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THE STORY BEHIND THE APP Amazon

JACKSON PETERS

MASON CREST MIAMI

Mason Crest PO Box 221876, Hollywood, FL 33022 (866) MCP-BOOK (toll-free) • www.masoncrest.com

Copyright © 2024 by Mason Crest, an imprint of National Highlights, Inc. All rights reserved.

No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, taping, or any information storage and retrieval system, without permission from the publisher. First printing 9 8 7 6 5 4 3 2 1 ISBN (hardback) 978-1-4222-4775-4 ISBN (series) 978-1-4222-4773-0 ISBN (ebook) 978-1-4222-7040-0 Library of Congress Cataloging-in-Publication Data Names: Peters, Jackson, author. Title: Amazon: the story behind the app / Jackson Peters. Description: Hollywood, FL: Mason Crest, [2024] | Series: Tech titans | Includes bibliographical references and index. Identifiers: LCCN 2023014382 | ISBN 9781422247754 (hardback) | ISBN 9781422270400 (ebook) Subjects: LCSH: Amazon.com (Firm) | Internet marketing. | Application software. Classification: LCC HF5548.32 .P473 2024 | DDC 658.8/72--dc23/eng/20230705

LC record available at https://lccn.loc.gov/2023014382 Developed and Produced by National Highlights, Inc. Editor: Andrew Luke Interior and cover design: Tara Raymo • CreativelyTara Production: Crafted Content LLC Publisher’s Note: Websites listed in this book were active at the time of publication. The publisher is not responsible for websites that have changed their address or discontinued operation since the date of publication. The publisher reviews and updates the websites each time the book is reprinted.

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CONTENTS

Chapter 1: Story of a Startup . ................................................ 7 Chapter 2: Rise to the Top . .................................................... 21 Chapter 3: Market Domination . ..................................... 33 Chapter 4: Beyond the Boardroom . ........................... 47 Chapter 5: On the Horizon ............................................. 61 Series Glossary of Key Terms . ....................................... 74 Further Reading . ................................................................. 76 Internet Resources ......................................................... 77 Index . ............................................................................... 78 Author’s Biography & Credits . ................................... 80 KEY ICONS TO LOOK FOR:

Words to Understand: These words with their easy-to-understand definitions will increase the reader’s understanding of the text while building vocabulary skills. Sidebars: This boxed material within the main text allows readers to build knowledge, gain insights, explore possibilities, and broaden their perspectives by weaving together additional information to provide realistic and holistic perspectives. Educational Videos: Readers can view videos by scanning our QR codes, providing them with additional educational content to supplement the text. Examples include news coverage, moments in history, speeches, iconic sports moments, and much more! Text-Dependent Questions: These questions send the reader back to the text for more careful attention to the evidence presented there. Research Projects: Readers are pointed toward areas of further inquiry connected to each chapter. Suggestions are provided for projects that encourage deeper research and analysis. Series Glossary of Key Terms: This back-of-the-book glossary contains terminology used throughout this series. Words found here increase the reader’s ability to read and comprehend higher-level books and articles in this field.

electronic: of, relating to, or utilizing devices constructed or working by the methods or principles of a branch of physics that deals with the emission, behavior, and effects of electrons distribution: the act or process of giving out or delivering something technological: of, relating to, or characterized by the practical application of knowledge, especially in a particular area warehouse: a structure or room for the storage of merchandise or commodities WORDS TO UNDERSTAND

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chapter 1

STORY OF A STARTUP

Today, the Internet is as integral to daily life in America and much of the world as electricity. There is an entire generation that has come of age not knowing a world without it even though it is a relatively recent phenomenon. It didn’t become a part of most people’s lives until the 1990s. At that time, companies began selling products online, which quickly became a popular way of shopping. Since it was still a new trend, most companies kept their physical stores built out of bricks and mortar in addition to their online stores. In 1994, Jeff Bezos started a different kind of business, Amazon.com, which began as a digital bookstore. Unlike other companies, Amazon had no physical store where people could go inside a building and look at the books lined up on shelves. Instead, every book Amazon sold had to be bought online. What began as a simple online bookstore eventually blossomed into one of the largest online stores of any kind. Customers from all over the world can now purchase all sorts of products from Amazon.com, ranging from books and clothes to food and health care products. However, the company never forgot its roots. Books have always been one of Amazon’s top priorities.

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Jeff Bezos’ big ideas have changed how people shop for the things they need. Today, Amazon is one of the most successful businesses on the Internet, but the company had humble beginnings.

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AMAZON

Before Amazon, most books were purchased in bookstores, but Bezos’ website allowed customers to order books online, which opened a whole new world of possibilities for people around the world. Shoppers no longer had to depend on their local bookstores to get them the books they wanted. They didn’t have to use mail-order catalogs for hard-to-find books either. Where once book buyers would have had to wait for a week or more for books to be shipped to them, now customers could receive a book ordered through Amazon.com more quickly. Amazon is successful for many reasons, but one of the most important is its ability to adapt to a changing world. The future of products will continue to change with the digital age, and companies will need to continue to adjust as Amazon did in order to be successful.

When Bezos started Amazon, few people used the Internet for shopping. Amazon helped to change the way people thought about shopping online.

