Assignment 2: Internal Environmental Scan/Organizational Assessment This section provides the opportunity to develop your course project. Conducting an internal environmental scan or organizational assessment, provides the ability to put the strategy audit together. In this module, you will conduct a comprehensive assessment of the internal environment at your business unit or organization you are working with for this project, also known as an organizational assessment, and present your findings in a report. In your report, you should analyze the operating characteristics and assets of your business unit. The SWOT model is one of the most common business tools used during organizational assessment. Another is developing a balanced scorecard based on a prescribed or planned set of performance objectives that will be measured and evaluated regularly. In this assignment, based on the external environmental scan you conducted in M2: Assignment 2 and the internal environmental scan in this assignment, you will develop a SWOT analysis and a balanced strategic scorecard. Part I: Internal Environmental Scan (2–3 pages) The internal environmental scan or organizational assessment should include the following: · Mission, vision, and values: Assess the organization’s understanding of the mission, vision, and values, and how they relate the business strategy. Is there consensus on the mission and vision of the organization? What are the shared values of the organization? What are the behaviors espoused by these values? · Strategy clarification: Assess the organization’s understanding of the business strategy through the interview with a mid-level or senior manager. Assess his or her understanding and agreement of the business unit’s value proposition, market position, and competitive advantage. · Cultural assessment: Explain the unwritten rules and shared values that govern behaviors in the organization. Do they act as enablers or blockers to the strategy? For example, is there a culture of information sharing and collaboration that enables the organization to respond quickly across structural boundaries to solve problems for customers? On the other hand, do groups not share important information through informal mechanisms, thus slowing response times? · Value chain analysis: Identify the primary (direct) and support (indirect) activities that create and deliver your product or service to your customers. Assess each activity’s contribution to competitive advantage through cost or differentiation. Identify any areas where the business may be at a competitive disadvantage. · Summary of findings: Using these different analyses, identify the organizational strengths and weaknesses as they relate to the business strategy. Organizational strengths are assets, capabilities, and resources that contribute directly to the organization’s strategic fit, differentiation, and competitive advantage relative to competing organizations. Organizational weaknesses are ch ...

1. Assignment 2: Internal Environmental Scan/Organizational
Assessment
This section provides the opportunity to develop your course
project. Conducting an internal environmental scan or
organizational assessment, provides the ability to put the
strategy audit together.
In this module, you will conduct a comprehensive assessment of
the internal environment at your business unit or organization
you are working with for this project, also known as an
organizational assessment, and present your findings in a report.
In your report, you should analyze the operating characteristics
and assets of your business unit.
The SWOT model is one of the most common business tools
used during organizational assessment. Another is developing a
balanced scorecard based on a prescribed or planned set of
performance objectives that will be measured and evaluated
regularly. In this assignment, based on the external
environmental scan you conducted in M2: Assignment 2 and the
internal environmental scan in this assignment, you will develop
a SWOT analysis and a balanced strategic scorecard.
Part I: Internal Environmental Scan (2–3 pages)
The internal environmental scan or organizational assessment
should include the following:
· Mission, vision, and values: Assess the organization’s
understanding of the mission, vision, and values, and how they
relate the business strategy. Is there consensus on the mission
and vision of the organization? What are the shared values of
the organization? What are the behaviors espoused by these
values?
· Strategy clarification: Assess the organization’s understanding
of the business strategy through the interview with a mid-level
or senior manager. Assess his or her understanding and
agreement of the business unit’s value proposition, market
position, and competitive advantage.

2. · Cultural assessment: Explain the unwritten rules and shared
values that govern behaviors in the organization. Do they act as
enablers or blockers to the strategy? For example, is there a
culture of information sharing and collaboration that enables the
organization to respond quickly across structural boundaries to
solve problems for customers? On the other hand, do groups not
share important information through informal mechanisms, thus
slowing response times?
· Value chain analysis: Identify the primary (direct) and support
(indirect) activities that create and deliver your product or
service to your customers. Assess each activity’s contribution to
competitive advantage through cost or differentiation. Identify
any areas where the business may be at a competitive
disadvantage.
· Summary of findings: Using these different analyses, identify
the organizational strengths and weaknesses as they relate to the
business strategy. Organizational strengths are assets,
capabilities, and resources that contribute directly to the
organization’s strategic fit, differentiation, and competitive
advantage relative to competing organizations. Organizational
weaknesses are characteristics and capabilities (often lacking)
that place the organization at a disadvantage relative to
competitors.
Part II: SWOT Analysis (1–2 pages)
Your SWOT analysis should summarize the opportunities and
threats from the external environmental scan with the strengths
and weaknesses from your organizational assessment or internal
environmental scan.
Your output should include a matrix depicting strengths or
weaknesses on the horizontal axis and opportunities or threats
on the vertical axis. This matrix will reveal a set of strategy
forces that can be used to assess the current strategy and
identify important potential changes to the strategic direction of
the company.
In creating your SWOT analysis, look for natural pairings of
internal and external factors that match internal resources and

