The article in the url link below is a good story of a firm focused on implementing a stakeholder perspective and being rewarded for its efforts (Issues: Stakeholder Relations, p138). In a way that reminds me of Costco’s continuing ability to ignore shareholder demands for short term returns, Amazon has identified its key stakeholder group (its customers) and, as a result, places customer service as its number one priority:
“When I spoke to analysts and investors, they had all kinds of reasons for Amazon's performance last year. … But I couldn't help wondering if maybe there wasn't something else at play here, something Wall Street never seems to take very seriously. Maybe, just maybe, taking care of customers is something worth doing when you are trying to create a lasting company. Maybe, in fact, it's the best way to build a real business -- even if it comes at the expense of short-term results.”
The article quotes Jeff Bezos (Amazon’s founder and CEO):
“I believe that the success we have had over the past 12 years has been driven exclusively by that customer experience. We are not great advertisers. So we start with customers, figure out what they want, and figure out how to get it to them.”
What is encouraging is the firm’s willingness to stick to its beliefs, irrespective of shareholders’ short term demands (Figure 1.4: The Shareholder Shift—From Investor to Speculator, p14):
“Amazon has really had only one stated goal since it began: to be the most customer-centric company in the world. … Wall Street, however, has never placed much value in Mr. Bezos' emphasis on customers. What he has viewed as money well spent -- building customer loyalty -- many investors saw as giving away money that should have gone to the bottom line. … What Wall Street wanted from Amazon is what it always wants: short-term results.”
Amazon’s success, the article argues, was worth building and waiting for:
“Amazon says it has somewhere on the order of 72 million active customers, who, in the last quarter, were spending an average of $184 a year on the site. That's up from $150 or so the year before. Amazon's return customer business is off the charts. According to Forrester Research, 52 percent of people who shop online say they do their product research on Amazon. That is an astounding number.”
Take care
Dave
Bill Werther & David Chandler
Strategic Corporate Social Responsibility
© Sage Publications, 2006
http://www.sagepub.com/Werther
Put Buyers First? What A Concept
By JOE NOCERA
1843 words
5 January 2008
The New York Times
Late Edition - Final
1
http://www.nytimes.com/2008/01/05/technology/05nocera.html
