Just about one month ago, that world’s leading technology giant Apple Inc becomes first ever American public traded company to hit $1 trillion in valuation, e-commerce giant Amazon Inc becomes the second American public traded company that will hit that milestone as the company stock shares rose as high as $2,050.50 on Tuesday morning, pushing it over $1 trillion in value.
But while Apple reached $1T by dominating one category (cool tech hardware), Amazon reached $1T by diversifying revenue streams. Now, Amazon is applying its recipe for disruption-fueled growth to the $88B digital advertising industry.
A tale of two trillions: The Buffett-Bezos binary
Apple, a fav of Warren Buffett, moves slowly and cooks up profits; Amazon moves fast and eats losses. Both approaches are working — but Amazon’s approach works faster.
Amazon hit $1T 21 years after its IPO, 17 years faster than Apple. The big bookseller also grew at a quicker incremental clip: they went from $600B to $700B in 16 days, compared to Apple’s 1 year and 257 days.
Different paths, different payouts
Apple’s strategy of high-value product leadership has worked. By controlling more than 50% of the smartphone market across the globe, they’ve vaulted their stock price from a $22 IPO to a high of $228.36 — a 10x increase in value.
Amazon, on the other hand, dominates e-commerce (49¢ of every $1 spent) and data storage, has made serious leaps in food delivery, entertainment, and healthcare, sending stock prices from an $18 IPO price to $2,050.50 (a 114x increase).
A $1k investment in Apple’s IPO would yield roughly $527k today. That same investment in Amazon’s IPO would net $1.2m — with 17 fewer years of waiting.
Even in the digital ad game, Amazon has room to grow
Now, Amazon is poised to jump into the tech-crowded market of digital advertising. Amazon’s big advertising rivals Google and Facebook now for 50%+ of the $88B digital advertising market.
But while advertising is the backbone of business at Facebook and Google, it’s just another department at Amazon — one that happens to be growing 130% year over year.