3. capabilities to the external environment. Internal strengths and
external opportunities depicted in the upper-left quadrant on
your matrix might form complementary pairs that suggest
necessary strategic focus for the business unit to pursue
opportunities that fit its competitive strengths. Conversely,
internal weaknesses and external threats shown in the lower
right quadrant of the matrix may combine to illustrate the need
for a defensive strategy to avoid becoming highly susceptible to
competitive threats.
Your matrix should not simply be a collection of four lists
compiled together in a matrix. Your analysis should combine
factors and explain why specific strengths complement specific
opportunities, and selected weaknesses are amplified by
external threats. In addition to your matrix, provide a brief
narrative that summarizes the main findings in your analysis
and the implications for the current and projected strategy.
Part III: Balanced Strategic Scorecard (1–2 pages)
Use the balanced scorecard or another similar tool to
recommend indicators and measurements that will tell you if the
company is successful or unsuccessful in progressing toward
your vision through execution of strategy.
A balanced scorecard presents organizational performance on
four primary groups of measures:
· Financial
· Customer (external stakeholder)
· Learning and growth
· Internal process
You should develop a strategy scorecard that ties the
performance of your business unit in these areas to its overall
business strategy. The challenge you face is selecting two-to-
three measures in each of the four areas that give a measurable
and reliable indication of the business unit performance in the
key activities that promote strategic fit, customer value, and
sustained competitive advantage.
Write an 5–7-page report in Word format. Apply APA standards
to citation of sources. Use the following file naming

4. convention: LastnameFirstInitial_M4_A2.doc.
The paper should include a cover page, executive
summary/abstract, table of contents, body of paper—proper
headers (mission, vision, and values assessment; strategy
clarification; cultural assessment; value chain analysis;
summary of key findings; SWOT analysis; balanced strategic
scorecard; and references).
By Wednesday, April 13, 2016, deliver your assignment to
the M4: Assignment 2 Dropbox.
Assignment 2 Grading Criteria
Maximum Points
Mission, vision, and values: Assess the organization’s
understanding of the mission, vision, and values, and how they
relate the business strategy. Is there consensus on the mission
and vision of the organization? What are the shared values of
the organization? What are the behaviors espoused by these
values?
16
Strategy Clarification: Assess the organization’s understanding
of the business strategy through an interview with a mid-level
or senior manager. Assess his or her understanding and
agreement of the business unit’s value proposition, market
position, and competitive advantage.
16
Cultural Assessment: Explain the unwritten rules and shared
values that govern behaviors in the organization. Do they act as
enablers or blockers to the strategy? For example, is their
culture of information sharing and collaboration that enables the
organization to respond quickly across structural boundaries to
solve problems for customers? Or do groups not share important
information through informal mechanisms, thus slowing
response times?
16
Value Chain Analysis: Identify the primary (direct) and support
(indirect) activities that create and deliver your product and/or
service to your customers. Assess each activity’s contribution to

5. competitive advantage through cost or differentiation. Identify
any areas where the business may be at a competitive
disadvantage.
16
Findings: Using these different analyses, identify the
organizational strengths and weaknesses as they relate to the
business strategy.
20
Write using ethical scholarship and proper grammar and
mechanics.
16
Total:
100
Running head: PRELIMINARY STRATEGY AUDIT
1
PRELIMINARY STRATEGY AUDIT
11
Preliminary Strategy Audit
Sherry L. Crowe
Argosy University
B6028-T A01 Capstone Experience in Integration & Strategy
Module 3, Assignment 2
Dr. Wan
April 6, 2016

