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Amazon - Final Report

Amazon aims to be the most customer centric company through low prices, diversity, and innovation. Its consolidated sales have increased for 6 years mainly in electronics and services. The North American division accounted for 60% of sales in 2013. Amazon focuses on maintaining its competitive advantage through increased technology investments. It has strengths in IT capabilities and brand image that provide opportunities for expansion. Working on economies of scale could counter low profit margins. Expanding focus could counter competitors also pursuing low cost strategies. Partnering could improve the physical store experience and competitiveness. Changing industry landscapes from political, economic, social, technological, environmental and legal factors impact Amazon. It fits by upgrading technology, unique software, complex supply chains, customer focus, and innovation.

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0% found this document useful (0 votes)
62 views11 pages

Amazon - Final Report

Amazon aims to be the most customer centric company through low prices, diversity, and innovation. Its consolidated sales have increased for 6 years mainly in electronics and services. The North American division accounted for 60% of sales in 2013. Amazon focuses on maintaining its competitive advantage through increased technology investments. It has strengths in IT capabilities and brand image that provide opportunities for expansion. Working on economies of scale could counter low profit margins. Expanding focus could counter competitors also pursuing low cost strategies. Partnering could improve the physical store experience and competitiveness. Changing industry landscapes from political, economic, social, technological, environmental and legal factors impact Amazon. It fits by upgrading technology, unique software, complex supply chains, customer focus, and innovation.

Uploaded by

happyrockzz
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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EXECUTIVE SUMMARY

VALUE PROPOSITION BEING THE MOST CUSTOMER CENTRIC


COMPANY LOW PRICES, DIVERSITY AND INNOVATION
Serving Consumers,
sellers, enterprises
and content
developers. Aims to
be the Earths most
customer centric
company

Understand the
industry dynamics

Amazons
consolidated sales
have been
increasing for the
past six years, mainly
because of
Electronics and
Services segment.

Over 5 years, North


American Division
has been gaining
more importance
and in 2013, was
responsible for 60% of
consolidated sales.

Assess the growth

The focus in now on


maintaining
competitive
advantage by
increasing
investments on
technology

Verify the viability


and recommend
steps ahead

WHAT IS THE STATE OF INDUSTRY AND WHERE


ARE OUR GROWTH OPPORTUNITIES?
STRENGHTS/OPPORTUNITIES

Leverage on the strong


IT capabilities and
higher investment
capabilities
Build on the existing
brand image for further
expansion of scope

WEAKNESS/OPPORT.
Work towards
achieving greater
economy of scale to
counter the
consequences of low
profit margins.

STRENGHT/THREATS
Expanding focus to
counter the risk of
competitors also
following on the cost
leadership strategy
Take steps in improving
brand awareness about
the Amazon Web
services and its
applications
WEAKNESS/THREATS
Evaluate more on
partnering to provide
similar experiences of a
physical store and be at
par with the competitors

WHAT IS THE IMPACT OF CHANGING INDUSTRY LANDSCAPE?

Political
- International policies &
regulations
- Trade protection
- Faster and more
affordable internet
Legal
- International laws
(country & products)
- Tax issues
- Property rights
- Liabilities & management

Economic
- Currency fluctuation
- Purchasing power due
to crisis
- Increasing sales in
emerging market

PESTEL Analysis

Environment
- Pressure to reduce
unnecessary packages
- Optimized delivery
system

Social
- Restriction based on
religious&ethic
- Purchasing
preferences
- Social network
booming
Technological
- Increasing internet access
- Virtualizations
- Diversity of devices
- Development of cloud
computing

HOW DO WE FIT THE SCENE?


V
R

I
N

Use and upgrading of technologies


Brand , low prices, choice, innovation etc. The unique
patented software
Complexity internal linkages: complex and effective supply chain
Culture, history and recruitment process: customer focus, path dependency
Casual ambiguity Heavy investment in Research & Development, Customer
experience
Change to innovate and keep ahead of competitors: use of dynamic
capabilities

Amazons customer centric and fast moving culture

Increasing
bases of
sustainable
competitive
advantage

Are the competitors changing their strategy? Competitive map


High Price
Shopify

High
Technology

Low Technology

Amazon.com

WalMart
eBay

Revenue : 68 M$
Growth : 31%
Gross margin : 1,8
M$

Low Price

Are the competitors changing their strategy? Competitive map


High Level of
Execution

Amazon Web
Services

Microsoft

Low Innovation

Revenue : 3.8 M$

Virustream

IBM

High
Innovation

Fujitsu
Google

HP

Growth : 40%
Gross margin : 80%
New competitive
positioning, with highmargin activities

Low Level of
Execution

HOW DO WE PUSH THE GROWTH?


Globally over the past five years, online retail has grown at a 17
percent CAGR, with growth particularly strong in Latin America (27
percent) and Asia Pacific (25 percent).
The worldwide cloud computing market will grow at a 36% compound
annual growth rate (CAGR) through 2016, reaching a market size of
$19.5B by 2016.
Amazons computing services has been the business unit with the
biggest YoY growth, 55,9% in 2013, whereas the International division
has increased 22% and North American Division increased 58%.

HOW DO WE PUSH THE GROWTH?

What do we recommend?

Improve
Avoid practices which
can jeopardize its brand

Improve its performance:


environment, diversity

Questions?

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