Amazon.com is an online retailer that has taken the e-commerce market by storm. They are the number one online retailer worldwide (Amazon.com, n.d.). The company, known as AMZN on the NASDAQ exchange, is broken down into three segments: Marketplace, Prime, and Amazon Web Services (AWS) (Amazon.com, n.d.). Marketplace represents the essence of Amazon from the very beginning. Marketplace is the web retail segment of the business where customers visit and purchase products (Amazon.com, n.d.). Prime is a relatively new segment which offers a multitude of services like free three day shipping, music streaming, and video streaming (Amazon.com, n.d.). AWS is another relatively new Amazon concept, which provides Information Technology (IT) solutions, …show more content…
He narrowed his list down to two products, which were books and music (Kargar, 2004). Bezos had to analyze the market conditions to decide which way he wanted to go. He discovered that there were approximately 1.5 million books in English with about 3 million books worldwide in all languages (Kargar, 2004). Furthermore, there were about 4200 publishers and two major retailers: Barnes & Noble and Borders. Although there were two major retailers, they only accounted for 12% of the book market, and between the two of them, they only offered 175,000 titles (Kargar, 2004). The book market seemed ready for a new player, but Jeffrey still had to analyze the music industry to see if that would be a more fruitful endeavor. In contrast, the music industry was not quite ready for the internet revolution. The record industry was made up of only six major labels that had complete control of distribution (Kargar, 2004). The influence that the record labels had over the entire music industry made it easy for them to freeze out a new company. While this gave the labels power at the moment, it would prove to be disastrous for them eventually with the advent of Napster (Kargar, 2004). Because of Bezos’ analysis, he decided to move into the online book store industry. Jeffrey Bezos moved out of New York City, and moved to Seattle, Washington because it was close to Ingram book
The most obvious technological advance that helped Amazon, and the one that launched the company, was the internet (Parnell, 2014). Jeff Bezos knew that he wanted to open an online business and decided to start with a bookstore due to low pricing and an existing worldwide demand (”Amazon.com, Inc. History”, n.d.). After deciding on a model, he chose Seattle as a home for his business due to its proximity to high tech workers and a large book distributor. The website opened with a database of more than one million titles, whereas many competitors only stocked 2,000, and the orders went directly to wholesalers. Amazon quickly expanded their database to 1.5 million books and started offering deep discounts which attracted many new customers.
It's important to realize that first and foremost Amazon.com is a technology company. Over the past years, Amazon.com grew from an online retailer into a platform on which more than 1 million active retail partners worldwide do business. Behind Amazon.com's successful evolution from retailer to technology platform is its SOA (service-oriented architecture), which broke new technological ground and proved that SOAs can deliver on their promises.
Almost twenty years ago, an individual named Jeff Bezos had a vision. He saw financial potential with the growth of the internet. He wanted to change the ways of retail commerce in a way that had never been done before. Amazon began as a vision and was born in Jef...
Jeff Bezo’s began Amazon in his garage in July 1995 with three Sun workstations setting on wooden doors for tables and extension cords running from everywhere (Academy of Achievement, 2010). Right from the beginning he was a visionary leaving his well paying job as a senior vice president with D. E. Shaw to begin Amazon.com (Academy of Achievement, 2010). Being the visionary that he is he saw an opportunity prompted by the huge growth rate of internet use in a single year and ran with it never looking back. Jeff realized that the internet had “no real commerce to speak of” so he began researching possible businesses (Academy of Achievement, 2010). “After reviewing 20 mail order businesses and deciding which could be conducted more efficiently over the internet than by traditional means he decided on books” (Academy of Achievement, 2010). He thought books were perfect because attempting to send huge catalogs for all the available books would be expensive and cumbersome, but an online resource database that was easy to navigate would provide customers with easy access and a single point from which to shop. “In 30 days, with no press, Amazon had sold books in all 50 states and 45 foreign countries, obviously by the success of Amazon he was right (Academy of Achievement, 2010). In a case study written by Javad Kargar called “Amazon.com in 2003” he stated that “Amazon's online store was a big hit, with about $5 million in the first year of operations” (2004). This huge success so quickly would have confirmed for Jeff that his idea was viable and drove him to continue to strive for more. Jeff Bezo’s charismatic-visionary leadership is the key to his and Amazon’s success.
