it's become, Amazon started life in the garage of founder Jeff Bezos’ home in Washington State. Bezos, a former hedge fund manager, quit his job on Wall Street in 1994 with the aim of taking advantage of the internet revolution by setting up his own online bookstore.
Amazon was originally called Cadabra, as in ‘Abracadabra’, but the name was scrapped after several people misheard it as 'cadaver'. Other proposed names included MakeItSo.com (after Captain Picard's frequent command in Star Trek), Awake.com, Browse.com, Bookmall.com and Relentless.com. In the end, Bezos chose Amazon to suggest scale (Amazon launched with the tagline 'Earth's biggest book store') and because website listings at the time were alphabetical. The site was officially launched on 16 July 1995.
Originally, the website only sold books. But because of a lack of space, Amazon had no inventory. When an order came in, staff would find the book online, ship it to the Amazon office and then repackage it before sending on to the customer. The first book Amazon.com ever sold was Fluid Concepts & Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought.
During Amazon’s first month in business, it received orders from customers in 45 countries across the world. The office had a bell installed that would ring every time someone made a purchase. Within a few weeks, sales were happening so frequently that they had to switch it off. To keep overheads low, the office desks were made from cheap doors, with sawn-off two-by-fours for legs (pictured). The company still reportedly hands out a Door Desk Award to employees who implement thrifty ideas.
In the company’s first year, Bezos cheekily hired mobile billboards to drive by Barnes & Noble stores displaying the question 'Can't find that book you wanted?' along with Amazon's website address. That wasn't the start-up's only run-in with the bookseller either. In 1997, Barnes & Noble sued Amazon, alleging that 'Earth’s Largest Bookstore' was a false claim. It eventually settled out of court with Amazon continuing to use its slogan.
In the early days of Amazon, its offices and warehouses were one and the same thing. But as the company grew it began to open dedicated warehouses, which it calls fulfilment centres, the first of which were located in Seattle, Washington and New Castle, Delaware and opened in 1997. Today there are more than 185 fulfilment centres across the world. When Amazon purchased robot manufacturer Kiva Systems for $640 million (£494m) in 2014, its warehouses gained a new type of worker: robots. Pictured here, these small robotic devices lift up shelving units full of products, moving via QR codes on the floor which they scan using cameras.
In 1998 the company was dramatically under-staffed for the Christmas holiday season rush. It’s reported that every employee had to take a graveyard shift in the fulfillment centers to meet demand, with many bringing their friends and family in to help too. To ensure that doesn’t happen again, Amazon now hires a record amount of staff over the holiday season. Last year, it created around 200,000 seasonal positions across its US network of fulfillment and sorting centers, and in 2020 plans to hire 100,000 seasonal workers in the US and Canada alone.
You might be surprised to learn that Amazon is thought to be the largest apparel retailer in the US, according to estimates by Morgan Stanley and Wells Fargo – although the company hasn't disclosed its fashion sales figures. Its acquisitions of online fashion company Shopbop in 2006 and online shoe store Zappos in 2010, along with its own fashion brand Find, have helped it to gain a foothold in the online fashion marketplace.
Not content with changing the way we buy books, in November 2007 Amazon launched the Kindle e-reader, allowing people to download books and read them all on one compact device. Initially on sale for $400 (equivalent to $500 or £377 today), some reviewers criticised its high price, although that didn't stop it selling out in a reported five and a half hours. The Kindle has undergone a transformation over the past 13 years, doing away with the keyboard from earlier models and opting for touchscreen, launching a frontlight feature and improving the resolution of the display. Today you can buy a Kindle from around $89.99 (£69.99).
In September 2011, Amazon launched its first ever tablet: the Amazon Kindle Fire. Positioning itself as a competitor to the Apple iPad, the first model was completely touch-screen and retailed at $250 (£189). Although Amazon didn't share its sales figures, a Barclays analyst predicted 5.5 million of the devices were sold in the final quarter of 2011. In 2014, Amazon launched the Fire Stick, a device which plugs into your TV allowing users to stream content, designed to compete with Google's Chromecast and Apple's Apple TV, and in January this year its Fire TV platform reached 40 million active monthly users.
Despite Amazon's tech success, its attempt to release a smartphone was disastrous. In July 2014 the company launched the Amazon Fire phone, originally priced at $199 (£150) (with a two-year contract). Yet within just three months, AT&T dropped the price from $200 to just 99 cents with a two-year contract. Just three months later, Amazon took a $170 million (£128m) write-down charge to wipe out the lost value of unsold Fire phones. The phone was criticised for not having major apps including Google Maps and Starbucks, as well as hooking users directly into Amazon's shopping engine. After just over a year, Amazon stopped selling the Fire phone.
