A Case Study on amazon.com Business strategy coursework
This business strategy of Amazon is based on increasing their market share by increasing product line, as mission statement of Amazon implies that it aims to be online Walmart.It had 900000 websites in 2002.The Amazon invests a great deal in continuous innovation and information systems.( Amazon 2002)
The business strategy of Amazon is to stay away from competitors by increasing their product portfolio and enhancing the customer service levels .The Amazon was the largest online book store in 2000 and it started selling jewelry, CDs, cell phones, home appliances, clothes etc to increase its market share .The customer service features like information, payment system and highly delivery services were aimed to retain the customer. The business strategy of Amazon was to integrate all the businesses online and secure the payment system to build brand equity of Amazon. The business strategy was to create an online marketplace for itself and third parties, like we can purchase Nike products through Amazon.com.The Amazon business strategy is to maintain long term relation with suppliers so that to improve price and build brand equity by selling branded products .By building trust among suppliers Amazon also nullifies the threat of new entrants evident in the case study.
Response to the competitors
Google, E-bay are the closest competitors of Amazon .Though Amazon had first mover advantage but dotcom boom and innovative approach of competitors lead to loss of market share for Amazon. The Amazon has responded by differentiating its product and services .like street level view of digital mapping services and online grocery is open by Amazon to differentiate from its competitors. The key service offering include browsing, searching reviewing content, recommendations and personalization .one click technology and secure credit card payment. As a response of its competitors and the external environment Amazon is changing its business model to find new markets and trying to provide the diverse range of product and services to the customers.
Amazon focuses on different segments of customer and sells wide variety of products online. (Case study 2007).
The future strategy of Amazon
The Amazon .com business based on selling products online .Amazon is market leader and but it has lost market share due to competition. Amazon has earned a lot of success in the b2c market and still is a market leader .since the last ten years it has been experimenting in the b2c market .But the competition from Google and other competitors has made it to loose its share. So instead of further expanding its businesses its should enter and try to step into b2b businesses by using mergers and acquisitions. This will be the best option to stay away from competitors and using its infrastructure. The strategy for the future for Amazon will be consolidation of existing businesses and concentrating on b2b business.
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