Amazon's Business Strategy and E-commerce

This assignment examines Amazon's e-commerce business strategy. It delves into the company's approach to acquiring new customers and retaining existing ones, highlighting their strategies for attracting both groups through targeted marketing campaigns and discounts. The analysis also explores how Amazon leverages knowledge management tools to enhance its business operations and competitive advantage in the online marketplace.

Running head: BUSINESS SET UP
Amazon’s marketing strategy
Name of the Student:
Name of the University:
Author note:

1BUSINESS SET UP
Part A: Organizational structure of Amazon
The organizational structure of Amazon has to be classified in a hierarchical way. It
has the team of Senior Management which would include two Chief Executive Officers; there
are three senior vice presidents and one controller who would be responsible for the other
vital aspects of the business which would report straightaway to the Chief Executive Officer
(Amazon.in, 2017; Bidwell, 2012) There would be seven segments such as information
technology, legal operations and human resources who would report to the CEO of Amazon.
Amazon would remain flexible to its adaption to the frequent changes to the external
environment. Amazon this online retail store is also looking forward to make greater
innovation in the field of e commerce and in future also it is also looking for an innovation in
the industry of global logistics. (Kantor & Streitfeld, 2015).
(Plan for the organizational structure of Amazon) (Kantor & Streitfeld, 2015)

2BUSINESS SET UP
External environment of Amazon
PESTLE analysis
Political factors: PESTLE analysis in terms of political factors focuses on the political stabled
base of the other developing countries, Government’s aid to the e-commerce and the
initiation of efforts for the development of the e-commerce. Amazon would benefit from the
political stability. This condition further enhances the expansion of the company to make its
business diverse (Ignat & Maha, 2012). However, on the other hand, the entire government
support for facilitating the e-commerce is also an opportunity which is looking forward to
diversify its market segments with a greater amount of support from the government. The
support of the government is needed in order to expand the company and bring improvements
in the regulations of law which would allow the business to flourish more (Ignat & Maha,
2012; Koumparoulis, 2013).
Economic factors: The situation of Amazon depends upon the situation of the economies
which concerns about its retail business carried out in online mode. The effects of the
economy trends and its further changes on the macro environment’s report are taken into
consideration of this analysis. These are the following external factors which are considered
to be important in this particular company (Ignat & Maha, 2012; Koumparoulis, 2013). First,
the economic stability is needed to be taken into account of most of the developed countries’
markets. Second, to take into consideration, the economic recession of Europe this is
considered to be a threat.
It is the economic stability which would increase the success for the Amazon Company in
these markets. Amazon might face boost in its growth in the other developing countries. The
Chinese market is considered to be one of the biggest growing markets and in future it is
hoped that would increase its growth in future (Ignat & Maha, 2012; Koumparoulis, 2013).

3BUSINESS SET UP
Social Factors: Social factors would determine the performance of Amazon as the leading
retailer online. Therefore, this model can better identify the changes in the socio cultural
trends on the firm’s macro environment (Ignat & Maha, 2012).The increasing disparity in
wealth and the increasing of gap between the richer and poorer countries, threats the
conditions of the business in context of stagnation in the levels of income or the macro
environment of retail business carried out in online. Nevertheless, the increasing of the rates
of consumerism in the markets of the developing countries enhance the growth of Amazon
and Amazon as a result can look forward to expand its market in these kinds of locations
which would result in the online buying attitude as more people in the world have access in
the internet (Ignat & Maha, 2012; Koumparoulis, 2013).
Technological factors:
The advancement in technology leaves an impact on the company Amazon which would take
into consideration the centrality of the technology in its online business (Ignat & Maha,
2012). The PESTLE analysis in terms of external factors would take into consideration the
increasing efficiency in the field of IT and enhancement of the cybercrime. If Amazon keeps
on continuing to invest in the technology of information, it can save its business from the new
competitors in the industry of e commerce (Ignat & Maha, 2012; Koumparoulis, 2013).
Environmental factors:
Amazon is mainly an online business store, its operation are subjected to the natural
environment’s conditions. The external factors of Amazon focus on the rising interest in the
environmental programs and also focusing on the lifestyles of low carbon popularity (Ignat &
Maha, 2012).
Legal Factors

4BUSINESS SET UP
The following legal factors are important in terms of enhancing the regulation of product,
easing the regulations of both import and export and increasing the regulations of the
protection of the environment (Ignat & Maha, 2012; Koumparoulis, 2013). For example in
future Amazon can increase its operation through the Corporate Social Responsibilities to get
in touch with the suppliers based on overseas.
Internal Environment
SWOT analysis
Strengths: Amazon being an online retail store, it can achieve its strength from
leveraging the Information Technology and also looks forward to make its e commerce swift
to put its company in the first line (Pandya, 2012). Amazon uses efficient distribution systems
and the logistics to fulfill the customer’s need which in turn giving the company to gain its
competitive advantages (Pandya, 2012;).
Weaknesses: Amazon must limit its offers on free shipping as the company can lost
its margins and would fail to make its cost optimize. Amazon is an online retailer as its aim is
to expand plans in the markets of emerging economy can come as challenges (Pandya, 2012).
Opportunities: Amazon might bring improvements of the company’s margin by
introducing its online based payment system by utilizing its own gateway of payment
(Pandya, 2012; Belanger, Van & Crossler, 2012). Amazon can utilize the opportunity to sell
products under its own brand instead of selling products made by its partners.
Threats: The online shopping is posed to be one of the biggest threats which might get
exposed to hacking and also leaving the data of consumer exposed (Pandya, 2012).