Amazon is now challenging Netflix in the battle for video streaming subscribers, with its Amazon Prime Video service. Launched in the US in 2006 as Amazon Unbox, it expanded in the 2010s, reaching the UK, Germany and Austria in 2014. In fact, after live-streaming Premier League football matches it became the fastest-growing streaming service in the UK earlier this year. Amazon is predicted to spend around $7 billion (£5.4bn) on creating original content this year, although that's significantly lower than Netflix's reported $16 billion (£12.3bn) original content budget. Among its most popular and longest-running shows is detective show Bosch, which premiered in February 2015.
Amazon launched its first voice assistant device, the Amazon Echo speaker, which uses the Alexa voice assistant, in November 2014. Despite some criticism from reviewers, people snapped it up and in January 2019 it was announced that more than 100 million Alexa-compatible devices had been sold. In 2018, a survey by digital marketing firm Code Computerlove found that 20% of UK smart speaker owners had asked their voice assistant how to boil an egg. Other frequently asked questions included asking what the weather is like and requesting to play a song.
Adding another string to its bow, Amazon launched its hotly-anticipated Amazon Fresh grocery delivery service in June 2016, promising "everything you need for your weekly shop". The service, which is available to Prime members for free in some parts of the US, allows shoppers to browse fresh produce, meat, seafood and household essentials and have it delivered within a two-hour delivery slot.
In 2017, Amazon made its biggest purchase to date when it bought Whole Foods for $13.4 billion (£10.3bn), with the aim of selling fresh produce for cheaper prices. The e-commerce giant has already pushed ahead with changes to the retailer, bringing down the price of some staple products and introducing the Amazon Echo to shelves. However, the move has come with criticism that Whole Foods has sold out to "one of the most disliked companies in retail".
In January 2018 Amazon opened its first checkout-free Amazon Go grocery store in Seattle, a "Just Walk Out" store that means you don't need to queue for a cashier, but just pick up your purchases and leave. Using sensors and weights which are connected to a virtual cart in the Amazon Go app, the stores could revolutionise how we shop. There are 26 stores across the US already, and in February this year, Amazon opened its first full-size, checkout-free Amazon Go supermarket in Seattle. The 10,400-square-foot (966-square-metre) store is much bigger than the convenience store-style of the previous Amazon Go sites, and many believe that if a success Amazon-owned Whole Foods will be the first to adopt the technology.
In June, Amazon announced it would be acquiring self-driving car start-up Zoox in a deal that's thought to be worth $1.2 billion (£918m). Zoox builds its vehicles from scratch rather than creating them from traditional cars, and it plans to create a vehicle that can drive backwards and forwards without turning. Things may move fast for its latest acquisition as Zoox received a permit to test driverless cars without a back-up driver in California this September. On top of this, Amazon has invested into self-driving car start-up Aurora and driverless truck company Embark has been seen carrying Amazon's products.
Due to the coronavirus pandemic Amazon's annual Prime Day, a 48-hour shopping event, was postponed from July 2020 to October. However, COVID-19 didn't impact sales. Amazon sold $10.4 billion (£7.8bn)-worth of goods, 45.2% higher than 2019's extravaganza, according to Digital Commerce 360's analysis. Amazon also sees mega sales on Cyber Monday, the online shopping day after Black Friday: in 2019, Amazon raked in a record $9.4 billion (£7.2bn) in sales, up nearly 19% on the previous year, with an incredible $11 million (£8.5m) being spent per minute during the peak hour. This year it will take place on 30 November.
Amazon currently has over 150 million paying Prime members worldwide. Based on the latest survey in March 2019, the average Prime member spent a whopping $1,400 (£1,072) each.
Amazon CEO Jeff Bezos has seen his net worth skyrocket in recent months, thanks to heightened demand for Amazon products and soaring stock prices during the pandemic. In August, he became the first person in the world to have a net worth above $200 billion (£153bn), according to Bloomberg's Billionaires Index. His net worth has dipped slightly since then and at the time of writing (10 November), he's estimated to be worth $184.4 billion (£139bn).
Amazon has a 14% share of the global retail market, as well as accounting for over 50% of all retail sales in the US. However, based on current trends Amazon could surpass the world's largest retailer Walmart soon. It's thought that Amazon's sales are vastly underestimated, due to the fact that products sold by third-party sellers are only recorded in terms of the commission, fulfilment and shipping fees. According to one analyst, this would mean that the value of all services and products traded on Amazon was around $600 billion (£460bn) in 2019. Amazon hit headlines in February this year when it gained a $1 trillion (£766bn) valuation. It's actually the fourth company to do so: Apple hit the landmark in August 2018 while Microsoft reached it last year and Alphabet, Google's parent company, did so in January. At the time of writing (10 November), Amazon is valued at $1.58 trillion (£1.2tn).
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