NEED SPEAKER NOTES
We introduced this assignment in Week 1. Part 2 of 3 parts is due this week. This project should be an integrated description and analysis of the business model of a Fortune 500 company of the group’s choosing. Groups will complete a strategic analysis of the organization, and a brief description of the recommendations developed by your team for helping the organization achieve continued success.
· Part 2 – Present a strategic analysis of the organization. Conduct a SWOT analysis of the organization. Identify the organization’s strengths and weaknesses, its unique capabilities, the significant threats it faces and opportunities it has. Make sure you look at and analyze the organization from both an internal and external (industry analysis and macro-environmental) perspective. You should include attention to both business and functional-level issues and factors.
AMAZON
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Institution
Date
Business model
In its main business strategy, Amazon operates a platform business model with numerous business units within it. Some business segments, such as Prime and the Advertising business, are extremely dependent on the e-commerce platform for their success. For example, Prime enables Amazon to reward recurring consumers, so increasing the value of its platform company. Other units, such as Amazon Web Services (AWS), contributed to the improvement of Amazon’s technological infrastructure.
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Business model
Platform business model
The model has several business units that that allow the company to make money by selling its products, or collection of revenues for third party sellers who use its platform (Tarabasz, 2022)
Mission
Amazon’s goal statement is, “We endeavor to provide our customers the lowest possible prices, the finest available choices, and the greatest amount of convenience.” The statement clearly states what customers may expect from Amazon in terms of services that go above and beyond their basic requirements. It aims to provide the best possible deals to customers on three shopping factors: cost, variety, and personal satisfaction.
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“We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience.”
Products and services
Major products and services of Amazon include;
Amazon cloud (AWS)
Whole foods market
Alexa
Advertising
Amazon prime
Retail ecommerce platform
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Amazon cloud (AWS)
Whole foods market
Alexa
Advertising
Amazon prime (Tarabasz, 2022)
Retail ecommerce platform
Customers
In terms of customer expectations for tailored experiences, Amazon has set a very high standard for the competition. This is one of the things that Amazon does well that customers notice and appreciate. Consumers have stated that they are more willing to engage with an offering if it has been tailored to reflect past contacts the customer has had with the business (79 percent). Amazon does an excellent job of demonstrating to their Prime members how much they are valued. Apart from offering free shipping and same-day delivery on select purchases, they also provide free access to streaming video and music material, among other incentives, to their customers.In terms of delivery, it is nearly difficult for any small e-Commerce firm to compete with Amazon’s level of customer care.
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Customers
The company has an estimated 310 million customers all over the world
The company attracts and retains customers by;
Advertising
Using data to upsell
Providing improved customer experience
Providing perks for loyal customers (Yoo-Nah Hahn et al., 2018)
Current strategy
Generally speaking, concentric diversification may be used to define Amazon’s general corporate strategy. Based on trying to leverage technological prowess for business success, Amazon has adopted a cost leadership strategy that aims to provide the most value to customers at the lowest possible price. Additionally, Amazon has built its business around its customers, who have come to rely on Amazon as the go-to portal for all of their online shopping needs. Certainly, this approach has been successful, as evidenced by the fact that it is the world’s largest online retailer and has constantly ranked first or second in the various areas in which it is involved.
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Current strategy
Concentric diversification
The strategy focuses in leveraging technological capabilities in pursing success (Tarabasz, 2022)
The company also leverages cost leadership strategy
Revenue flow and capitalization
Amazon earns money through a variety of avenues, including retail, subscriptions, and web services, among others.Retail continues to be Amazon’s principal source of revenue, with the majority of its sales coming from both online and physical locations.Amazon Web Services (AWS) is the company’s greatest source of operational earnings, and it is growing at a rapid rate.
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Amazon controls revenue flow and capitalization through;
Retail
Subscriptions
Web service
How it maintains position and advantage
Amazon has been able to retain persistent competitive edge based on three operating strategies. These are low cost-leadership, continous innoavtion which ensures the company is introducing new value for its customers and customer differentiation. Low cost-leadership is targeted by Amazon by distinguishing itself largely on the basis of price. By delivering low costs to clients Amazon secures its future success. Partially reducing the costs of decreasing prices over time via reaching bigger sales volumes, getting better terms with suppliers, and achieving improved operating efficiency. Amazon makes sure that it gives the same quality items as other firms at a substantially reduced price
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Continuous invention and innovation
Low cost leadership
Customer differentiation (Yoo-Nah Hahn et al., 2018)
References
References
Onyusheva, I., & Seenalasataporn, T. (2018). Strategic Analysis Of Global E-commerce and Diversification Technology: The Case Of Amazon.Com Inc. The EUrASEANs: Journal on Global Socio-Economic Dynamics, 1(8), 48–63. https://doi.org/10.35678/2539-5645.1(8).2018.48-63
Tarabasz, A. (2022). Be Like Amazon: Achieving a Competitive Advantage Based on Digital Footprint Analysis. Cases on Digital Strategies and Management Issues in Modern Organizations. https://www.igi-global.com/chapter/be-like-amazon/291724
Yoo-Nah Hahn, Myoung-Kil Youn, & Dong-Ho Kim. (2018). A Brief Analysis of Amazon and Distribution Strategy. Journal of Distribution Science, 16(4), 17–20. https://doi.org/10.15722/jds.16.4.201804.17
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