6. Executive Summary
Amazon has made its name in the cloud computing and
electronic commerce industry, and this is down to the fact that
the management has been keen on ensuring that they
concentrate on growing their competitive advantage. The
company has managed to move step by step from the first
business which was simply online bookstore and later
diversified into different other portfolios such as selling of
CDs, Blu-Rays, DVDs and Videos (Antoinne, 2000). This has
been down making great strategies that have ensured that the
company has remained a success that it is today.
In this paper, we carry out a preliminary strategy audit of
Amazon through focusing on the analysis of value proposition,
competitive advantage, and its market position. There is also an
environmental scan that looks at the five forces of marketing.
The paper also looks at the strategic issues that face the
organization and lastly the recommendation of tactics that can
be used to improve the firm’s strategic alignment. The tactics
that have been recommended span from the field of branding,
marketing, alliances, integration, development of products,
globalization as well as diversification.

7. Table of contents
Executive summary/abstract 3
Introduction to company 3
Value Proposition 3
Market position 4
Competitive advantage 4
External environmental scan/five forces analysis 5
Current environment 5
Assessment of external factors applying five forces 7
Strategic issues 8
Summary/Key findings and recommendations 9
References……………………………………………………………
…………………………..11
Introduction to company
Value proposition
Basically, value proposition refers to that statement
provided by the business which gives a summary of the reasons
as to why the customers should be able to buy the goods and
services that are being offered by Amazon. It is a statement
that should have the ability to convince any potential consumer
to believe that the goods and services being offered will be able
to add value or solve the need that they have.
Amazon has a value proposition of convenience and price

8. which does hold true when it comes to all the product categories
that it has. This has allowed the firm to open itself for newer
forms of markets and therefore deepening its customer
relationship. The value is added in the sense that when goods
are accessed easily at an even cheaper price, it satisfies the two
important Ps for the customer without having to go through
tough hustle that most people go through when they shop under
the brick and mortar system (Majumdar, 2006).
Market position
Market position is simply defined as the ranking of a
company, its brands and products in relation to the sales
volumes (Majumdar, 2006). In this case, we look at Amazon’s
sales volume in relation to the sales volume that is being posted
by the competitors. It is more of the position that the Amazon
brand holds in the mind of the consumers.
Amazon is currently considered the second largest e-
commerce company after rising from being a simple only e-book
vendor. The sales volume of the company has continues to rise,
and this is basically due to the fact that the company has
managed to increase its spending in promotion and advertising
which has made its brand even much stronger (Wheelen &
Hunger, 2000). The company has up to 55% of repeat buyers,
meaning that it has managed to make its brand stronger by
doing some of the things that most businesses may see as hard
to do.
According to Forbes, Amazon is rated as the 13th most
valuable brand in the world and the fact that it has managed to
record up 55% repeat buyers it does inform one about the brand
of the company having gotten into the minds of the consumers
and occupied a permanent position.
Competitive advantage
When we want to shortlist the competition that Amazon is
facing will depend on what business sector we are considering
at each and every instance. Apple is one of the competitors that
the company has to face when it comes to books, movie, and
other online content delivery. The company has to contend with

9. the competition that is being pushed forth by iTunes due to the
fact that Apple has iPad, iPhone and MacBook that comes with
it.
Amazon has managed to stand the competition and grab a fair
share of the market in each and every business sector in which
it operates, but the biggest question is; where does the company
get its competitive advantage?
It is important to note that Amazon has an amazing product
range. Imagine having seen the vanishing spray that has been
introduced in football and is being used by referees. The desire
to have it comes into your mind and the moment you hit
Amazon, you can buy it at a click of the button (Minett, 2002).
This is an illustration of the fact that Amazon has realized that
the most important thing to do to beat the competition is to have
everything that the consumers want, even those that may seem
odd.
Bezos in his imagination was able to come up with a business
that can give the consumer a combination of values; superior
customer service, speed, reliability, and choice. In the online
retail market, there are few companies that can provide such a
service at a go. It, therefore, means that the Amazon is beating
most of its competitor based on the fact that they can give a
consumer a combination of values.
External environmental scan/five forces analysis
Current environment
Environmental scanning can be said to be a process of gathering
as well as analyzing of information that is strategic and tactical.
It gathers both subjective and factual information concerning
the business environment a company is operating around.
Internal analysis of Amazon entails the current environment.
This will be analyzed by looking at the SWOT analysis of the
company (Majumdar, 2006). It could be easy to summarize the
Strength, Weaknesses, Opportunities and Threats in Amazon
through having a look at how it operates internally.
A. Strengths; the company has managed to create a global brand
through having a team that focuses on proper research and