Amazon’s macro-environment is made up of six external factors: political, economic, environmental, technological, social, and legal conditions. These factors are important because they shape how the company operates and you must know each piece to be able to compete within the retail and eCommerce industry. An evolving political factor are the efforts the government has made toward punishing offenders of cyber-crime. This kind of thief wasn’t walking into your store, but hacking into your computer. This type of crime wasn’t possible before the internet. The government has started to take these crimes more serious as technology evolves. Technology is a factor that Amazon.com must invest heavily in. They are reliant on having top of the line technology to survive against cyber-crime and to stay relevant in the tech world. ECommerce is everywhere now and competition is very high. This brings in legal conditions; Amazon must know what laws exist in which countries because they are a
From the consumer side, Amazon provides services like Amazon Prime, which delivers free two-day shipping on retail purchases, on-demand video streaming and a free access to the Kindle library, everything for an annual
With very humble roots, Amazon.com grew itself from a tiny garage start up in 1994 into a multibillion dollar corporation in just twenty one years. Jeff Bezos, the founder of Amazon transformed a modest book selling website into the largest online retailer of all products which survived a giant collapse in the economy and the dot com bubble, helping Amazon start its own agenda. Amazon was vastly different than many other dot com startups due to its realistic, long term, and growth focused agenda, which greatly differed from the unrealistic, quick online startups whom mostly disappeared during the decade. Amazon has been one of the frontrunners in the new digital world, by displaying a progressive business model that builds for growth, and creating a positive future for
Amazon has been able to maintain sustainable competitive advantage based on three operational strategies. These are low cost-leadership, customer differentiation and focus strategies. Low cost-leadership is pursued by Amazon by differentiating itself primarily on the basis of price. By offering low prices to customers Amazon ensures its future success. Partially modifying the costs of lowering prices over time through achieving higher sales volumes, negotiating better terms with suppliers, and achieving better operating efficiencies. Amazon makes sure that it offers the same quality products as other companies at a considerably cheaper price. Another strategy that Amazon has is its fast delivery service and there are many delivery services that one can choose from. With Amazon Prime, there are certain, but many products that have free two-day shipping. Also, with Amazon Prime, there are many offers specifically for people that have Amazon Prime. For example,
When Amazon.com first began in 1995, as strictly a book retailer, Bezos knew he had discovered an excellent company. After all, a physical bookstore cannot stock anywhere close to the number of books Amazon can offer online. Within a year, the company had a customer base of approximately 340,000 consumers and daily site visits were huge as well. But Bezos wanted to expand the company to offer music and DVDs, because he realized there was little or no barrier of entry. In the next years Amazon would emerge as a marketplace, expanding the company globally offering products from toys to kitchenware. Because of the relatively cheap prices Amazon was offering and also the growing number of online shoppers, the company was doing tremendous amounts of sales and creating profits.
Amazon.com creates value for its customers by offering customers broad array of products to select from through their website and ensuring timely delivery of products to exhibit high level of commitment towards their business and customers
Amazon’s also tried to spearhead the industry by introducing the customer-pleasing traits in terms of the technology, order fulfillment and retailing strategies categori...
Amazon has grown to become the largest internet-based retailer in the world by total sales. It began as primarily an online bookstore and soon began to sell more and more electronics and then over time began to sell pretty much anything. In 1998, Amazon earned about 0.6 billion dollars, it held a steady growth from 1998-2006 (“Amazon.com”). From
Amazon has recorded a magnificent success in its business throughout the years that it has been in operation. It has attracted almost all people to use it when necessary. Amazon has built its success in business methodically and slowly. Amazon has made much success because of its ability to read market trends and diversify its operations. It started as an online book selling company. However, it changed its operations and started selling other products. Currently, many large retail shops use Amazon to host and power their websites, for instance, sears and virgin megastores. Amazon now attracts over fifty million visitors in a period of one month. Amazon has tried to make their services fit each individual user. It has based its services on the end user. It has shipping discounts, customer product reviews and a credit card with bonuses. It also has prime membership, product forums and 1-click ordering system among other services. The company has tried to make a remarkable experience for customers and visitors (Thomas, 2006).
Amazon is the world’s largest retailer online. Founded in 1994 it has started as an online bookstore but soon expends its catalog with software, video games, electronics, furniture, food, toys etc.
Jeffrey Bezos, the founder and current CEO of Amazon.com, initially started the company as an online bookstore in 1994. Within several months, Amazon spread its operation to all 50 states and abroad. Presently, customers from over 45 countries buy at Amazon. Over a short period of time, the company expanded sales to electronics, video games, software, CDs, DVDs, MP3 downloads, food, furniture, apparel, jewelry, and toys. Today, the company even produces its own products such as the Kindle series. Also, Amazon.com is one of the major providers of cloud computing services. Currently, the company is the largest global online retailer responsible for 20% of online retail market share.