Professional Documents
Culture Documents
Amazon.com’s Business
Model and Its Evolution
Table Content
1 Amazon
Case Analysis
Background
3 4
Recommendation
2 Issue
Identification
Amazon Background
• America multinational technology company, found in June 1994
by Bezos. l
• The largest e-commerce maretplace in the world.
• Constantly innovated its business model from consumer
electronics to cloud computing service and finally into technology
business.
• Starting from selling books online, later diversified to sell wider
selections of products- 20 product categories
• Owned Kindle e-book reader, Fire Tv, Fire Phone, ect.
• In 2015, Amazon’s market value of $262.7 billion.
Issue
Identification
Issue Identification
Company Strategy :
Long term investment > Short Profit
5.How to effectively
execute across so many
different types of business
Case
Annalysis
Amazon’s competive strategy
Elements:
Low prices
Wide selection
Convenience
Customer service
Innovative technology.
How elements fit together?
For the low prices:
Amazon did not have to maintain physical store
and have sale tax advantage because of operating in
virtual world => deliver low price products to
customers.
Allowed sellers directly sell their products on the
websites => its cost advantage over traditional stores.
By purchasing a large volume of product directly
from manufacturers = > receive discount from them.
Consistently offering low price => built a positive
perception of best price provider in customers’ mind
How elements fit together?
Convenience:
◉ Wide selections
◉ Order products cheaply and reliably with a click of a button
◉Website: browser friendly with easy-to-use functionally,
◉ Had minimum download time
◉Assisted customers to find products and well-informed about
products.
◉Automated order management systems which closely link to its
suppliers and payment network => get the products within 24h
How elements fit together
Customers service
◉Wide selections of products,
convenience of shipping and buying, best
prices => added value to customers.
◉provided customer reviewing and rating
systems,built customer loyalty program
and personal bond with customers.
Strategy evolves overtime
Late entrance
=> Hard to get market share
and position in the customer
mind + High cost for
investment
6. Assessment of Amazon’s financial performance in
the past three years
Assesstment of Amazon’s financial
statement
Assesstment of Amazon’s financial statement
2.
Retrench to a narrower scope of
diversification by divesting or
being more selective with its
capital allocation into poorly
performing businesses: digital
media
Recommendation
You can also split your content
3.
Should invest in fulfillment
and logistic: building
fulfillment centers,
warehouse in foreign
countries that they want to
enter
5.
Follow strategic alliance or
acquisition
promote advertising,
approach to more
customer and achieve
economies of scope…
Thanks!
ANY QUESTIONS?