10. development. The company has ensured that its online location
is strategic to customers who want speed and accuracy in terms
of the products that they access (Stevens & Stevens, 2006). The
company has a vision that is customer centric, and this is the
reason as to why they have different and diverse products which
satisfy the customers. The company has a strong program in
logistics which is made possible through its application of the
most advanced technology.
B. Weaknesses; the company, unlike the brick and motor
retailers does not have a physical presence. Some customers
may not be convinced of its effectiveness and efficiency. The
company has low-profit margin due to the fact that cost of
goods sold is usually high and hence the cash flows in most
cases are low. In the biggest external market which is China, the
company has not managed to perform well
C. Opportunities; there is new opportunities that come up in the
internet market every single day, currently there is growth in
social networking, growth in digital media which has led to
higher presence of online customers. There is growth in online
movie downloading as well increased market presence in the
market outside the United States for instance China.
D. Threats; it is highly dependent on the external vendor for
quick delivery of the goods, the company does not own any
store of inventory. There is also strong competition from Apple
especially when it comes to the sale of online music. There are
also cases of patent infringement which the company has to
handle frequently.
Assessment of external factors applying five forces
The Porter’s five forces refer to that analytical framework
which shows the five forces which are used to shape the extent
of competition in the industry.
A. Bargaining power of the buyers is great in the online retail
industry. For Amazon, it is unique since the bargaining power
of each buyer does vary from different customer categories
depending on the product's nature and the services that are
being extended. Most customers who purchase in Amazon

11. marketplace possesses the greatest bargaining power since they
have the ability to make a switch to a competitor or a product
that can act as a substitute. The buyers that operate in the
Amazon Web Services are known to have lower power in
bargaining in comparison to those in Amazon marketplace; this
is due to the fact that there is the possibility of incurring some
switching costs.
B. Threats of new entrants; this is a concern that is significant
in the online retail industry. There are certain industry entry
barriers that include retaliation from the current market players
and economies of scale. The potential entrants in most cases
base their advantage on the new and innovative features as well
as the capability of the services that they offer into the
innovative business world as a whole. This means that creativity
and innovation are the two most important elements that play a
key role in terms cutting the impact of the entry barriers into
the market. The fact that there are no costs associate with
switching by customers means that the entrants are more easily
accessible
C. Rivalry among the existing firms; in this industry the rivalry
is intense (Stevens & Stevens, 2006). There are rapid rates of
growth in the industry as well as barriers for exit make up the
factors that raise the intensity when it comes to competition in
online retail and electronic commerce. The company faces
several competitors, and the most notable ones include Netflix,
Inc., Time Warner, and eBay Inc.
D. Bargaining power of suppliers; the power of the suppliers in
this industry ranges from medium up to high (Minett, 2002).
The inventory by Amazon can be obtained from several
different suppliers and therefore the company has a higher
power in terms of bargaining. The company has the ability to
dictate what goes into the online market due to its size, and
therefore less power goes to suppliers.
E. Threat of substitute in the company is high. There are several
alternatives to Amazon products save for the patented
technology. There are also cases of firms that have the online

12. presence as well as a physical presence which challenges
Amazon.
Strategic issues
Amazon is continuing to make a positive growth yet there are
challenges that the company has to deal with.
1. Competition
The competitors are all over the place devising means through
which they will be able to cut the force with which Amazon is
gaining the market share. There are certain strategies that have
been put in place by Amazon which will fail but others will
prosper. There are hundreds of retailers that are fighting for the
online presence, and others are coming up a factor that will
heighten competition for Amazon. Brick and mortar retailers
such as Amazon are getting into the industry and are trying to
match what Amazon has created. This is another avenue of
greater competition.
2. Looming Price Wars
Once the competitors will be able to match Amazon in terms of
delivery speed and interface, the next place where the
competition will move to will be in the price area. Amazon has
a reputation of accumulating market share and not generating
profits. In any case, there is price war, it will dent the business.
3. Risk in the Stock market
Most investors are of the opinion that there is a certain risk that
can be associated with investing in Apple Stocks. The company
has not done well in terms of flexibility, opening up to new
markets and dealing with competition. There is evidence that
the above challenges will impact the manner with which
Amazon operates in future. The company should be considering
having a brick and mortar back up plan to counter entrants such
as Wal-Mart.
Summary/Key findings and recommendations
The fact that the company is faced with the risk in terms of its
performance in the stock market, Amazon should look out for
the areas of concern. The first important thing that should be
done is to ensure that the Chinese market presence is enhanced

