Why is Amazon such a successful company? They are great examples of smart managerial economics at work. Amazon has identified goals that they want to achieve and the different constraints that they are under to reach those goals. They understand the concept of opportunity cost. They could be taking the time and money that is currently invested in training employees in customer service and apply it elsewhere. Amazon is successful because they are accomplishing their goals by following “The Amazon Doctrine” which is, “Above all else, align with customers. Win when they win. Win only when they win.”
Amazon has realized that customers are linked directly to their bottom line by way of “consumer sovereignty”. Amazon has realized what consumers want. Consumers are looking for quality products, cheap prices, accessibility and customer service.
From a personal perspective, Amazon followed their “doctrine” to the letter. My wife and I ordered a game online. We were super excited for it to arrive, but when it did, the package on our doorstep was opened and nothing was inside. We called UPS, but they couldn’t help us. We then called Amazon and they went to great lengths to make sure I was a satisfied customer. They sent me a new game and also refunded my purchase. On that day I won and according their doctrine when I win Amazon does as well. Because of this I will continue to shop on Amazon.
This is the link to the article I read.