In order to support his vision, he investigated the top-twenty (20) mail order products paying particular attention to how he could add to, or create, a strong value proposition.
For Bezos, the "value add" in his model was to be something that the customer truly wanted such as ease of selection, low price, or some other base level "need." Without a significant value boost for the customer, there would be too much of a tendency to simply do things in the "old way" (Quittner, 2003, 4). For Bezos, the basis for the business model was simply to determine what he could do (from a business perspective) that could simply not be done any other way than through use of the Internet. Ultimately, his search led him to retailing (or "e-tailing") books.
The last great shake-up to happen to the retail business environment occurred at the end of the nineteenth century (during the 1890s) was the concept of "mail order" which was lead by Sears, Roebuck (Ramos, 1999, 2). At the time, mail order solidified the concept of fixed pricing since the seller and the buyer were separated, in most cases, by many miles of rail track. Today, this separation is measured in nanoseconds, regardless of the physical distance between seller and buyer. Thus the old economics of retail are gone, having been supplanted by the new reality of the Internet.
On-line shopping has grown nineteen (19) times faster than traditional "brick-and-mortar" retailing in December, 2002 and increased another five (5) percent in January, 2003 to represent six (6) percent of all retail sales in the United Kingdom (Roper, 2003).
During the "Internet boom" many merchants with on-line and off-line channels wound up confusing their customers. Often there was a lack of pricing consistency between the channels as well as differences in products offered. It was not uncommon to find a product in the traditional/physical store, but not in the on-line store and vice versa (Hanrahan,...