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Amazon and Borders: From Sector Focus to Competence Focus

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Innovating in a Service-Driven Economy

Abstract

In the 1990s, Borders, along with Barnes & Noble, pioneered the retail book megastore business to become America’s dominant booksellers, together accounting for 40 percent of books sold in the United States.1 Brothers Tom and Louis Borders opened the first Borders bookstore in Ann Arbor, Michigan, in 1971, and the company grew rapidly through a combination of a superior inventory and distribution system and aggressive acquisitions. Jeff Bezos founded Amazon.com in Seattle, Washington, in 1994, choosing the name Amazon because it was the biggest river in the world, and he wanted his business to become the world’s biggest store.2 Now at just over 20, Amazon has gotten there by becoming “a serial business model innovator”3 that not only disrupted the bookselling industry but transformed the entire world of retail as the original electronic commerce (e-commerce) pioneer. In essence, Amazon turned the traditional retail model on its head, moving from a “sector retailing” approach to a retailing-for-all-sectors approach.

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Notes

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© 2015 Richard Cuthbertson, Peder Inge Furseth and Stephen J. Ezell

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Cuthbertson, R., Furseth, P.I., Ezell, S.J. (2015). Amazon and Borders: From Sector Focus to Competence Focus. In: Innovating in a Service-Driven Economy. Palgrave Macmillan, London. https://doi.org/10.1057/9781137409034_10

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