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Story of a Startup

STARTING UP One of the best words to describe Jeff Bezos is innovative. Innovative people see a changing world and develop new ideas or methods to fit into that world. In the early 1990s, the world’s use of computers was growing fast. Personal computers, which had once been very expensive, were now becoming more affordable for everyday people. By the middle of the 1990s, almost everyone had a home computer. Bezos saw a great opportunity and knew it was only a matter of time before other people saw it, too. If he was going to take advantage of this moment, he would have to act fast. Bezos’ willingness to try new things started when he was still young. He was born on January 12, 1964, in Albuquerque, New Mexico, to a teenage mother, Jacklyn Gise Jorgensen, and his biological father, Ted Jorgensen. His parents were married less than a year, though, and when Jeff was four years old, his mother married Mike Bezos, a Cuban immigrant. As a child, Bezos wanted to understand how things work. He turned his parent’s garage into a laboratory and was constantly building electrical contraptions around his house. Later, as a teenager, he developed a love for computers. His family moved to Miami, Florida, where Bezos did well in school. In high school, he started his first business, the Dream Institute, an educational summer camp for fourth, fifth, and sixth graders. He graduated as the valedictorian of his senior class. When Bezos went to college at Princeton University, he decided to pursue his interest in computers there. He graduated with honors in 1986 with degrees in computer science and electrical engineering. After graduation, he found work in the business world on Wall Street. Eventually, Bezos ended up at the investment firm D. E. Shaw,

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MAKE CONNECTIONS The part of the url that comes after the dot is called the top level domain. When you see “.com” as the top level domain, it is short for “commercial.” Although most commercial sites in the US and many around the world do use this domain, a site does not necessarily need a commercial purpose to be a .com. It is available to any entity or person, and is therefore a popular catch-all and the go-to domain for American websites. Other common website endings include “.edu” (education) for schools and colleges, “.gov” for government organizations, “.org” for non-profit organizations, and “.net” for network resources. where he met his future wife, Mackenzie. In 1990, he was named the youngest vice president at the firm. Bezos took a huge risk when he decided to leave his job at the investment firm, but he knew he needed to devote himself full-time to his new project if it was going to be successful. His college background meant he was already very skilled at managing websites, and building a website that would allow users to buy products would not be hard for him. Learning how to run a business, however, was something entirely new to him. THE BEGINNING There are a lot of decisions to be made while starting up a new business. One of the first challenges Bezos faced was choosing what to sell. He hoped to sell all sorts of products one day, but choosing one product to start out with made better business sense as selling

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Story of a Startup

While bookstores have a limited amount of shelf space for books, Amazon can offer an almost endless number of titles for customers to search through.

everything at once would be far too difficult. Bezos came up with five products he thought would sell well online: compact discs (or CDs), computer hardware, computer software, videos, and books. Books seemed like the perfect place for Bezos to start. Even the largest bookstores at the time could only hold a certain amount of books. Customers looking for a less common book would need to ask the bookstore to order it for them. Buying books online offered a faster, and sometimes cheaper, alternative. Best of all, customers wouldn’t have to wait for a store to be open to do it. They could log on to a website at all hours of the day and night and buy a book instantly. Bezos envisioned his website selling every book a customer would ever want.

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AMAZON

From startup to success, check out this quick look at the history of Amazon.

The second choice Bezos needed to make was to decide where he would start his business. He had lived in New York before he quit his job, but Bezos needed to find a location near a warehouse that sold and shipped all kinds of books to retail bookstores, so he could send the books straight to customers in record time. The West Coast of the United States seemed like a great place to settle down. Plenty of other technological businesses were opening up there, which led to a part of Northern California becoming known as Silicon Valley (Silicon is a type of metal used in electronic chips). At first, Bezos considered Silicon Valley to be a great place to start a business that relied on the Internet, but he decided against it for tax reasons.

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Story of a Startup

One of the early hurdles in Amazon’s rise to success was finding enough warehouse space to keep up with customer demand.

Customers living in the state where an online business was located would need to pay sales tax. This meant Californians would be forced to pay more money for their purchases, while customers in other states would not have to. The state of California has a very large population, and Bezos feared he would lose many of his California customers to other businesses if he stationed his warehouse in Silicon Valley. Bezos began his search for another location. He finally settled on Seattle, Washington, a city located in the northwestern corner of the United States. Bezos hoped it would be the perfect location for his new business for two reasons: it was close to a large book

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Bezos decided to start Amazon in Seattle to base the company near an Oregon book distribution center. Bezos also had an easier time finding tech smart employees in Seattle as opposed to other locations.

distribution center in Oregon, and plenty of people who were trained in technology lived in the area. That way, Bezos would have no trouble finding employees to work for him. Starting a brand new business means taking a lot of risks. For Bezos, this meant packing his bags, saying goodbye to his life in New York City, and moving to Seattle to start his company. The drive took days, and Bezos spent most of his time on the road working on a business plan for his new website. He had already chosen a location and a market, but now, he needed to think of a name.

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Story of a Startup

A NAME TO DIE FOR Bezos thought of plenty of names before he finally chose the name “Cadabra,” which is a shortened form of the word “abracadabra,” the word sometimes used by magicians when they’re about to finish a trick. Bezos thought his website’s customers would be amazed by the new service, just like a magician’s talents amaze an audience. He settled on Cadabra as a good name for his new business, and Cadabra, Inc. was founded in July 1994. A lot of legal work goes into starting a business and building a website. Bezos started his company out of his home but kept in touch with a lawyer over the phone to get the legal aspects of his

Amazon is named for the massive South American river. Not only is it the largest in the world, but it also flows quickly and smoothly, like Bezos envisioned his business would.

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