Amazon Strategic Management Study

Given the number of products available, the bargaining power of customers in this industry is very high. The two main drivers for customer’s preferences are quality and price, there is no service involved.

Through selling more in a lower price, Amazon can achieve economies of scale, which in return can increase their bargaining power over its suppliers and partners.

As of January 2010, Amazon.com has three times the Internet sales revenue of the runner up, Staples. By offering a large amount of varied categories through its website and other international ones (Amazon.co.uk, Amazon.co.fr, and so on), it has managed to grow to a customer based company with over 30 million people. In addition, the online retail format enables the company to reduce costs of managing inventory (Amazon.com; online bookstore, 2008).

One of the companies that exploits opportunities and business ventures to create growth and sustainability is Amazon, Inc. Amazon was founded in 1994 and since then it has opted to take its business online and thus develop a global strategy that has paid off and turned the company into a technological business hub that serves consumers by offering an assortment of products and services in a noteworthy customer service. These strategies have made Amazon one of the leading online retailers with a revenue of US$ 88.988 billion as of 2014. This paper thus seeks to describe Amazon’s grand strategies of product development, market development, and concentration as part of its long-term growth strategy.

However, Amazon.com made this chain or supply useless. At amazon.com, unlike traditional bookstores, there are no bookshelves to browse. All contact with the costomer is either through its web site or by email. At the firm’s web site, customers can search for a specific book, topic and etc. Customers can browse, fill up a virtual shopping basket, and then complete the sale by

Amazon is the world’s largest online retailer that was launched in 1995 (Rouse, 2014). Amazon was mainly a book selling company that has enlarged its’ business by selling a variety of goods. The company sells all types of technology devices such as cell phones, games, televisions, movies, cameras, computers,

This sort of global expansion adds great complexity to the functionality of Amazon’s management, personnel, operation systems, technical performance, financial resources, and internal financial control and reporting functions. With the perplexity of current situations, Amazon may not be able to sustain growth effectively, which ultimately could bring damage to their reputation and limit their operating growth as well. .

If a buyer represents a large percentage of the supplier’s sales, the buyer has more bargaining power over the supplier. Rogers’s chocolate 50% of sales is contributed from its 11 retail stores which is a strong one. However, since the previous president Mr. Jim Ralph had grown its wholesale market up to 30% thus, they have to take a good care of its

2-B&N and the book publishers are changing their business models to deal with the Internet and e-book technology by B&N developing its own e-readable devised called Nook. In order to meet demand and supply, they started to be actively in control of its supply chain by developing,

When Amazon first started, it began as a website for only books and as the internet began to expand so did the products that Amazon selling and shipping. Over the course of the last 21 years, Amazon has grown and sells a vast variety of products and has several

Many new competitors join the market strategize on staying in the lead position. These tactics producing more of a challenge for new entrants to capture a substantial amount of market shares. Thus, B & N utilizes aggressive pricing as a strategy which in return helps maintain sales. Not to mention the unbeatable inventory and endless publishers available make it feasible for the retail book store to serve a large customer market. Nonetheless, industries in this regard hold tremendous barriers to entry, but there are companies that are selling online, developing and establishing new

Barnes & Noble are taking different tacks with regard to agreements with authors agents, and publishers. Amazon is pulling content off the market and padlocking it to their Kindle. In response, Barnes & Noble is refusing to stock Amazon published titles in its brick-and-mortar stores. Barnes & Nobles' investment in the well-received, well-reviewed Nook appears to have been a solid business decision, the ripples of which will continue to be felt for some time. In fact, the Nook is the proverbial finger in the dike as the waters of Amazon continue to threaten the very infrastructure of the publishing business by eroding the relationship between publishers and bricks-and-mortar stores.

Amazon has the power to discriminate prices based on the consumer or just raise prices to make up for their losses. Khan states that people do not understand how pricing and online markets work and that the government has missed out on the “anticompetitive implications of Amazon’s below-cost pricing”. The main story and problem Khan refers to in the Yale Law Journal is Amazon’s monopoly over e-books. Khan mentioned many ways Amazon can manipulate the e-book market to their liking. Authors recently wrote an article to the Department of Justice saying Amazon has “extract[ed] vital resources from the [book] industry in ways that lessen the diversity and quality of books” and this is not benefitting consumers (Khan).

Amazon is a company that sells many open product categories online by allowing customers to take the time to search and shop through the product offerings. Many product categories that are offered on Amazon may include device accessories, kindle devices, beauty, books, electronics, health & personal care, etc. The foremost product category that can offer the greatest advantage compared with a retail store chain is most definitely the books category. Reason to this is that the company has expanded the customer’s online shopping experience by offering such a wide range of physical and electronic books, depending on the preference of the customers. They are able to search for the top-rated selling

HP’s suppliers have a high level of bargaining power mainly because of the type of industry it is in. HP is in the electronics industry. A PC or a printer is made up different components, some of which are sold by large reliable suppliers while some are sold by specified manufacturers. HP has over 50 suppliers for its manufacturing. This is good for HP as it has greater control over suppliers in terms of price, quality and delivery schedules.