Wednesday, May 20, 2009

SWOT Analysis: Amazon.com







E-commerce has changed more usual and essential marketplace for customers by developing computer technology. One of the online shopping sites, Amazon.com, is an American e-commerce company, and it was established by Jeff Bezon and his friends in 1994. Bezon who is from Albuquerque in New Mexico opened Amazon.com as an online bookstore at first. He has extended its scale year by year. Nowadays, Amazon.com companies exist in many other countries’ network such as United Kingdom, France, and Japan, and Amazon.com has been sold valuable goods; not only books, but there are also sold electric, beauty, and camping goods in Amazon.com. Thus Amazon.com is really a huge internet industry, and it is recognized as “a pioneer” or “a role model” of the e-commerce. Some people think that Amazon.com is a great e-commerce and recommend following them. On the other hand, others state that Amazon.com is no more the role model and recommend not copying them. I will use SWOT analysis to show the qualities of Amazon.com, its goals and its achievement.



- What Is SWOT Analysis?


SWOT analysis is a planning exercise in which managers identify internal organizational strengths (S) and weaknesses (W) and external environmental opportunities (O) and threats (T). To achieve the mission and goal, the strategy of SWOT analysis is used.



- Amazon.com press room pages


“Amazon.com strives to be the Earth’s most customer-centric company where people can find and discover virtually anything they want tot buy online.”



STRENGTHS

  • Everybody can find virtually any item with lower prices especially, Books, DVDs, and music. Amazon.com has expanded to provide music download called “amazonMP3,” which is 10 cheaper than iTunes.

  • Amazon.com has produced wireless reading device called “Kindle.” Subsequently, electronic books for the Kindle can be bought from only “amazonKindle,” hence as a result of the monopoly, they make a lot more profit from selling the kindle and its compatible electronic books

  • Shipping free and time delivery service. When people purchase items which Amazon.com holds more than $25, the shipping cost will be free. To receive items safely, people can order Guaranteed Accelerated Delivery that buyers can choose delivery speed.

  • Amazon.com is recognized worldwide as it has international sites; Canada, United Kingdom, Germany, Japan, France, and China.

  • Amazon.com collects information on each customer’s likes and dislikes based on what they view or purchase on the site, while constantly making suggestions through e-mail on items the customer might like to view or purchase.







WEAKNESSES

  • Amazon.com does a daily check and a constant maintenance of its server to ensure the functioning of its systems. These are checks are costly and risky as a failure in any of its systems could lead to a loss of customers.
  • Amazon.com has sold daily goods such as cleaning cloths. Most of customers do not purchase by online, and they get in offline retail stores because it is faster and to get.


OPPORTUNITIES

  • E-commerce partnership with popular retailing companies such as Target, Toys R Us, and Macy’s.
  • If Amazon.com holds the market share of iPod, it can promote amazonMP3 as same as Kindle and amazonKindle.
  • Collaborations with the public sector. For example, Amazon.com benefit from public library to provide a search engine and catalogue for customers or users that they can find rare and antique books.


THREATS

  • Amazon.com is difficult to compete with other online stores such as eBay because both of them are selling similar products and having similar categories of products. Online stores normally sales huge range of products that are produced by other companies. If Amazon.com does price competition, it will damage about loss profit.
  • Worldwide of Amazon.com is not strong enough to compete. Because international Amazon website is same as Amazon.com, and it is not each country’s favor. For example, a display of Amazon.com is same as a display of Amazon.co.jp (Japan). If Amazon.com wants to establish customer loyalty in Japan, it needs to customize its webpage differently: Amazon needs to consider recent Japanese events, so that they can make a new section for a short-term. Amazon.com can make a lot more profit at Christmas, but Amazon.co.jp cannot do.


As the result of SWOT analysis, Amazon.com has very high qualities as e-commerce, which became No.1 in the Internet Retailer Top 500 Guide in the fourth quarter of 2007. Amazon’s mission is providing a place to buy easier and faster, and enjoy doing shopping for everybody. As internet marketing strategies, it is important for Amazon.com to consider customer value and marketing relationship for loyalty. To keep being high e-business, Amazon.com needs to improve on point of customer value.







-Resources

Amazon.com:

http://www.amazon.com/gp/help/customer/display.html?nodeId=3510241

http://www.amazon.com/gp/help/customer/display.html?nodeId=527692

Others:

http://www.usatoday.com/tech/news/2006-07-18-amazon-target-renew_x.htm

http://www.echeat.com/essay.php?t=27362

http://www.samples-help.org.uk/mission-statements/amazon-mission-statement.htm

5 comments:

  1. I recently came across your blog and have been reading along. I thought I would leave my first comment. I don't know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.

    Lucy

    http://dataentryjob-s.com

    ReplyDelete
  2. Love to see this discussion! It’s great to see you all working through the issues and also, it’s great to see recommendations for testing. In the end, it’s what your actual users do and prefer that should be your biggest driver in making these decisions.
    Great article and discussion!
    online marketing

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  3. This comment has been removed by the author.

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  5. Great amazon.com strengths you've revealed in here. thank you

    Amazon SWOT analysis

    ReplyDelete