10 Things You Didn't Know About Amazon.com, Inc.
Despite the fact that millions of people purchase items from Amazon.com (NASDAQ: AMZN) every day, there are some interesting aspects to the e-commerce giant that many people are not aware of.
Here are 10 things about Amazon you may not yet know.
1. If not for its founder's desire to avoid regret, Amazon may never have existed
Jeff Bezos left investment firm D.E Shaw in 1994 to start Amazon.com, only months before he was scheduled to receive a guaranteed multi-million-dollar bonus. Why would he take such a risk? Bezos once told Motley Fool CEO Tom Gardner that he left to start Amazon because he was enticed by the astounding growth rates of e-commerce -- and did not want to miss out on what he (rightfully) believed to be an incredible opportunity.
Bezos lives his life by a "regret minimization framework," in which he makes big decisions according to how he believes he'll feel about them on his deathbed. Thus, he felt that not taking a chance on Amazon was actually the far larger risk.
2. Amazon.com was almost Cadabra.com
Bezos originally wanted to call the company "Cadabra," as in "abracadabra." But he quickly changed his mind when his lawyer thought it sounded like "cadaver."
Bezos also considered the name "Relentless.com." In fact, if you type that in your internet browser, it will take you to Amazon's home page.
Bezos finally settled on "Amazon" because he liked that the company would be named after the world's largest river, which fit well with its "Earth's biggest book store" tag line.
3. The meaning behind Amazon's logo
Amazon introduced its now familiar logo in early 2000. The smile is meant to represent the company's intense focus on customer satisfaction. And with the smile beginning at the letter "a" in Amazon and ending at the letter "z," it also symbolizes that customers can find nearly anything -- from A to Z -- on Amazon.com that they may be looking to buy online.
4. Amazon offers its customers an easy way to support their favorite charities
Another way Amazon injects grins into its business model is through AmazonSmile. By shopping at smile.amazon.com, you'll find the exact same prices, selection, and shopping experience as Amazon.com, with the added bonus that Amazon will donate 0.5% of the purchase price to your favorite charitable organization. You can choose from nearly one million organizations to support.
5. Amazon has a massive robot army...
The e-commerce titan uses more than 45,000 robots in its fulfillment centers to help it pick, sort, and ship goods faster. The robots are made by Kiva Systems, which was acquired by Amazon for $775 million in 2012.
6. ... but it still needs a legion of human employees
Even though robots are beginning to take over jobs that people used to do, Amazon still requires a massive number of actual humans to operate its business. In fact, the company is looking to hire more than 120,000 people in the U.S. for the upcoming holiday season.
7. Unfortunately, not all of these employees work out
Working at Amazon's fulfillment centers can be challenging, so much so that one unhappy worker decided to stage an unconventional type of protest, as described by Business Insider:
Perhaps unsurprisingly, this rebel employee was fired when he was eventually discovered, though his story remains cemented in the annals of Amazon history.
8. Amazon spends more on advertising than five of its major rivals combined
In addition to robots and employees, Amazon also spends a lot of money on ads. The company spent $7.2 billion on marketing in 2016, representing an increase of 38% compared to the prior year. That figure was more than Wal-Mart Stores, Target, Best Buy, Home Depot, and Kroger combined, even as these retailers collectively produced $800 billion of sales, compared to $136 billion for Amazon.
9. Why Amazon is constantly adding new features to Prime
One of Amazon's goals for its massive advertising investments is to grow its Prime membership base, which is estimated at around 80 million subscribers.
Why is this important?
The average Prime member spends $1,300 on Amazon's shopping platform every year, compared with $700 for non-Prime members, according to Consumer Intelligence Research Partners (CIRP). This helps to explain why Amazon is always adding new benefits to Prime.
10. The stock's incredible run is likely not over
The growth of Prime is one of the factors that have contributed to Amazon's incredible success. Other important drivers can be found in the company's valuable third-party merchant network and rapidly expanding Amazon Web Services division.
With these three powerful aspects of its business fueling its growth, Amazon appears poised to deliver even more gains to its shareholders. In fact, some investors believe Amazon will be the world's first $1 trillion company. And one respected venture capitalist thinks that Amazon could be worth as much as $3 trillion within the next decade. As such, investors who buy Amazon's stock even at its current lofty levels could be well rewarded in the years ahead.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends Home Depot. The Motley Fool has a disclosure policy.
