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Bezos on Persistence, Patience, Customer Focus

dlifson — Mon, 13 Oct 2008 12:25:27 +0000

Of the many reasons to admire Jeff Bezos, top billing goes to his unwavering long term vision. Here’s some quotes from this weekend’s NY Times article contrasting Amazon and eBay:

“Our willingness to be misunderstood, our long-term orientation and our willingness to repeatedly fail are the three parts of our culture that make doing this kind of thing possible,” he said.

And here’s another:

We are willing to plant seeds that take five to seven years to grow into reasonable things,” he said in an interview. “You can’t do big, clean-sheet invention unless you are willing to invest for long periods of time.”

And one more:

“At the end of the day, we believe it’s good for all of our sellers to make sure we are protecting the consumer experience first,” Mr. Bezos said. “Our first and foremost goal is to earn trust with consumers. If there are no consumers buying, nothing else matters.”

The rest of the NYT article outlines how far eBay has fallen. eBay had short-term focus (quarterly results) and fell into the innovator’s dilemma because they were held hostage by the hostility and vested interests of their sellers. Consider this quote, via Om Daily:

How bad? The sellers — aka the customers of eBay — are so mad that they are putting out statements publicly denouncing the company. Professional eBay Sellers Alliance (PESA) on its web site wrote:

In the first nine months of 2008, we have observed a substantial deterioration in the value of the marketplace for merchants. Broader e-commerce growth is in the high teens while eBay’s GMV has increased at low single digit rates; a clear sign that eBay is losing wallet share among online shoppers.

Today eBay merchants have an increased level of business uncertainty due to eBay’s poor execution of changes in many areas including seller performance measurement, fees, site search, buyer activity, and seller communication. The result is that merchants are changing their behavior in ways that we believe is not beneficial to the eBay marketplace.

Merchants are pursuing alternate channels for their businesses which are more economical, including launching their own website, participating in other third-party channels such as Amazon and Overstock, and even opening brick and mortar stores.

Whichever way you look at it, that is a big fat F for the company. I think buying new companies might give eBay a near-term lift, but the business is a bureaucratic mess and as a company eBay has had trouble coming to terms with the future. It has failed the innovation test — a metric almost every Silicon Valley company should be judged by — and all it has done is use its monopolistic position to paper over its shortcomings.

When you’ve got buyers needs in one ear and sellers screaming their needs in the other ear every day, you find yourself constantly tested – do you have enough persistence, enough patience, and enough customer focus to succeed?

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Tags: amazon, ebay

Mob mentality on IMDB

dlifson — Tue, 29 Jul 2008 13:06:39 +0000

I saw this post about IMDB as I was perusing Techmeme last night. Wow, talk about a tough situation – the new Batman movie gets voted up to #1 movie of all time even though it clearly is not deserving. Similarly, the long standing #1 – The Godfather – actually is getting voted down. What can you do? The community has been taken over by biased participants and agitators.

The holy grail is to build the perfect reputation system, where you count votes in relation to the voters “reputation”, but that is impossible to define. A reasonable alternative might be to take a cue from Wikipedia and lock voting for the Dark Knight (and possibly the top 5 movies). When Wikipedia articles are getting vandalized or constantly being fought over by various factions, moderators can come in and lock an article until emotions cool. Considering that movies have a strong temporal aspect to them – how many people will be talking about this summer’s blockbuster over Thanksgiving dinner – locking voting on the movie might do the trick. If the movie is unlocked after several months, truly passionate fans can go back and vote for their favorite movie, but the mob energy will be much more difficult to recreate. As to fixing the current vote tallies, I’m not sure. Reverting votes could result in an even more significant and wide spread backlash from the community. My recommendation would be to leave votes as they are and count on your loyal fanbase to reset the rankings to their appropriate levels. Good luck, IMDB.

Mashable gets it right – UGC goes beyond User created content

dlifson — Sun, 28 Oct 2007 20:44:10 +0000

The User-Generated Content Reality

Mark “Rizzn” Hopkins gets it right – there is more to User Generated Content than content that users explicitly create. Web 2.0 includes what Read/WriteWeb calls the “Implicit Web” – people’s clickstream, searches, and purchasing behavior. This, of course, is what we at Amazon.com’s Personalization team have been doing for almost a decade.

