The way Amazon has profited from the Covid-19 crisis is simply another example of how — in just a quarter of a century — its tentacles have insidiously coiled themselves around virtually every aspect of our lives
In the week I spent reading this account of how Amazon came to be valued at $1 trillion, making its founder Jeff Bezos the world’s richest man, my family of four spent a total of £86.82 at Amazon on—variously—computer paper, lawn fertiliser, guitar picks, bin liners, a film rental and an e-cookbook (the last, a bargain 99p).
Over lockdown, we’ve spent hundreds more pounds on esoteric items, watched hours of television via our Amazon Fire TV stick and read dozens of books on our Amazon Kindles. Should the government ever make good on its promise of home coronavirus antibody kits then Amazon—rather than the unreliable Royal Mail—will be the deliverer of choice.
One-fifth of the world’s population (and mainly from its richest nations) are housebound and more in thrall than ever to Bezos, who, while bricks-and-mortar businesses everywhere are felled by Covid-19, has recently seen his net worth increase by $24 billion, of which just $100 million has to date been donated to coronavirus-related charities.
To fulfil the needs of a quarantined world, Amazon is in the process of hiring 175,000 extra workers. Yet existing staff have complained of insufficient protective gear and a refusal to pay sick leave—allegations strongly denied.
Obviously, no one predicted a global pandemic when Brian Dumaine, the global editor of Fortune magazine, began writing this book. But the way Amazon has profited from the greatest crisis of our lifetimes is simply another example of how—in just a quarter of a century—its tentacles have insidiously coiled themselves around virtually every aspect of our lives.
Criticisms of the company have buzzed ineffectively for decades, perpetually swatted down by the argument that so long as Bezos’s driving philosophy of making customers lives “cheaper and easier” is upheld, then nothing else matters.
If Amazon’s workers were paid more and treated better (bizarrely, given the company employs 750,000 people, Dumaine’s interviewees are, at best, lukewarm about their employer), then goods would be more expensive, then customers would be unhappy, which is unthinkable.
It’s an argument Bezos applies to everything, from tax avoidance (the company paid just 1.2 per cent tax last year, compared to an average American’s 14 per cent) to its uninspiring environmental record, and one that Dumaine parrots frequently, with little regard for nuance.
Awestruck as the author appears (“Compared to a traditional business, Amazon is an F-22 Raptor stealth fighter jet in a dogfight with a World War I biplane,” he gushes), he also seems strangely incurious about the motivations of Bezos himself. Despite his fascinating origins as the son of a 17-year-old schoolgirl and 18-year-old unicyclist, he comes across as a cipher, who left his lucrative hedge-fund job in 1994 to found what was initially an online bookshop (during the pandemic Amazon has de-prioritised book orders as “non-essential”).
We learn that his company is “a place where intensity and drive are expected and complacency is strictly taboo”, but such clichés give us zero insight into why Bezos is so intent on crushing anything in his path.
More interesting is learning that this crushing has been achieved through adopting the “flywheel” approach of leadership guru Jim Collins. The company is viewed as a cycle, with a good customer experience leading to more traffic, which leads to more sellers and buyers using the site, which leads to more products being sold, which takes us full circle to an improved customer experience.
By that token, everything Amazon introduces—from our Kindles, our Fire sticks, free same-day deliveries, Prime shows such as the Emmy-winning The Marvellous Mrs Maisel, to the overpriced Whole Foods stores—exists only to suck customers in deeper, thereby making the wheel spin so rapidly that competitors stand no chance. Whenever Amazon spies new pastures—banking, technology, health care, courier services—former giants must brace for a war to the death.
Dumaine’s book does contain a handful of fascinating insights, for example into how Amazon has destroyed small businesses that were selling on the platform by spotting their high-selling products before using its data—such as the factories used and shipping costs—to create own-brand cheaper versions (Amazon denies this but the evidence is compelling).
As an anti-China backlash grows, Dumaine reveals how vast numbers of Chinese sellers on Amazon fake reviews and hack competitors’ pages to siphon their sales and data. Also hugely pertinent are his musings into whether Amazon’s growing use of robots and Artificial Intelligence will lead to mass unemployment and the introduction of a Universal Basic Income.
It’s depressing to read of Bezos’s domination and even more depressing to realise that, while writing this review, I made an Amazon detour to order novels for my daughter. I could have found an alternative seller, but—as all of the UK’s 15 million Prime subscribers know—the books would probably cost more and arrive later. As Dumaine puts it, defending such monopolies, “People like what [Amazon] offer . . . Bezonomics is here to stay”.
Bezonomics: How Amazon Is Changing Our Lives, and What the World’s Companies Are Learning from It
By Brian Dumaine
Simon & Schuster, 336pp, £20
This article is taken from the May/June 2020 issue of Standpoint. To subscribe to the print and digital editions, including a full digital archive, click here.