Amazon reaches out beyond its border

Businesses are learning to use technology to collaborate not only within their organisations but outside them too. Amazon.com is one example. Elizabeth Biddlecombe explains how they've done it.

From the outset Amazon.com has epitomised the ecommerce era. This is not just because of its use of the web as its window to the customer but also because of the systems it has used to connect with retail partners.

The company has exposed its technology platform and product data to third-party developers who have found all manner of ways to link words in text documents and weblogs - and even data from MP3 files - to goods for sale on Amazon.com.

Craig Berman, director of platform and technology communications at the Seattle-based company, says this diverse group includes developers creating applications that enhance associate sites. Others have commercial applications "that help marketplace sellers manage business on Amazon.com", he says.

They are lured by the commission they make on each sale while at a very basic level, Amazon reaps the reward of increased traffic through its virtual checkout.

"The great thing about enabling third parties to sell on the site is that it does provide low prices and great selection to customers," Berman explains. "The flip side is that it allows developers to build their own profitable businesses."

This open approach has spawned its own industry with people writing books on how to make money through the Amazon e-machine. Two years after its launch in July 2002, some 65,000 developers have signed up to the web services platform.

One such developer is UK-based consultancy Inside C, which has developed an alternative method for customers to shop at Amazon. Its Inside Messenger application is based on the MSN Messenger instant messaging client and allows shoppers to query Amazon's database for particular products. Users keep a dedicated address in their contact list which they click to search for an item on Amazon, though they never leave the IM client to do so.

Such applications are based on the company's E-Commerce Services (ECS) platform - itself using XML and Linux - which allows access to detailed product and pricing information.

Last October Amazon released version 4.0 of the platform, which incorporated new features such as the ability to link to images of products, the retrieval of all the customer reviews for a particular product or if they prefer particular reviews written by a specific reviewer. More sophisticated searches can be incorporated and developers can add the shopping cart functionality to their website.

At the end of January 2005 Amazon announced that ECS 4.0 was also available on its French and Canadian sites, rounding out the capabilities to all six of its localised websites.

This is one part of Amazon Web Services (AWS) with another component being the web-crawling Alexa Web Information Service.

Suppliers themselves benefit from being able to plug into these systems. They can download the latest product information, manage their inventory, submit refunds and work out pricing for their goods.

Oregon-based consultancy Monsoon LLC is set up to help retailers, particularly smaller outfits with limited technological resources, plug into Amazon Web Services.

One sector that has benefited from this interfacing of systems is second-hand thrift shops that can now sell their books via Amazon. For instance, one US thrift store chain called Savers has been able to log into the system, price books competitively and then sell them. The company found itself making $8,000 in book sales per week while before using AWS it would have been recycling them.

But obviously another key reason for Amazon's ecommerce prowess is its customer-facing technologies.

Berman says the company focuses on providing three things to seed the customer experience: low prices, a vast selection of products and a convenient, enjoyable experience online.

Part of that experience is driven by Amazon's use of personalisation - the way it recognises repeat customers, logs their past purchases and tries to prompt further spending.

Berman notes a collection of ways that Amazon tries to achieve the latter - in customer reviews, product ratings, the uploading of images and wish lists. Its recent investment in a weblog called 43 Things might signify that it is planning to tap into blogs as the latest way to create a community and motivate sales.

However, Berman will not provide comment on the rationale behind the investment. Nor he says, does Amazon comment on speculation as to how the company might incorporate blogging, social networking or any other technology into its strategy.

Yet if history is any indication, Amazon will no doubt continue to find ways to use technology to reach out to partners, suppliers and customers.