Amazon faces little threat from Bezos drama, experts say
A splashy tabloid scandal that has engufled founder Jeff Bezos is ingiting questions over whether Amazon will take collateral damage, but in a testament to the dominance of the e-commerce giant and its role in revolutionizing an industry experts say the company should emerge unscathed from the latest drama.
This isn’t “going to have any impact at all on Amazon, on its customers, on its customer base, on its suppliers or on its stock price,” Steven Fink, CEO at Lexicon Communications Corp., told Fox Business. “It’s a non-issue for that side of the business.”
Amazon and Bezos are no strangers to controversy, but a slew of damaging headlines and pressure from top elected officials has done little to dent the company’s success. In 2018, Sen. Bernie Sanders -- an independent from Vermont who caucuses with Democrats -- blasted the large number of Amazon employees on food stamps. Meanwhile, it faced new criticism over its treatment of its drivers, including the need for some to urinate in bottles to accelerate delivery times.
Despite the onslaught of negative publicity, the stock soared last year to become -- albeit briefly -- the second U.S. firm to be valued at over $1 trillion. Even President Trump’s direct attacks on Bezos – who also own the Washington Post – and Amazon have had little effect on investor confidence in the Seattle-based online retailer.
Now, after Bezos publicized an alleged black mail attempt by the parent-company of the National Enquirer, attention has again shifted to the potential impact on Amazon and whether the increasingly public life of its 55-year old billionaire founder will elicit any pushback from shareholders.
The general consensus, at least among crisis communications professionals, is no.
"The Bezos-Amazon board relationship is a very different one from some of the other companies where they’ve had CEO behaivor problems in the past," said Chris Allieri, a principal at public relations firm Mulberry & Astor. "The stock is performing very well and the company is doing extremely well."
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AMZN | AMAZON.COM INC. | 198.38 | -4.50 | -2.22% |
| TSLA | TESLA INC. | 339.64 | -2.39 | -0.70% |
While experts argue no two cases are the same, Bezos has largely escaped the scrutiny faced by other CEOs whose personal lives overshadowed work at their companies.
Tesla-founder Elon Musk faced intense criticism after he appeared on U.S. comedian Joe Rogan’s podcast and smoked marijuana, largely due to the fact that his other company – SpaceX – has several major contracts with the federal government.
Musk also continues to deal with the fall-out over a tweet last year claiming he would take the electric carmaker private at $420 per share – a common reference to smoking in marijuana culture. The Securities and Exchange Commission later found there was no factual basis for that pledge and charged both Tesla and Musk a $20 million fine.
And in 2017, Uber CEO Travis Kalanick resigned as head of the ridesharing firm amid investor backlash over his handling of sexual harassment claims among the workforce.
For Bezos, it remains unclear how much farther his feud with American Media Inc. (AMI) will go. The company – in the emails published by Bezos earlier this month – threatened him with the release of lewd photos unless he agreed to a set of terms.
Should the National Enquirer publish those pictures, it could increase the pressure from shareholders or even rank-and-file employees to step down.
“If a bunch of photos do come out, that would make his ability to govern the company very difficult,” Allieri said. "Amongst his workforce, I don’t think that he has a strong brand. I don’t think he evokes a loyal following.”
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And as Bezos appears to further embrace more aspects of celebrity life -- spurred in part by Amazon’s expansion into film and other Hollywood endeavors -- he is also opening himself to greater criticism.
The world’s richest man, Bezos is facing new scrutiny since the publication of the AMI emails over his lack of large-scale charitable giving. A $2 billion donation last year to launch a fund dedicated to battling homelessness was the first major contribution in years.
