1. BRIEFLY ANALYSE THE COMPANY
EXPLAINING WHAT YOU SEE AS ITS MOST
IMPORTANT FEATURES IN RELATION TO
EACH OF THE THREE HORIZONTAL LAYERS
IN THE FRAMEWORK PROVIDED, AND
PROVIDE JUSTIFIED ANSWERS TO THE
THREE QUESTIONS THAT FORM THE
VERTICAL COMPONENTS OF THE
FRAMEWORK (‘WHAT MAKES IT
SUCCESSFUL?’, ‘WHERE DOES IT POSITION
ITSELF?’ AND ‘HOW DOES IT ACHIEVE
SUCCESS?’).
3. SECTOR AND OWNERSHIP – PUBLIC,
PRIVATE OR THIRD SECTOR. OWNED BY STATE,
SHAREHOLDERS OR OTHER.
Amazon is a privately owned but publicly traded company on the
NASDAQ stock exchange. The company is essentially owned and
controlled by the shareholders.
Private Sector
Public Ownership
4. OFFERING – PRODUCT/ SERVICE/ MIXED
Services: Web services; Amazon credit card; Love film (rental service);
Marketplace
Products: books; consumer goods; Audible (audio books); kindle; e-
books
Mixed, they have products and services
5. FINANCIALS – TURNOVER, SIZE, GROWTH,
PROFIT, RATIOS
Turnover: $48bn
Size: Money, employment (depending on argument);
number of customers and how that has grown. Number of services.
Growth (LY vs TY): $14bn increase (29.16%)
Profit: $631M (2011)
$1152M (2010) - (Decrease: $ 45.3%)
Financial Ratios:
Gross Profit Margin (Gross Profit * 100 / Sales Revenue)
10,789 * 100 = 1,078,900 / 48,077 = 22.44%
6. POSITION – SUPPLIERS/ CUSTOMERS
Suppliers:
Market place allows individuals to become suppliers.
Book publishers
Server and infrastructure providers
Utilities
Couriers
Packaging suppliers
Credit card supplier
Customers:
Online consumers – book readers – segment customers – who buys what
– customer retention – customers that shop only at xmas. How can ypou
pull them in?
SME owners – web services
7. TARGET MARKET – RETAIL, BANKING,
MANUF
SME’s for web services & product advertising & distribution
Internet users, willing to purchase online
Online retail & online services
8. BRICKS/CLICKS – INFRASTRUCTURE;
TECHNOLOGY; STORES
Clicks – solely online; technical infrastructure in place to support their
store-front and their back end web services. They have a system in place
to manage their supply chain, which is passed on to end users of their
service.
Servers; domain name servers; virtual store;
Data centres etc.. Warehouse, depots
9. BUSINESS MODEL – HOW THE BUSINESS
ACHIEVES SUCCESS
By incorporating a wide range of products; aimed at a large demographic.
By targeting SME’s Amazon is able to expand their service offering to
businesses in the form of web services and hosting. By making products
available and desirable to such a wide audience, they achieve financial
success.
They tailor their services and recommendations to each individual
customer. This means that their product recommendations are relevant to
the customer.
Different delivery options cater to different users needs, meaning that
customers can receive goods as quickly as they need them. Amazon
Locker is used as a delivery ‘depot’ for amazon parcels. This removes the
last-mile delivery costs, and provides a centralized, secure location for
customers to retrieve their goods.
10. UNIQUE SELLING POINT– WHAT DOES
IT OFFER TO SURVIVE AND THRIVE
Customer satisfaction; recommendations; targeted email marketing; one
click buy;
Sense of trust – buying from a random merchant through Amazon
11. MARKETING – WHAT APPROACHES AND
CHANNELS DOES IT USE
Email based marketing; Kindle TV adverts; Word of mouth; Customer
recommendations
12. WHAT MAKES IS SUCCESSFUL
USP – delivery options & customer centred approach, marketing methods
(targeted mail)
Relationship with suppliers – marketplace gives vendors the ability to
leverage Amazon’s trusted brand name
Consumer protection & reviews provide advice which adds value to their
service
Incentives for reviews – free delivery
Easy returns policy – instils trust
Private ownership – incentive of money
13. WHERE DOES IT POSITION ITSELF
Amazon position themselves as a provider of a wide range of consumer goods,
delivered via multiple vendors from their market place services. Amazon are able to
leverage other manufacturers, and suppliers delivery, manufacturing and service
offering, and deliver them as if they were its own. The multiple vendors mean that
Amazon positions itself as a one stop shop to buy multiple products from different
geographical locations, with a single one-click checkout process. This simplifies the
process for the customer and enhances their experience with the company.
The web-services aspect of the business model covers the business from a SME
standpoint. This means that the company positions itself to cater to both the
individual consumer market AND the small and medium enterprise market.
Amazon also positions itself as an entertainment provider, by adopting Love Film
and Audible services to offer as a consumer
14. WHERE DOES IT POSITION ITSELF
The company USP (as discussed) centres around their ability to instil trust in their
consumers and their reputation as a trusted brand. By being well known as a
trusted consumer brand, they position themselves for success in the SME market
with their webs services.
By enhancing the customer experience with an easy to use (one click buy and
website) they are able to further build their reputation with individuals, which further
helps to support the notion that their web services can support their SME’s without
a substantial learning curve.
15. WHERE DOES IT POSITION ITSELF
Specific services for example mother & baby
Subscribe and save Caters for peoples everyday (consumable) needs
Frequent users obtain a free delivery service
Target entertainment industry – love film & audible
16. HOW DOES IT ACHIEVE SUCCESS
Critical numbers – quick comparison with competitors
Maybe discuss how operational costs (R&D) help support new services
Profit margins (gross and Net)
Bricks and clicks – solely online – no storefront costs, limits the number of
staff required, by utilizing marketplace it enables amazon to limit staff
numbers (leveraging from other sellers). 24/7 selling; IPHONE &
ANDROID APP (buy on the go)
Marketing – analyses buying habits and trends to market to specific
individuals
