Timing Is Everything
Amazon vs. Sears: The Importance of Recognizing Opportunity
Sears was founded as a mail-order business in 1892 and became the world’s largest catalog business, selling goods remotely to consumers via mail. They established their own supply chain and a network of distribution centers that allowed them to efficiently deliver goods to consumers. They sold almost everything imaginable, and their catalog became known as “the consumer’s bible.”
Sears reached their peak performance in the early ‘70s before facing challenges from brick-and-mortar up-and-comers that included Walmart and The Home Depot. By the late ‘80s and early ‘90s, the catalog business, and the Sears company in general, began to suffer from fierce competition. As a result, Sears became tired of their catalog business and focused their efforts on their traditional brick-and-mortar retail format. Sears announced the end of their catalog division in 1993.
Jeff Bezos founded Amazon in 1994 and the company has become the world’s largest electronic commerce marketplace, selling goods remotely to consumers via the internet. They have their own supply chain and a network of distribution centers that allows them to efficiently deliver goods to consumers. They sell almost everything imaginable, from A to Z.
Sears saw the opportunity to offer a new, remote shopping experience during the late 1800s, but despite having perfected the model and the supply chain, they failed to recognize the same opportunity to replicate their success in digital form via the internet. They weren’t blocked from reviving their catalog business in the digital age. They just didn’t embrace the opportunity. Amazon would take their place as the go-to catalog shopping experience for consumers.
How good are you at understanding the importance of opportunity — at predicting market trends and leveraging new technologies — to maintain or establish market dominance?
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