Amazon, a company that started with just selling books is now a company that owns more than half of the online retailing market on a global level and the list is long when it comes to the list of what Amazon has achieved throughout its journey till now, how Amazon provides its customers with millions of products which is a single click away and what innovations the brought in its delivering method and customer service. Amazon’s future strategy for smooth running of the business.
The e-commerce market place is something which started 2 decades ago and is now a 400+ million-dollar market. The market where sale of physical good takes place through a digital channel is the most common way people buy goods these days. Amazon is the largest online retailer on a global level with more than 300 million active customers. Amazon sells almost 12 million products ranging from clothes and tools to home and kitchen related goods.SWOT analysis
Amazon is world’s most dominating e-commerce website which offers millions of products with different brands from A to Z. However, everything has Strength, Weakness, Threat and Opportunities (SWOT), here is Amazon’s SWOT analysis.
Strengths: The main plus point for Amazon is that, it takes less time to deliver goods as compared to others. Moreover, they do provide express and a day drone delivery. Also, it provides us most products on a single platform.
Weaknesses: The express and a day drone services are not available in whole world it is only available in North America. The products we get from amazon no doubt gives us full details but still we cannot check the quality of product until we have it in our hand.
Threats: The biggest rival and threat for Amazon is Wal-Mart because of its huge network of physical locations everywhere where Amazon still needs development.
Opportunities: The biggest opportunity for Amazon is to grow its physical network into areas that are yet to be covered by Amazon. Another opportunity for Amazon is to increase the number of the grocery store Fresh Food Market with automatic cash deduction powered by Amazon.
Amazon’s global impact on retailing environment
“Amazon is a case study in ceaseless innovation and interminable disruption,” says Artemis Berry
Amazon now with a giant 53% market share of the total e-commerce market has a long list of changes which took place for amazon and many trends that Amazon started. There was a time when Amazon was just into selling books, but it has come a long way as now not only it has set a benchmark fir offering its customers convenience which no other competitors can match. The following are the recent changes and trends that Amazon has started:
Buying grocery will never be the same with Amazon’s acquisition of Whole food market, when Amazon bought the company Whole food market it came up with a brand-new trend of its customers just going inside the store and picking up whatever the customers want and leaving without waiting to pay with automatic deductions from the e-wallet.
Taking over the auto- parts market, in the year 2017 Amazon signed major deals with auto parts manufacturers to sell their products on Amazon to break the stereotypes of selling in brick- and -mortar stores and selling auto parts online with its quick delivering capabilities.
Customer Relationship Management
Amazon is well known for its customer relationship management. Amazon is ranked as ‘the most trusted online shopping site.’ Customers can easily search for any category of product and also, they can see highly detailed images of the products, pricing and ratings and many more. Shopping on Amazon is like one is doing shopping in a grocery store. If any customer gets wrong product, at that time Amazon protect its customers. When third party sellers make hash of orders, then they are required for refunds. And if Amazon makes any mistake by itself, they correct it immediately. Customer Relationship Management plays huge role in making Amazon the most loyal & trusted shopping site.
Possible Strategic Directions of Amazon
Inventory Management: An Inventory Management System is a sum up of hardware and software which is used to operate and maintain the goods. It also involves the finalizing the last step which is ready to be delivered to the consumers.
Amazon Warehouse ship their final goods to the wholesalers and retailers and then It goes to the consumers and customers. For Example, when one orders a pair of shoes from amazon which is officially sell by a distributer, where amazon remains a medium to meets the customer’s demand. The cost of transportations is higher because the product would be first sent to the amazon’s warehouse from distributer and then to the customer.
Overall, Amazon’s journey started from selling books to selling almost everything now, Amazon now covers all the market with a huge grip on its customers who they provide with millions of products with a wide range. Amazon now serves its customers with fast paced trackable deliveries which no other company is close to do.
Amazon can eliminate the role of their warehouses by linking the orders directly with the manufacturers.
Amazon could introduce a delivery system that directly delivers the ordered product from the manufacturer, which saves a lot of cost of bringing the product to their warehouse first for Amazon.
Price Strategy: In the price strategy, it involves the cost of product, tax, shipping and maintenance. Amazon provides discounts, special sales and offers to the customers. According to the research, it is believed that amazon is much expensive as comparison to other retailers, but the price of products on Amazon is cheaper than other distributors.
If someone is already a customer of Amazon and that person is recommended to his/her friend or family member to purchase anything from it, Amazon should give more or any special discount to him/her. It will help to increase their sales more.