At Amazon.com, we have a popular feature called “Customers who bought this also bought”. This feature could not exist in any form without customer actions, which makes it (IMO) User Generated Content. Now, it’s not User Created Content, like customer reviews are, but the product relationships are certainly generated by users.

More Amazon.com examples – Personalized Recommendations, Behavior-based search, Top sellers lists, Personalized ads.

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Tags: amazon, web 2.0, implicit web, personalization

Mashable has lame Facebook wish list

dlifson — Sat, 27 Oct 2007 17:47:27 +0000

Facebook Wish List: Five Apps I’d Actually Like to See

Sorry, but I think there is a serious disconnect between what Mark “Rizzn” Hopkins wants and what most Facebook users would want.

A podcast client? How many people know what a podcast is?

A Top 40 list? We know now that most adds are from the Profile box. So again, most users won’t care what’s in the app directory.

A PR Connection Tool? Right, because everyone needs to initiate a little PR.

IRC and FTP clients? How many people still use those? Way back when, Facebook launched a P2P media sharing client named Wirehog, which was a total disaster. I’m not convinced an FTP client would do better.

I admit I actually have no understand of his 5th wish list idea, so I won’t comment. I think he’s trying to describe Ning.

My top 5 wish list

1. A personalized version of Google News, taken from the shared items posted from your Friends.

2. Tagging of friends. This is something suspected is in the works. I want to be able to send messages or invites only to certain friends.

3. OpenID for all facebook users. Every facebook user should be able to easily link their Facebook account with their Amazon or eBay or Paypal or Skype accounts. E-Commerce has a large role to play in Facebook, and lining up who you are in facebook to who are you in Skype is crucial.

4. Stronger integration with local Neighborhoods. So yes, there are a few Neighborhood apps, but Facebook would be well served by growing the connectedness of a geographic community. Want to throw a party for the neighborhood? Find playmates for your kids? Tell your neighbors to look for your lost cat? The internet can help counteract what Robert Putnam describes in Bowling Alone.

5. A real email client. Sure, there is Facebook messaging, but what Facebook really should do is build Gmail right into Facebook. They could easily tack on features found in Xobni and Twine, and you’d get a heck of an email application.

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Tags: facebook

Facebook, the platform – a nightmare.

dlifson — Mon, 16 Jul 2007 00:48:40 +0000

I’ve been thinking about writing this post for a few weeks now, and have finally decided to do so now that a number of posts are coming out about Facebook replacing email.

Facebook has the potential to replace a lot more than just email.

Facebook could be the next Internet platform. One built upon interconnected social networks.

How about:

classifieds (Craigslist)
used and new products (Ebay)
personalized start pages (Netvibes)
social bookmarking (del.icio.us)
video (YouTube)
news aggregators (Digg)
search engines, except the one inside Facebook

That scares me. Why? Because it’s a black hole – what goes in doesn’t come out.

Data is everything. If you own it (and have a LOT of it), you have a HUGE advantage. Just look at what Amazon can do with it’s recommendations.

Social networks, because of the network effect, are winner take all markets. Move everyone to the platform, build all of the apps on top, add trust, filter out all of the crap/spam, and you’re left with an Internet sized bundle of content with nothing but good stuff.

Which is wonderful, except the lock-in part. Facebook shouldn’t own all of the data built on top of it.

Do you trust Facebook?

Solar power supplements

dlifson — Mon, 05 Mar 2007 04:56:09 +0000

Solar powered data centers

Now that’s a good idea. One of the biggest costs for any large internet company is cooling and powering their datacenters. Why not use free, clean, sustainable energy as a way to reduce costs? Amazon’s largest fulfillment center, based in Coffeyville, KS, is 750,000 square ft and has a flat roof. If we just covered that roof with solar paneling, I would think we could generate a noticeable amount of energy. Kansas gets a fair amount of sunlight as well. Our fulfillment center in Reno, Nevada would also be an excellent candidate. Although our datacenters are on the east coast, which is less ideal for solar paneling, using this kind of technology to reduce costs might make the idea of creating a datacenter in the Southwest or California more appealing.

PS – Google announced that becoming carbon neutral is a company goal. Why not Amazon?