13. to increase the amount of revenue. The company also has to
ensure that it deals with the upcoming competition. How what
strategy can the business use to deal with competition?
It is important for the business to show that the competitors are
not in a position to create more value proposition to the
customers in the areas that the company has gained its
competitive advantage such as price, fast and free shipping,
selection as well as overall experience while shopping on
Amazon. This will ensure that the company continues its growth
trajectory.
If the business can build on the above competitive advantages,
there will be no worries even if the rival companies decide to
launch price wars since the consumers are already aware of the
place where they can find value.
References
Antoinne, D. K. (2000). Strategic thinking: An executive
perspective. Upper Saddle River, NJ: Prentice Hall.
Majumdar, R. (2006). Marketing strategies. New Delhi: Allied.
Minett, S. (2002). B2B marketing: A radically different
approach for business-to-business marketers. London: Financial

14. Times/Prentice Hall.
Stevens, R. E., & Stevens, R. E. (2006). Market opportunity
analysis: Text and cases. New York: Best Business Books.
Wheelen, T. L., & Hunger, J. D. (2000). Strategic management
and business policy: Entering 21st century global society. Upper
Saddle River, NJ: Prentice Hall.
Running head: EXTERNAL ENVIRONMENTAL SCAN
1
EXTERNAL ENVIRONMENTAL SCAN
6
External Environmental Scan
Sherry L. Crowe
Argosy University
B6028-T A01 Capstone Experience in Integration & Strategy
Module 2, Assignment 2
Dr. Wan
March 30, 2016

15. In today's business, e-commerce is becoming more effective in
the modern world. Two major companies stand out, one solely
relying on online business and the other both store and online
services. Most individuals are familiar with these companies,
Amazon and Nike. Both of these companies carry strong points
in their own right, and as demand for their products grows, so
does opportunity. Amazon was once very plain and
unattractive, but was still the primary bookseller for consumers
on the Web, and Nike was a small growing firm that made
athletic shoes imported from Japan, making its presence in the
American market.
These days, but with the advent of PESTEL evaluation,
managers have been able to make effective choices for their
organizations. PESTEL analysis lets in a commercial enterprise
to conduct an, "analysis of 4 outside elements which could
impact the overall performance of the agency. Those factors
are: Political, monetary, Social, and Technological" (CBS
commercial enterprise network, 2011). Amazon has used these
elements capitalizing on their strengths to threaten their
increasing market. For example, through a technological factor
of view, telecommunications technologies for the internet have
been growing, giving consumers the potential to shop for their
domestic computers, laptops, and cellular telephones. This is
relevant to Amazon because it will increase the frequency of
use and sources for net by means of on-line customers.
Amazon has integrated cloud computing into their business
approach, supplying them the edition with the generation and
cultural transitions. Cloud Computing gives individuals the
potential to get admission to programs at any second, "having
every piece of statistics you want for each thing of your
existence at your fingertips and ready for use" (PC Magazine,
2011). Amazon has been looking to enhance internally with the
use of their cloud computing market to beautify their internet
services, attracting extra clients to their website, "Amazon web
services desires to be the information center for the sector"

