What a 19th-century French novel tells us about Jeff Bezos and Amazon

10 Dec What a 19th-century French novel tells us about Jeff Bezos and Amazon

A thirtysomething entrepreneur with a genius for systems and a passion for customer service builds an Everything Store that revolutionizes retail. This is not the story of Jeff Bezos, but of the fictional Octave Mouret, the owner of an 1860s Parisian department store in Emile Zola’s 1883 novel Au Bonheur des Dames (The Ladies’ Paradise).

The great department stores of Paris that inspired Zola’s work were the first retailers to sell more than one type of product; to dazzle their customers with sumptuous displays; and to drive business through seasonal sales, same-day delivery, mail order, and no-fault returns. In the process, they turned shopping into a new form of entertainment for middle-class women.

In 1994, Bezos was 30 and working in finance when he read that web usage was growing 2,300% per year. “I’d never seen or heard of anything that grew that fast, and the idea of building an online bookstore with millions of titles—something that simply couldn’t exist in the physical world—was very exciting to me,” he recalled in a 2010 Princeton University address.

Zola’s Mouret was also a man of his time. In the 1860s, Paris was the largest city in Europe, and it led the world in finance, commerce, fashion, and the arts. City prefect Baron Haussmann swept away entire medieval neighborhoods to create the wide boulevards for which Paris is now famous. Gas lamps illuminated the city at night. The new railroads disgorged goods from all over the world to feed the consumer appetite of a growing middle class.

When the world’s first department store, Bonmarché (which still exists today), opened in 1852, it was a revolution in retail. Parisian retailers were traditionally specialist boutiques selling only one type of product. Customers haggled over the price. Department stores introduced fixed pricing and offered multiple categories of product under one roof.

The entrepreneurs

The charming, handsome, and high-spirited Mouret is working as a draper’s assistant when he marries the widow of his recently deceased boss, a silk merchant. Building on his new wife’s small business, the thirtysomething Mouret (now a widower) builds an empire with 3,045 employees, 50 departments, and a store that dominates several city streets. For Zola, Mouret embodies the spirit of the age.

“It’s wanting something and acting on it, you see, creating something in short. You get an idea and you fight for it, you hammer it into people’s heads, you see it grow and triumph,” Mouret says to an old friend early in the novel. It’s easy to see the parallel between this fictional entrepreneur and the real Jeff Bezos. “I want to see good financial returns,” Bezos has said, “but also, to me, there’s the extra psychic return of having my creativity and technological vision bear fruit and change the world in a positive way.”

The cult of the customer

Bezos is famous for his relentless focus on the customer. “We see our customers as invited guests to a party, and we are the hosts,” he has said. “It’s our job every day to make every important aspect of the customer experience a little bit better.”

Mouret creates an entire world within his store to seduce his female customers into buying. (Early in the novel he takes a new mistress, Henriette, purely in order to be introduced to her previous lover, who owns a plot of land on which Mouret wants to expand his store.) In fact, his business is built on women, both as customers and as stepping stones in his career:

Mouret’s sole passion was the conquest of woman. He wanted to make her queen in his house and he had built this temple so that he could have her at his mercy. His whole tactic was to intoxicate her with his attentive gallantry, to trade on her needs and to exploit her feverish desires. So, day and night, he racked his brain searching for new ideas.

The novel contains five female characters with differing attitudes to shopping, including Mouret’s mistress, Henriette. These women are essentially an unusually fleshed-out set of early customer personas:

Madame Marty, carried away by her passion for spending, taking everything at Au Bonheur de Dames, without discrimination, as she chanced to encounter the displays; Madame Guibal, strolling around for hours without ever making a purchase, happy and contented at simply giving her eyes a treat; Madame de Boves, stretched for cash, constantly tortured by excessive desires and bearing a grudge against goods that she could not take away with her; Madame Bordelais, with a sensible and practical bourgeois flair which took her straight to a bargain, using department stores with the skills of such a good housewife, quite dispassionate, that she made considerable savings out of them; and, finally, Henriette, who, with her high dress sense, only bought certain items there: gloves, hosiery, household linen.

Mouret devises new techniques to lure each woman into buying. The sensible Madame Bordelais, who never buys luxuries for herself, finally succumbs when Mouret opens a children’s department, stopping her and her three children as they walk by to offer them pictures and balloons. Madame Marty, who is ruining her husband with her spending sprees, is spurred on to even greater follies when Mouret introduces the ability to return items:

Then he went deeper into a woman’s heart and had recently dreamed up “returns,” a masterpiece of jesuitical seduction . . . And the woman who had been holding out, was given this ultimate excuse, the opportunity to repent of her folly. She took the item with a clear conscience.

Low, low prices

According to a 2004 Fast Company profile by Alan Deutschman, Bezos never hesitated to introduce innovations that hurt Amazon’s sales and profits, at least in the short run, as long as they were good for the customer. “There are two kinds of companies, those that work to try to charge more, and those that work to charge less,” Bezos has said. “We will be the second.”

