RealTime IT News

Bezos Coy About New Categories

NEW YORK - Amazon.com's chief executive and founder said the online seller will be introducing new product categories on the site, but stayed mum on specifics regarding what and when they would be unveiled.

"We want our customers to be the first to know," Jeff Bezos said Wednesday during investment bank Bear Stearns' 13th annual technology conference.

During a Q&A-format discussion as the day's keynote speaker, the founder of the Seattle-based online retailer of books, music, DVD/video, toys, electronics, software and home products was his usual coy self about the company.

When questioned about a spate of senior executives that have recently departed the company, including chief financial officer Warren Jenson (who plans to leave later this year), Bezos said "when you're hiring great people, sometimes you're not going to keep them all that long." He expressed confidence that Amazon.com's next CFO would be a great one "like the first two."

However, Bezos was anything but shy about the company's three-pronged mantra of building on the customer's experience, explaining to the investment audience how the company was achieving improved product selection, lower prices and availability.

Cutting another 2 percent out of the company's overall fixed and variable costs would allow it to pass that difference along to customers in even lower prices, he said.

The cost-cutting efforts also led Bezos to say he would be open to dropping the free shipping threshold below the current $99-and-up cutoff.

Plus, "launching a new category now is not as capital intensive" for Amazon.com as it is for offline retailers. "We don't have to build new customer services facilities," and the site's architecture allows it to expand to new categories, for example. "What we do instead is start with customers and work backward" after asking what they want.

And what they want and respond to is lower prices, he said, which is what most of his comments eventually returned to during his appearance at the Grand Hyatt.

"I'm encouraged by all this, as we lower our prices, we accelerate our customer base. Customers like lower prices and we're happy to oblige."

He acknowledged that the used book sales portion of the company's book sales were growing very rapidly.

Bezos said despite the economic difficulties during the past two years, in which every dot-com company had to make abrupt turns in strategy, innovation is not over for e-commerce.

"I believe we'll see more innovation in the next seven years than we have in the past seven years," Bezos said.

During the first quarter, Amazon.com recorded revenues of $847.4 million, up 21 percent from the same time a year ago. Its net loss narrowed by 89 percent to $24 million for the quarter and analysts have remained upbeat about the company's ability to reach cash flow profitability by this year.