When Jeff Bezos -- the man who founded Amazon as an online bookseller but guided its evolution into the Walmart of the Internet -- got into a diaper bidding war with that very retailer, he wasn't about to lose.
In an excerpt from his book "The Everything Store: Jeff Bezos and the Age of Amazon," Bloomberg Businessweek's Brad Stone recounts the scorched-earth maneuvers Bezos was willing to make as Amazon faced off with Walmart over Quidsi, the company behind Diapers.com, the online retailer of baby products. Stone also shows how Bezos' single-character e-mails sent workers into a frenzy of crisis control and other ways his brash demeanor has played a counterpoint to Amazon's data-driven development.
In the pursuit of Quidsi, Amazon at first took to manipulating discounts on its own site, using pricing bots to track Diapers.com and drop Amazon prices as much as 30 percent on competing items.
When Walmart disappointed Quidsi's leaders with a takeover offer that fell short of the standard Amazon set in its purchase of shoe store Zappos, the executives reached out to Amazon. While they met at Amazon's headquarters, the company unveiled a new service: Amazon Mom, designed to reward people who signed up for regular monthly deliveries with a yearlong Prime subscription and a 30 percent discount on diapers.
After the Quidsi executives emerged from Amazon HQ to learn of the news, they later calculated Amazon would lose $100 million over three months just on diapers with the program.
And as counterbidding between Walmart and Bezos intensified, one of Bezos' deputies warned Quidsi that his CEO would drive diaper prices to zero if Walmart won.
Two months after the meeting at Amazon's base, Quidsi agreed to be bought by Bezos' company.
Bezos won, neutralizing an incipient competitor and filling another set of shelves in his Everything Store. Quidsi soon expanded into pet supplies with Wag.com and toys with Yoyo.com. Wal-Mart missed the chance to acquire a talented team of entrepreneurs who'd gone toe to toe with Amazon in a new product category. And insiders were once again left marveling at how Bezos had engineered another acquisition by driving his target off a cliff.The book excerpt also describes "escalations," the customer complaint e-mails Bezos forwards to staff with a single character in the body, a question mark.
When Amazon employees get a Bezos question mark e-mail, they react as though they've discovered a ticking bomb. They've typically got a few hours to solve whatever issue the CEO has flagged and prepare a thorough explanation for how it occurred, a response that will be reviewed by a succession of managers before the answer is presented to Bezos himself.The passages describe the contradiction of an executive who some employees told Stone "treats workers as expendable resources without taking into account their contributions" while at the same time going to great lengths "ensuring that the customer's voice is constantly heard inside the company."
And the roll call of Bezos' acerbic bon mots fired at hapless workers could make anyone who has been an underling cringe in empathy.
Among the best/worst:
"Why are you wasting my life?"
"I'm sorry, did I take my stupid pills today?"
"This document was clearly written by the B team. Can someone get me the A team document? I don't want to waste my time with the B team document."
"Do I need to go down and get the certificate that says I'm CEO of the company to get you to stop challenging me on this?"