Amazon business plan

Web Strategy Case Studies:Amazon.com & RealNetworks

Anil Kumar

ISMC

Preparing Content for the Web

There are consumption pattern differences among readers of print and Web media

Print readers tend to read in a linear fashion Web surfers may interact with an article and

read elements out of order Non-linear “Branching”

Design Issues

Some content specialists argue that vital information should remain “above the scroll” on all pages

Thus, some suggest that you write in “chunks” delivered one page at a time

“Chunks” Strategy

Repurpose print materials into “chunks” that each have a unique page

Add graphics and interactivity Each “chunk” is usually fewer than 150 words Text can be viewed on the screen without

having to scroll This is only one strategy – many sites do not

use it!

Examples of “Chunk” Style

McDonalds Nike Keebler

Web Writing Tips

More casual than print Use bullet-point lists Minimize use of hypertext links All links should be relevant Provide feedback option for readers

Building the Site

Ideally, the Web site team consists of: Copywriter/editor Graphic artist Web programmer

A public relations professional who can do all three increases their odds of getting hired

Usability Tests

Before publicly launching your site, it is not uncommon to conduct “usability tests” with a test audience to determine if the site is easy to navigate

Overview of Web Strategies

Success Story at Amazon.com Evolution of a Design Personalization and Automation

Failure at RealNetworks Communication is Content Development Rolling Stone Radio project

Success Story

Amazon.com is the world’s largest e-commerce site

During the dot-com “boom,” they hired aggressively as investor cash came in

“Bloated” and inefficient site infrastructure The site needed to streamline its content

development strategy This included a shift from an editor-created to a

user-generated content model

Has over 35 e-commerce main product categories and hundreds of sub-categories Each category has at least one full-time editor

Some have several editors Each editor is responsible for maintaining front

page of each “store” and sub-pages, including product detail pages

Amazon.com Content Management

With millions of products, Amazon.com needs help from the public to keep the pages up-to-date and filled with useful information

“User-generated Content”

Amazon.com Content Features

Reviews Listmania “How-to” and Buying Guides Product manuals Customer Images Ref-tags Discussion Forums Wikis

Listmania! Examples

Customers create their own lists to share with others Each item in the list is linkable to a product

Examples: Top 15 Movies of 2005 by fattyjoe37 The Best Albums of 2006 by volantsolo “Awesome Books” by fantasyrules

Guide Examples

Customers create their own guides to share their expertise with others

Examples: How to set up a wireless home network Taking a better picture with your digital camera

Visitor Experience

Customers indicate that they enjoy the “community” aspect of shopping

They trust the collective opinions of other shoppers more than the manufacturers

The “Amazon Review” has become a very powerful force in the industry Buying decisions are made for purchases both

off- and on-line

Customer Reviews

Amazon.com has thousands of unpaid writers voluntarily submit their reviews Top reviewer Harriet

Klausner has written over 12,000 reviews without pay for the site

Personalization at Amazon.com

Amazon.com developed an infrastructure where each visitor page is personalized

The homepage displays items that Amazon.com thinks you are likely to buy

Visitors indicate that they like the personalization

Amazon.com Personalization

Personalization technologies are also easy to manage and popular with visitors Previous purchase data collected Cross-referenced with other sales data A “personalized” store homepage suggests

products based on like-minded customers Includes “recommendations” embedded into page

Automation at Amazon.com

Data is king at Amazon Many examples of data driven automation

Channel management Web site real estate management system Automated e-mail measurement and optimization

Merchandising Customers who bought X also bought… Recommendations New releases, top sellers Purchase Circles

Advertising Automatic ad generation and bidding

Example: The Amazon.com Homepage Amazon’s home page is prime real-estate

The past: Every category VP wanted top-center Friday meetings about placements for next week were

getting too long, too loud, and lacked performance data Today: automation replaces intuitions

Home page is made up of slots Anyone can submit content for a slot Content is chosen based on real-time

experimentation

E-Commerce Staff Structure

Organized for execution How it used to be

This works rather better Small, cross-functional teams Able to execute end-to-end Self directed Established group goals and measure progress

TechnologyPeople

BusinessPeople

“Dumb idea!”

