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Case Analysis Of Amazon

argumentative Essay
1290 words
1290 words
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Amazon. com: An E Commerce Retailer I. INTRODUCTION In June of 1995, Amazon.com was officially launched on the World Wide Web. The company was one of initial noteworthy companies to process transactions for products over the internet. It was launched at just an online bookstore originally but has since re-engineered its product lines to incorporate CDs, DVDs, electronics, computer software, video games and toys, and a lot of other products as well. It began in Seattle, Washington, and now is an established competitor globally. 1. In the case study, Amazon.com: An E-Commerce Retailer from Strategic Management and Business Policy, Wheelen, T. L. and Hunger, J. D. 11th ed., Jeff Bezos, Amazon’s CEO is faced with evaluating and possibly formulating new strategies in order to keep Amazon.com on the forefront of what consumers are looking for in online shopping, to remain competitive, and profitable. One alternative is to expand the business into online auctions, such as the company E-Bay. The product offerings would exponentially become much larger but the day to day operations would possibly be too costly for cost-effectiveness. The second alternative is to partner with other retailers to add variety to their product lines and utilize their IT capabilities to create partnerships that mutually benefit the companies. 2. Amazon had a business model that was posed to expand its strategy to include partnerships with established retailers who wanted to streamline their online capabilities. Under this model, Amazon acted as a logistics provider and helped such companies upgrade their online distribution systems. These 3rd party partnerships with large retailers would broaden Amazon’s service offerings and create allies with retailers ... ... middle of paper ... ...’s typically harder to be aware of how to be competitive and what growth demands are on the horizon. An alternative option available to Amazon.com is to provide customers with greater value for their money through utilizing a best cost provider strategy. Amazon has the information available to them. They could use their current status of best cost provider through offering products with superior features at a lesser cost than their competitors because they know all the products and retailers intimately. This strategy offers Amazon with the possibility of combining the low cost provider strategy with the differentiation strategy. The difference between a best cost provider strategy and the low cost provider strategy is that the best cost one is aimed at value conscious customers, whereas a low cost one is directed towards the budget conscious sector of the market.

In this essay, the author

  • Explains that amazon.com was launched on the world wide web in 1995 and has since re-engineered its product lines to incorporate cds and dvds, electronics, computer software, video games and toys.
  • Analyzes how jeff bezos, amazon's ceo, is faced with evaluating and possibly formulating new strategies in order to keep the company competitive and profitable.
  • Explains how amazon expanded its strategy to include partnerships with established retailers who wanted to streamline their online capabilities.
  • Describes jeff bezos, ceo of amazon.com, as a pioneer in the internet technology based companies. he realized that the lucrativeness for amazon was its function ability, not its own product lines.
  • Describes amazon's strengths, including fast and reliable delivery, state-of-the-art secure online payment methods, low cost, wide product range, and unparalleled expertise in internet e-commerce.
  • Explains that the potential entry candidates into the e-commerce retailing industry are quite strong and the power of the world wide web means the technical resources are available to every organization that want to.
  • Explains that amazon has a strong recognizable brand and is well known for easy to use web capability and finding features customers love and become accustomed to when online shopping.
  • Explains that rivalry within the market is tough. many competing sellers use technology to enhance performance of their market standing and business profit.
  • Explains amazon must remain profitable to stakeholders and maintain market share of the internet based retailing industry. amazon relies on a number of suppliers which increases the bargaining power of their suppliers.
  • Explains that amazon's strategy is based on low costs and uses a customer focus to benefit customers in struggling or declining markets.
  • Explains that amazon's web sites are powered by cutting-edge technology. their success and other retailers' success depend on their technological capabilities.
  • Opines that knowing how to identify customers' needs and analyze competing sellers as potential partners is the most effective long term strategy for amazon.com.
  • Compares amazon's best-cost provider strategy with a differentiation strategy. both are aimed at value-conscious customers, whereas the low cost one is directed towards the budget conscious market.
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