Amazon CTO Werner Vogels says it will 'go out of business in 10 to 15 years' if it stops innovating
- Amazon chief technology officer Werner Vogels said the tech giant will "go out of business within 10 to 15 years" if it fails to keep innovating.
- Vogels was speaking at the Web Summit technology conference in Lisbon, Portugal on Monday, where he discussed a number of themes related to e-commerce and fintech alongside eBay's vice president of global payments, Alyssa Cutwright.
- The 61-year-old exec also said that "the biggest wins" for Amazon won't come from engaging in direct competition with its e-commerce rivals, such as eBay.
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Amazon is hardly known for its aversion to innovation: in 2017, it reportedly spent an eye-watering $22.6 billion on research and development alone. Its founder and CEO, Jeff Bezos, is still the world's richest person despite his overall net worth declining by almost $15 billion in the past 12 months.Yet according to Amazon chief technology officer Werner Vogels the tech giant will "go out of business within 10 to 15 years" if it fails to keep innovating.
He said: "A number of years ago, we released Amazon Prime, which guaranteed a two-day delivery for free, included in a package. We're now shifting that to one day. That's a massive change. But that's really what customers are expecting.""I'm a strong believer that, at Amazon, if we stop innovating, we'll be out of business in 10 to 15 years," he said. "[If we stop] someone will be doing diapers better. Someone will be doing shoes better. It's not that eBay will put us out of business; we have a bunch of unique businesses that are separate from each other."
"Effectively, customers will have access to perfect information. They will know exactly where they can get the best deal, and who they can trust. And trust is extremely important in an e-commerce context," he said.The Dutch-born technologist added that engaging in direct competition with eBay - Amazon's predecessor as the world's biggest e-commerce platform - was not Amazon's main priority.Asked what Amazon does better than eBay as a company, Vogels replied: "We [Amazon and eBay] both demonstrated that we have many businesses that are in some ways competing with each other. That's true; that's healthy. But I do see that only 3 percent, or something like that, of total commerce purchases in the US are actually online"
According to the US Department of Commerce, it should be noted, 10.7% of sales in the second quarter of 2019 were done via e-commerce.
"We have more work to do to get more people to shop online," he continued. "I think that's where the biggest wins are, not in competing against each other. We need to make sure that customers are continuing to place their trust in the online experience, and [to make sure] that becomes the place they like to shop."