16. (Bloomberg, 2011). The method of Amazon in cloud computing
is to influence purchasers its big databases and internal studies
and improvement strengths imparting effective tools, "whilst
cloud computing is adopted via an employer, they'll discover
themselves thrown into the pool with the relaxation of the web
global in many approaches" (ZD internet, 2011).
Nike any other chief in its market, founded in 1962 by way of
invoice Bowerman and Phil Knight. What commenced out as a
distributor of Jap athletic shoes to American purchasers later
have become a traditional and non-traditional distributor for
extra than100 countries focused on its number one market areas:
America, Europe, Asia Pacific, and the Americas (searching for
Alpha, 2011).
Unluckily, one most important factor that Nike has fallen
towards criticism through outdoor, outside forces is their
proportion of troubles with exertions and manufacturing unit
conditions resulting in awful publicity and declining income.
Purchasers trust that Nike, Inc. has a social obligation as a
company to fix situations together with labor and factory
conditions.
Nike lays several quantities of techniques to fool their
customers, athletes, and sportsmen. Nike strives on brand
picture, its affiliation with a unique emblem and slogan "just do
it" facilitates popularize their photograph globally in all areas
of game and style. Nike's advertising method includes emblem
image, Nike's website, customer choice, and product
differentiation, which helps them separate themselves from the
competition. They goal the pleasant, professional athletes and
athletic teams, giving Nike the ability to attain a big amount of
athletes. Following their technique in selling their photograph,
Nike applies its merchandise by using associating fulfillment
with product. For example, while an athletic crew or athlete
sponsors Nike's emblem of athletic footwear, the logo can be
paired with a success story. This shape of advertising may be
described as emblem positioning or brand architecture. Brand
positioning can be satisfactorily defined as a motivating reason

17. to buy one's product over others, "is guided, directed and
brought via the emblem's blessings/reasons to buy; and it
focuses at all points of touch with the patron" (Seeking Alpha,
2011). Nike creates cost and sustains aggressive gain over other
competitors with this technique because a photograph is a
massive thing in trendy markets, a large variety of customers
are possibly to broaden product intimacy; individuals who care
extra about the best in place of the rate. This takes us to Nike's
rate approach, which they target customers who cognizance
more on product intimacy and care much less approximately the
charge. Giving Nike the benefit over different competition,
placing better expenses for its merchandise; customers who
accept as true with a product to be of high fine are at risk of pay
a higher fee.
Apart from marketing strategies Nike has embellished on the
expanding market of technology. In efforts to collaborate with
issues of climate change in business, the challenges and
opportunities that growing organizations seek, Nike has
designed a tool to advert such issues. They released a version
of their Environmental Apparel Design Tool back in December
2010 in hopes that companies would use it and build from it. In
efforts to stay competitive within their market and sustain a
leadership of sports apparels, Nike has given designers this tool
to gather information on their designs at earlier stages of
production, "constantly giving them feedback and educating
them on how to make better choices" (Bardelline, 2010). This
sets Nike apart, giving the organization a competitive
advantage.
CONCLUSION
In this rising market, measurement guidelines are tough to come
by. Organizations can calculate market share and profitability
to help measure their success, but it can a bit difficult at times
to compare. Nike is the largest company between the two, and
looking at profitability it overshadows Amazons. Although
Amazon continues to move forward, and its brand recognition
and customer loyalty is strong. Using profit as a measurement

18. guideline could be effective, but companies will need to keep
track of different market segments to ensure they are not
accepting less than the best outcome. Both companies have
their strengths and advantages within their markets, Amazon
leaders of e-commerce and Nike leaders of brand positioning to
market its products. Whatever the future brings, it is clear that
these two strong brands will continue their traditional core
businesses techniques in search of additional lines of business.
References
Bloomberg. (2011). Amazon looks to Widen Lead in Cloud
Computing. Retrieved from
http://www.businessweek.com/technology/content/apr2010/tc20
100428_085106.htm
CBS Business Network. (2011). PEST Analysis. Retrieved from
http://www.bnet.com/topics/PEST+Analysis
Management Study Guide. (2011). Brand Positioning -
Definition and Concept. Retrieved
from http://www.managementstudyguide.com/brand-
positioning.htm
PC Magazine. (2011). What is cloud computing? Retrieved from
http://www.pcmag.com/article2/0, 2817, 2372163, 00.asp

19. Seeking Alpha. (2011). Nike Inc. (NKE) Description. Retrieved
from http://seekingalpha.com/symbol/nke/description
ZD Net. (2011). Eight ways that cloud computing will change
business. Retrieved from
http://www.zdnet.com/blog/hinchcliffe/eight-ways-that-cloud-
computing-will-change-business/488
Running head: MARKET POSITION ANALYSIS
1
MARKET POSITION ANALYSIS
4
Sherry L. Crowe
Argosy University
B6028-T A01 Capstone Experience in Integration & Strategy
Module 1, Assignment 3
Dr. Wan
March 23, 2016

