Amazon's Bezos: Personalization Is Key on the Net

NEW YORK (06/28/2000) - What technology has taken away from business -- the personal touch -- it can bring back in the era of the Internet, according to Amazon.com Inc. founder and Chief Executive Officer Jeff Bezos.

Personalization, the ability to tailor a Web site's interface to each user logging on, is key to Amazon.com, one of the most recognized names on the Internet, Bezos said at a keynote address here at PC Expo Wednesday.

"If we want to have 20 million customers, then we want to have 20 million 'stores' ... our mission is to be the earth's most customer-centric company," Bezos said.

Modern technology and culture have given us supermarkets and giant super bookstores where merchants do not know the people who are shopping, Bezos said.

What's the ultimate in personalization? When "you go into a bar and sit down, and the bartender puts a whiskey in front of you without having to ask what you want," Bezos said.

Amazon.com has filtering mechanisms to try to get close to this kind of personalized service, Bezos said.

Amazon.com records what a shopper purchases and then matches the acquisitions to the aggregated purchases of other shoppers who have bought similar products, Bezos said. By comparing what an individual shopper has purchased to aggregates of what shoppers with apparently similar tastes have purchased, Amazon.com has come up with, for example, a "new for you" feature. The features can suggest, for instance, that based on a certain book purchase a shopper might like a certain newly released music compact disc.

Amazon.com shoppers can also set up lists of "trusted friends" to see what people whose taste they trust are buying, Bezos noted. Individual shoppers can also set up "best-seller" lists of favorite purchases, review them and make the reviews public -- other shoppers can rate the reviews according to how helpful they found them.

The idea of a merchant getting to know customers, introducing customers to each other and making recommendations is, "in a sense, a return to yesterday; in a sense, what technology has taken way from us is the ability for small-town merchants to make recommendations," Bezos said. "But I think that what technology has taken away, maybe over time, technology can return."

In a question-and-answer period following his prepared remarks, Bezos fielded a number of questions about privacy. He pointed out that Amazon.com does not ask for demographic data such as income of shoppers, though he did not rule out that it would do so in the future. He said that Amazon would possibly use the information on a shopper's purchasing habits to place paid advertising from third-party businesses, but that the difference between a paid-for recommendation and a recommendation that is the result of Amazon filtering would always be made clear to the shopper.

Responding to questions about when Amazon.com will be profitable, Bezos refuted an investment asking company report issued last week that forecast the company will run out of cash soon. He said the music and DVD (digital versatile disk) segment of the company was about to break even and that the books' segment was profitable for several quarters recently. [See "Bezos: Amazon.com Will Not Run Out of Cash," June 28.]Amazon.com, based in Seattle, can be reached at http://www.amazon.com/.

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