Sunday, January 06, 2008

Put Buyers First? What a Concept - New York Times

A rare example of the kind of press that makes corporate communications groups very happy; Amazon couldn't buy this kind of marketing -- read the full article for more details/context.

When I spoke to analysts and investors, they had all kinds of reasons for Amazon’s performance last year. “They finally reached a point where their R&D spending was not expanding as fast as their revenues,” said Citigroup’s Mark S. Mahaney. He and others also talked about Amazon’s success in international markets, its fast-growing (and high margin) merchant market, which allows merchants to sell goods alongside Amazon, and its rapidly expanding Web services business. Mostly, though, the investing community pointed to those healthier margins as the main reason for the stock’s run-up. Legg Mason’s legendary fund manager, Bill Miller, who has made a small fortune for his investors by betting big on Amazon, told me that “Wall Street is almost fanatically focused on margin expansion and contraction.”

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.

Put Buyers First? What a Concept - New York Times

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