20. This market position analysis is an assessment of the value
proposition and the competitive advantage of Amazon.com, an
effort to provide insight into its product portfolio. Amazon.com
is the largest internet retailer that is based in the United States.
The company’s products range from electronics, electronic
books, media (movies and music), games, groceries to home
bases items like toys and the like. The company was founded in
the year 1994 and its headquarters is based in Seattle,
Washington. This information was acquired by means of an
interview with an anonymous senior level manager in the
company.
The first issue under scrutiny during this interview was the
target market. Amazon.com was once the world's largest
bookseller. The company therefore targets customers globally.
It internet presence has proved to be a crucial asset in terms of
how it advertises, sells and distributes its products worldwide,
It is, therefore, able to penetrate and reach the most of the local
markets in the world.
The company strives to achieve its main objectives by being the
most customer focused company in the whole world. The
company is therefore driven by obsession in its customers
instead on focusing on its competitions, innovation, and
successful, efficient operations. Amazon has two major
segments i.e. the Northern American segment and the
international customer segment. The company is therefore
basically managed on a geographical basis. Its presence in the
two segments is therefore facilitated by operations headquarters
that oversee the company’s operations.
Amazon focuses on product selection, price, and convenience.
The company has established internet platforms that enhance its
convenience by enabling the sale various unique products by

21. either the company or third party retailers. The products are
very diverse and are available under various categories to
enlarge the consumer base. Consumers, therefore, access these
products through these internet platforms and Amazon
applications that are at their disposal. The company strives to
offers its customers the lowest possible prices by pricing its
products on a daily basis with regard to market fluctuations. It
also offers the consumers affordable shipping deals. An
example of this is a membership program that is offered by
Amazon Prime annually. The program entails free unlimited
shipping and free streaming services for digital content or free
access to the Kindle device.
The company is very competitive and aggressive in its strategic
management. It, however, faces competition from physical retail
stores all over the world, vendors and the producers of its
products. It also faces competition from other electronic
commerce parties and companies that sell digital content
through the internet and other online retailers. Media companies
and online media portals are also becoming very crucial
competitors.
Amazon focuses on product selection, price and the convenience
of its delivery systems. It achieves convenience through its
retail web services i.e. Amazon.com and Amazon.ca. The online
retail store also partners with third-party entrepreneurs through
the establishment of programs that allow them to sell their
products on these websites and their sites.
The modern man is a being of very sophisticated tastes and
needs. Product differentiation is a strategy that is aimed to
capitalize on these sophisticated needs and at the same time
increase the market size by enhancing the consumer base. This,
Amazon achieves by ensuring that every particular need is
addressed by stocking goods from various producers, various
brands, and quality.
Amazon draws its competitive advantage from two main ideas
i.e. its strategy and its brand. The founder of Amazon, Jeff
Bezos created an ingenious strategy which he referred to as the

22. cunning plan. The ingredients of this plan include the diverse
choice of products, the reliability, speed and the superiority of
the company's service to its customers. With the aid of this
strategy, Bezos broke through the industrial mindset of the
market by providing the customers with the ability to browse
through make orders and receive shipments of the purchased
products at their convenience.
The other crucial ingredient of the cunning plan from which
Amazon draws its competitive advantage is its brand. As Bezos
visualized the venture, he dreamed of a worldwide retail
network. He wanted his venture to be like the Amazon River.
The company is however not only interesting as a result of its
competitive advantages. This is because it has an impeccable
marketing strategy. The strategy has it that the company’s
products offer a very superior value to the customers, with a
price premium that is very definite (Jay, 2013).
At the moment, Amazon has dominance over the digital market
that the possibility of another online store knocking off its game
is very slim. The fact that the company enjoys very substantial
economies of scale gives it the power to offer the lowest retail
prices. The company is also extremely networked throughout its
two major segments through a series of warehouse and delivery
systems. It also has a massive base of credit card subscribers
that make it next to impossible to compete with the retail store.
References
Amazon.com Inc. (2014). Retrieved March 23, 2016, from
http://www.annualreports.com/Company/amazoncom-inc
Grundy, T. (2015, May 29). The source of Amazon’s

23. competitive advantage. Retrieved March 23, 2016, from
http://www.accaglobal.com/za/en/discover/cpd-
articles/business-management/amazon-flow.html
Jay, B., (2013). Gaining and Sustaining Competitive Advantage
(4th Edition). Amazon.com: (9780136120926):