Mouret’s mantra is also to sell cheaply in order to sell a lot. He contents himself with a small profit margin but sells in volumes unimaginable during this period. The innovation of fixed pricing meant that customers could easily compare prices to get the best deal and leads to the introduction of the heavily advertised sales that the department stores used to clear the shelves of outdated stock.

Mouret shocks his lieutenant by insisting that they sell a signature silk fabric below cost price during one of these sales:

“We shall lose a few sous on the stuff, very likely,” says Mouret. “But what can that matter, if in return we attract all the women here, and keep them at our mercy, fascinated, maddened by the sight of our goods, emptying their purses without thinking?”

Builders of systems

Mouret creates a mail order department into which orders flow from all over Europe. By the end of the novel, the mail order department employs more than 200 employees and a special post office van is required to deliver Au Bonheur’s correspondence. The store offers same-day delivery within Paris to customers who do not want to carry their purchases home. The goods are packed, sorted on tables, placed in compartments representing each district, and sent up to horse-drawn vans standing alongside the pavement.

Mouret’s selling machine depends on the constant turnover of goods in his store, while Amazon has eliminated the need for a physical store altogether. Mouret would rather sell at a loss than keep last year’s items on the shelves, and this inspires one of his many innovations:

They examined the sample of a little book with counterfoils which Mouret had just devised for debit notes. Having observed that the larger the commission given to the assistants, the faster outdated goods, the “turkeys” of the trade, disappeared from the shelves, he had thought up a new scheme by which the sales staff would gain by the sale of all goods: he gave them a certain percentage on every single last piece of material or item that they sold . . . He had a genius for administrative systems and dreamed of exploiting the appetites of others, so that he could satisfy his own, quietly and utterly.

Bezos is often lauded for his brilliance as a systems builder. In 2002, he issued the famous API memo, which led to the creation of Amazon Web Services, a $17.46 billion business in 2017.

The selling machine

Mouret may have not had access to the technology that helps define Amazon, but his department store is constantly described as a machine in the novel, a finely tuned mechanism for making money:

Here, there was the continuous purring of a machine at work, the customers shoveled in, heaped in front of the displays and dazzled by the goods, before being hurled against the cash desks. And it was all organized and regulated with mechanical precision, a whole nation of women caught up in the power and logic of the turning cogs.

Amazon is also a vast machine of software and hardware, from its website and processing systems to its vast, robot-powered warehouses. In its ruthless pursuit of efficiency, the company has frequently been criticized for treating its warehouse workers as mere cogs in that machine, in a similar manner to Mouret’s sales staff.

Mouret’s salespeople were better paid than their contemporaries and if promoted could earn a handsome income (the buyer in the ladies’ wear department, for example, earns three times her husband’s salary). But they also live in fear of summary dismissal during the slow season and are engaged in a cutthroat struggle for advancement and money.

This dog’s life made the best of them bad and the sad procession began: all of them eaten up by the job before the age of 40, disappearing into the unknown, several of them dying, consumptive or anemic, killed by exhaustion or the bad air, some dying on the streets, the luckiest married and buried in some little shop in the provinces.

Big ideas

Deutschman, the author of the 2004 Fast Company feature on Bezos, contends that what really distinguishes him are not his brilliant systems but his harrowing leaps of faith. “His best decisions can’t be backed up by studies or spreadsheets,” the author says. “He makes nervy gambles on ideas that are just too big and too audacious and too long term to try out reliably in small-scale tests before charging in.”

Bezos and his leaps of faith have taken Amazon from a modest online bookshop, for which he once personally packed and mailed packages, to a vast emporium of 3 billion products and annual revenue of $178 billion.

Mouret is also a man with big ideas that require him to take big risks, often to the dismay of his staff and investors:

When Bourdoncle dared to express some anxieties about the overexpansion of this department or that, where the turnover was shaky, he gave a fine, confident laugh and said: “Forget it, my dear man! The shop is too small!”

At this point in the book, Au Bonheur des Dames is already the largest store in Paris.

At the end of the novel, Mouret stages his great white sale, a summer sale of every white item in the store. The sale brings in a staggering 1 million francs from 40,000 customers over the course of a single day. Mouret surveys the scene at the end of the sale.

Mouret was still looking at his nation of women . . . They were starting to leave. The counters were littered with lengths of cloth and gold pieces rang in the tills, while the customers, despoiled, violated, were going away half undone, with the satisfied lust and vague shame of a desire slaked in the depths of some shady hotel. He was the one who possessed them in this way, who held them at his mercy, by his continual heaping up of goods, lowering of prices and profits, his charm and his advertising.

The attitude is that of a 19th-century Parisian. But Bezos, whose annual Prime Day aims to whip up consumer frenzy on a worldwide scale, would surely admire the bottom line.

Source: Fast Company