Amazon's Marketing Strategy

1993 Words8 Pages
Abstract
The purpose of this paper is to evaluate the marketing process of online retailer Amazon.com, Inc. Amazon.com provides a number of retail services as well as web and storage services. The corporate strategy framework, as discussed in Cravens & Piercy’s Strategic Marketing text, will be used to examine the background of the company and define its current position. The corporate framework includes the following: (1) corporate vision (2) corporate objectives toward vision (3) resources (4) business composition and (5) business design. The marketing strategy of the company will be reviewed using Cravens & Piercy’s suggested marketing strategy process. To assess the current marketing problems and opportunities, this paper
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Kargar reports, “the company had a weak balance sheet [and] massive negative operating cash flow” (Kargar, 2004). Throughout the company’s financial history there have been many monetary losses. According to Robert D. Hoff and Heather Green, in 2002, “the company still carried $2.2 billion in long-term debt” (Business Week, 2002). In International Journal of Cases in Electronic Commerce, Pauline Ratnasingham reports that “Amazon.com shareholders lost 80% of their value in 2000” (Ratnasingham, 2006). Though sales increase rapidly, losses continue to soar as well. Despite the financial failures, in 2006 Bezos’ still believed that his investments would yield big payoffs in later years and that Amazon.com would be a “meaningful business...one day” (Hoff, 2006).
As Amazon.com continued to expand, the company’s strategic business units (SBU) consisted of four key divisions: (1) U.S. Books/Music/DVD/Video (2) U.S. Electronics, Tools, and Kitchen (3) Services and (4) International (Ratnasingham, 2006). This business composition makes it easier to focus on separate specific strategies for each unit. The company’s business model also provides a competitive advantage. Amazon benefits from being able to maintain a virtual store front with distribution centers located in low rent areas. In all, a combination of convenience, speed, reliability, discounted

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