Measure Market Leadership, Not Short-Term Profit

Because of the long-term focus, Amazon measured itself on the metrics most indicative of market leadership: customer growth, revenue growth, repeat purchase rate, and brand strength. Profitability was deliberately deferred.

The logic is a flywheel. The stronger the market leadership, the more powerful the economic model: higher revenue, higher eventual profitability, greater capital velocity, stronger returns on invested capital. Leadership first, economics later.

The 1997 numbers show what he was tracking: sales up 838%, customer accounts from 180,000 to 1.5 million, repeat orders climbing from 46% to over 58% of the total. Repeat rate is the quiet star of that list. Growth you have to rebuy every month is not leadership.