The Best Parts of Amazon's 2017 Letter to Shareholders
Have you seen the 2017 Letter to Shareholders? It’s especially noteworthy this year since it marks the 20th anniversary of the first one being sent. Amazon Founder and Chief Executive Officer, Jeff Bezos, included the original letter while focusing on all of the milestones associated with what is happening today.
If you have time, it’s definitely worth reading the entire letter but if you just want a quicker overview here are the important points.
Customers Are Satisfied
Amazon.com, Inc. ("Amazon") has evolved over the years and one thing we know for sure is that people love it. Whether it’s in the United States or the United Kingdom, customers consistently rank Amazon #1 in terms of satisfaction. That’s incredible!
Bezos believes that this is because, in this age of technology, customers are empowered and push companies to deliver at levels we’ve never seen before. He credits the hard work and passion of the more than 560,000 Amazon employees for helping make this happen.
High Standards Are Key
“We’ve had some successes over the years in our quest to meet the high expectations of customers,” wrote Bezos. “We’ve also had billions of dollars’ worth of failures along the way.” Digest that for a moment. Amazon’s leadership has been shaped by losses on a massive scale. Thanks to this, Bezos has some wisdom to share.
In his eyes, high standards have four elements — they are teachable, domain specific, recognizable and must explicitly coach realistic scope. In the letter, he provides great insight about what this means for Amazon as a whole and how to best meet customer expectations.
Power of Prime
After 13 years, Amazon has more than 100 million paid Prime members worldwide. In 2017, more members joined than ever before, the service area has been expanded and this has resulted in more than five billion items being shipped with Prime during the past year alone.
In addition to continuing success of its music service, Prime Video has produced award-winning content such as the series, The Marvelous Mrs. Maisel, and the film, The Big Sick, while expanding its lineup and committing over $18 million in royalties to independent filmmakers and other rights holders.
Amazon devices such as Echo Dot, Fire TV Stick and Kids Edition Fire Tablets sold better in 2017 than ever before and, in some cases, saw sales that were double compared to the previous year.
Alexa continues to grow and now includes more than 30,000 skills allowing users to use it to control over 4,000 smart home devices. The development team continuously finds ways of improving customer experience and software performance.
Whole Foods Acquisition
The Whole Foods acquisition has facilitated the combination of the company’s existing high-quality, natural and organic food offerings with the convenience and affordability associated with Amazon. It’s truly a win-win situation.
Additionally, customers can now purchase some Whole Foods products on Amazon and some Amazon products, such as the Echo, in-store at Whole Foods. The partnership continues to evolve but the end goal is the same – a better shopping experience for loyal customers both companies.
Empowering Small Businesses
For the first time in history, in 2017 more than half of the units sold on Amazon worldwide were from third-party sellers, including small and medium-sized businesses. That’s truly remarkable!
According to the Letter to Shareholders, “SMBs selling on Amazon come from every state in the U.S., and from more than 130 different countries around the world. More than 140,000 SMBs surpassed $100,000 in sales on Amazon in 2017, and over a thousand independent authors surpassed $100,000 in royalties in 2017 through Kindle Direct Publishing.”
Amazon is committed to being efficient in every way possible in order to minimize carbon emissions. The long-term goal, according to Bezos, is to power their “global infrastructure using 100% renewable energy.”
To date, they’ve launched wind farms, implemented plans to host solar energy systems and, in 2017, celebrated the 10-year anniversary of Frustration-Free Packaging. Incredibly, Bezos also revealed that Amazon’s “renewable energy projects now produce enough clean energy to power over 330,000 homes annually.”
Innovation, Milestones and Commitments
Bezos touched on many other areas in the Letter to Shareholders but the prevailing message was that Amazon is committed to innovation and strives to be better every day. As he wrote, “Once you’ve tasted high standards, there’s no going back.”
Some of the other milestones addressed in the letter include the growth seen within Amazon Music and Amazon.in (the fastest growing marketplace in India), the strides Amazon has made in the fashion industry, the expansion of Treasure Truck and the introduction of AmazonGo.
Overall, the 2017 Letter to Shareholders is overwhelmingly positive and provides an incredible look back over the company’s past 20 years. It’s absolutely worth reading and will make you feel proud to be part of this ground-breaking company!
Originally published on May 18, 2018, updated February 25, 2019
This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.