“Do this!”

Electronic Media and E-Commerce

What makes the site attractive to consumers? Strong reputation for good customer service Secure from “hackers” Large selection of products Easy navigation

Clean Web design that maximizes click-throughs and/or sales

Amazon.com Design Evolution

Started with a few “tabs” representing each store But Amazon.com was expanding… More products = More “tabs” Should the “tabs” go?

Amazon.com Design Evolution

A new design was needed

Lack of action could mean a mountain of “tabs” NOT A GOOD

DESIGN

Design Evolution

Initial redesigns focused on an index directory in the style of Yahoo!

This resulted in reduced sales

Design Evolution

More redesigns in the index style

Sales still declined Customers wanted

the “tabs” back

Return of the “Tabs” Now only three tabs

“See all 35 Product Categories” Roll-over with mouse

brings up the index of all stores

“Your Store” Personalized store with

recommendations Logo tab

Default to front page

Lessons Learned

Use focus groups and user surveys to test out a design before it launches widely

Design can play a key role in how a site is perceived by its public

“Above the scroll” real estate is valuable so don’t waste it! A user should be able to navigate successfully

through the site without having the scroll the screen

Lessons Learned

Be aware of the bandwidth of your average user U.S. has shifted from a dial-up to broadband

environment Multimedia-intensive designs and sites are only now

gaining traction Your design strategy will depend on who your typical

visitor is Consider how minimal Google.com is Compare this to YouTube.com

Cost Efficiency

Advertise your site using viral and cheap techniques Amazon.com has stopped buying ads on

mainstream TV, radio and print in favor on online referral programs

Media advertising did not bring in enough revenue to justify the cost

The site uses promotions with other sites and “street” advertising to get word on in the influential communities

Communication is Critical

If there is a dependency on technology developers, then the content experts must communicate early…and often

A good project can fail due to poor communication

Anatomy of a Failed Project

Example: RealNetworks’ Rolling Stone Radio

Goal was to promote new “G2” technology A new version of

RealPlayer with optimized streaming media playback

RealNetworks

RealNetworks asked me to create a G2-exclusive Internet radio service

A business deal with Rolling Stone magazine was created

Rolling Stone Radio was born

Content Development

My background is in editorial development and the music industry

I led the creative team Design of the player Partnerships with music industry

Another team was responsible for the technical infrastructure and development of the software code

Rolling Stone Radio

Rolling Stone Radio was the first “mainstream” Internet music service

Introduced in 1999 Co-owned by RealNetworks

and Rolling Stone Multiple channels of music Interactive voting

Rolling Stone Radio

Featured celebrity deejays David Bowie had his own 24-hour channel

Lots of “hype” from the media

So Why Failure?

Rolling Stone Radio had all the ingredients for success…yet it failed.

Why?

Communication Crunch

There was too little communication in the production team

The decision-making process was too decentralized Internal disagreements and chaos Technology team and content team clashed New technology changes were implemented without

informing the content team

Media blitz preceded the actual launch Several delays in the launch Release was late, product was ‘buggy’

Business Model, Anyone?

“Too much, too soon” Broadband wasn’t widely available yet Bandwidth was expensive

Customers enjoyed the site, but the cost of hosting the streaming media increased as more people “tuned in”

The project did not make money Streaming media is bandwidth-intensive Who is paying for the media servers?

Advertising revenue was not large enough to support the costs

Lessons Learned

Solid business model is necessary “Cutting edge” = “Bleeding edge”

Being first may not translate to success Key stakeholders in the content development

teams must meet and agree to “milestones” Each “milestone” is a mutually-agreed

“deliverable” in the product development cycle Deviation from the agreed-upon development is

discouraged