5BUSINESS SET UP
Risks for Amazon
The risks involved are that Amazon might face a tough competition from the other
retailers who might acts as threats if Amazon follows a behemoth strategy. The Business
needs to focus on the marketing conditions in the context of pursuing the global strategy.
Another risk that is involved in terms of the success of the company is that the online
shopping is subjected to more risks and threats because the company leaves it’s the data of
the customers exposed. Thus, Amazon needs to move to the site of allay consumers which
would give security to the online privacy. The Amazon needs to take care of the pricing
strategies; the greater amount of focus on the strategy of leadership based on cost might bring
troubles to the company as it might enrage the other competitors to make them think that
Amazon might get hold over their business.
Business practices to encourage better performances
Good Team: To achieve a better business performances, the need of a good team are
needed who can take care of the selling financing collecting debts and many more. If the
team members are paid for their work, they would be satisfied (Mckenzie & Woodruff, 2016;
Vrontis & Thrassou, 2013).
Assessing product: Products are needed to be assessed properly in terms of quality
and design (Mckenzie & Woodruff, 2016; Vrontis & Thrassou, 2013).
Gathering knowledge about competitors: It is important to know the market position
and come up with strategies to make a systematic route to the market (Mckenzie & Woodruff,
2016; Vrontis & Thrassou, 2013). If one has a comprehensive knowledge about their
competitors, the strategies can be made accordingly.

6BUSINESS SET UP
Paperwork and trade: The goods must be carefully packaged, branded and send them
to the customers and the terms of trade are needed to be clear regarding carriages, packages
and the reservation (Mckenzie & Woodruff, 2016; Vrontis & Thrassou, 2013)
Planning: Planning is important to frame out project work on a regular basis and this
should be made on the information available to them (Mckenzie & Woodruff, 2016).
Works of Amazon
In the website of Amazon one can find clothing, jewelry, computers and other
accessories which can be bought. Amazon also focuses on the attempts in order to customize
the experiences of the buyers. There are some techniques that Amazon follows and that are
tracking the customers (Varia & Matthew, 2012). Customer tracking is a very effective way
to attract the customers. There are also other features such as multi leveled e-commerce.
Amazon is one of the best sites to sell the merchandises on the web and due to its flourishing
experiences; it has also come up with moiré innovative strategies in its business (Varia &
Matthew, 2012).
Part B: Knowledge Management and E commerce
The companies which are e commerce are being supported by the management of the
knowledge based system for the growth, acquisition of customers and retaining them in order
to manage the costs which are variable in nature (Holsapple, 2013). On having the tools of
better knowledge management, the companies based on online business, can enhance their
business strategy such as Amazon, it is a platform for the new products. The company is also
involved to make their customers engaged in order to validate their products only it is
incorporated in the catalogs of online (Holsapple, 2013).

7BUSINESS SET UP
The controlling of the acquisition of the customers is also one of the top concerns for
the companies which are e-commerce. Amazon being one of such companies also satisfied on
seeing the returning of the customers to their sites and the business also witnessed many new
customers more than 40% (Holsapple, 2013; Galliers & Leidner, 2014 ). The company is also
focusing to avoid squandering higher discounts on the demands of the customers who are also
looking forward to but again. Instead the bigger offer can be used to lure the new customers
who want larger discounts. In this case, Amazon must start working with the Retention
Science in order to restructure the marketing campaign of the email. The Retention Science
managed the discounts from 0 to 6% (Holsapple, 2013).

8BUSINESS SET UP
References
Amazon.in. (2017). Online Shopping: Shop Online for Mobiles, Books, Watches, Shoes and
More - Amazon.in. Amazon.in. Retrieved 11 August 2017, from
http://www.amazon.in/
Belanger, F., Van Slyke, C., & Crossler, R. E. (2012). Information systems for business: an
experiential approach. John Wiley & Sons.
Bidwell, M. J. (2012). Politics and firm boundaries: How organizational structure, group
interests, and resources affect outsourcing. Organization Science, 23(6), 1622-1642.
Galliers, R. D., & Leidner, D. E. (Eds.). (2014). Strategic information management:
challenges and strategies in managing information systems. Routledge.
Holsapple, C. (Ed.). (2013). Handbook on knowledge management 1: Knowledge
matters (Vol. 1). Springer Science & Business Media.
Ignat, I., & Maha, L. G. (2012). E-Commerce across United States of America: Amazon.
com. Economy Transdisciplinarity Cognition, 15(1), 252.
Kantor, J., & Streitfeld, D. (2015). Inside Amazon: Wrestling big ideas in a bruising
workplace. New York Times, 15, 74-80.
Koumparoulis, D. N. (2013). PEST Analysis: The case of E-shop. International Journal of
Economy, Management and Social Sciences, 2(2), 31-36.
McKenzie, D., & Woodruff, C. (2016). Business practices in small firms in developing
countries. Management Science.
Pandya, M. (2012). Cloud computing for libraries: A SWOT analysis.
Varia, J., & Mathew, S. (2014). Overview of amazon web services. Amazon Web Services.

9BUSINESS SET UP
Vrontis, D., & Thrassou, A. (Eds.). (2013). Innovative Business Practices: Prevailing a
Turbulent Era. Cambridge Scholars Publishing.