Jeff Bezos on the Power of Word of Mouth

BusinessWeek: How important is advertising to building the brand?

Jeff Bezos: We don`t do any television advertising, and we take all of the money that we would put into television advertising, and instead put it into things like free SuperSaver shipping [free shipping on most orders over $25], lower product prices, category expansion, and invention of new features. We take those funds that might otherwise be used to shout about our service, and put those funds instead into improving the service. That`s the philosophy we`ve taken from the beginning. If you do build a great experience, customers tell each other about that. Word of mouth is very powerful. ...

BW: It`s fascinating that the increase in the value of your brand has happened at the same time when you`re not advertising in mass media at all. Do you anticipate ever needing to use broad-scale advertising again?

Bezos: No. Never say never, but I don`t anticipate that. I like the strategy we`re on.

(via heif)