0
Issues and recommendations on amazon
Issues ①
 Net sales shows the drastic growth by expanding the categories of products
 ROS is very low and it’s going dow...
Issues ②
 Sales of ‘other(new business)’ from international segment hasn’t expanded for 3 years
 Profits from internatio...
To prevent being commodity service

Horizontal
integration

New
services

Vertical
integration
SWOT analysis of Amazon
Strength:

・Low price
・e-Commerce system
・Logistics
・Long tail business

・・・・ Volume discount base...
New service of Amazon
For
・Amozon can supply materials for manufacturing companies
such as Automobile, Electronics, Pharma...
New service of Amazon
For
Buyers’ merit
・ to buy lower price and in small lot using buying
power of Amazon.
・ especially b...
Horizontal integration
• New service in the existing market
– Amazon Travel
– Amazon Auction
– Amazon Insurance

• Develop...
Horizontal integration
GDP (2012)

Already on business

Potential market
Vertical integration
• The value amazon has
Mercha
ndiser

• Books
• Music
• Consumables

One-to-One system

Deliv
ery
• Y...
Vertical integration
• Recommendation idea
amazon
Supply amazon’s data
to manufacturers

amazon integrated
platform with
m...
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Amazon strategy

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Transcript of "Amazon strategy"

  1. 1. Issues and recommendations on amazon
  2. 2. Issues ①  Net sales shows the drastic growth by expanding the categories of products  ROS is very low and it’s going down in 4 years. Profitability is a key issue of Amazon.  As the Categories of products will be limited, new business domain will be necessary. 70,000 10.0% Net sales ROS 60,000 61,093 8.0% 48,077 50,000 $ Mil. 40,000 6.0% 3.4% 30,000 20,000 3.7% 34,204 3.4% 4.0% 24,509 19,166 2.0% 1.3% 0.0% -0.1% 10,000 0 -2.0% 2008 2009 2010 2011 2012
  3. 3. Issues ②  Sales of ‘other(new business)’ from international segment hasn’t expanded for 3 years  Profits from international segment remains low North America 40,000 30,000 Other EGM Media International 40,000 Sales 30,000 20,000 Sales 20,000 10,000 Other EGM Media 10,000 0 0 2010 2011 2012 2010 2011 2012
  4. 4. To prevent being commodity service Horizontal integration New services Vertical integration
  5. 5. SWOT analysis of Amazon Strength: ・Low price ・e-Commerce system ・Logistics ・Long tail business ・・・・ Volume discount based on buying power ・・・・ User friendly I/F and Payment system ・・・・ Speedy delivery, Bar code system ・・・・ Providing niche products Weakness: ・Logistics center cost Opportunity: ・B to B business ・・・・ Company owns their e-commerce system and makes contracts with each supplier. ⇒Small company doesn’t have buying power for cost down. ⇒They are difficult to find better suppliers and products. Threat: Yahoo, Rakuten, Google, Apple
  6. 6. New service of Amazon For ・Amozon can supply materials for manufacturing companies such as Automobile, Electronics, Pharmaceutical company etc. For example: Automobile for Automotive, Amazon for Electronics etc. ・They also provide products for small firms, venture companies. ⇒Amazon for Business is effective for small companies. Items: ・Electrical parts, Semiconductors, Rare metals, Chemicals etc.
  7. 7. New service of Amazon For Buyers’ merit ・ to buy lower price and in small lot using buying power of Amazon. ・ especially benefit for small company ・ not to own their e-Commerce system ・ to find good suppliers by users’ grading and comment Suppliers’ merit ・ easy to participate to network to expand their sales ・ not to own e-Commerce system Issue: Security for business use
  8. 8. Horizontal integration • New service in the existing market – Amazon Travel – Amazon Auction – Amazon Insurance • Developing a New market (country) – Australia – South Korea – Indonesia
  9. 9. Horizontal integration GDP (2012) Already on business Potential market
  10. 10. Vertical integration • The value amazon has Mercha ndiser • Books • Music • Consumables One-to-One system Deliv ery • Yamato HD • Yubin Improving customer experience Technolog y • Big data • Data storage • Mining skill 1. 2. 3. 4. Recommendation Customer-matched design Usability Customer review
  11. 11. Vertical integration • Recommendation idea amazon Supply amazon’s data to manufacturers amazon integrated platform with manufacturers - New BtoB business to maximize customers’ value Big data Manufacturers Purchase & website view Purchase Customers R&D
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