Strategic Analysis of Amazon: Opportunities, Threats, and Strategy Evaluation

This report provides a strategic analysis of Amazon, focusing on its opportunities, threats, strengths, and weaknesses. It examines the external and internal factors affecting Amazon's business strategy and evaluates the effectiveness of its current strategies. The report also suggests potential improvements to enhance Amazon's competitive position in the market.

Applied Corporate Strategy
Assessment: Strategic Analysis
Report

TABLE OF CONTENT
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................4
1. External Analysis.....................................................................................................................4
Five forces...................................................................................................................................5
2. Internal analysis.......................................................................................................................6

3. Strategy evaluation..................................................................................................................9
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14
INTRODUCTION
Amazon is one on biggest E-commerce business in world and operating in almost every
corner of world. It is an American multinational company which is now working on E-

commerce, cloud computing, Artificialintelligent and digital streaming. The owner of Amazon is
Jeff Bezos and founded in 1194. The ecommerce online store is selling almost every products
segments from brandedto local. It the most usable brand in world and consumers are ordering
almost everything from the Amazon Online store. In this report Amazon external and internal
analyses will be analyzed at international market where they are facing threats and having high
opportunities in market. Their strength and weakness to remain in market and compete others.
Also, strategy evaluation and TOWS is created and power/interest matrix of two stakeholder that
help them to accept most appropriate strategy.
MAIN BODY
1. External Analysis
Online retails store are very useful for some of people who are unable to get into
groceries stores and purchase each products. It’s hard for job people and other people to go on
physical stores and purchase. Therefore, online retails stores are more successful from physical
stores nowadays where retail store are providing with online ordering and purchases through
website or mobile application. The online industry is growing very rapidly in all over the world
due to its high feature availably and access to people from any corner. They are having many
opportunities and threats in market where they convert issues into opportunities.
Opportunities Threat
 The future of stores are online only
where major of customers are ordering
through online website and
applications. It is easy to access for
consumers to purchase products and
can attract more of customers towards
company.
 Sales revenue and turnover of
company can be increase with high
percentage through online stores that
help retail industry to grow very fast
as consumers are shifting towards
 Increasing competition in market is
one of the biggest threat as there are
high number of companies operating
in same industry. High competition in
market so companies need to be more
price effective to attract customers
toward company.
 Recession in country is another threat
that can faced by companies as
economy is not stable in current
situation and after Covid-19 almost all

online rather than offline stores.
 High cost of storages are saved by
companies which are used in physical
store and occur major expense as rent
and utility bills that are affect the
profit margins of company.
 Technology equipment help company
to increase the company working
efficiency and have one of the biggest
opportunities to use technology in
company and increase the efficiency
performance. It help to know the
insight of consumer’sbehavior and
expectation from company can be
analyzed and understand by company
and convert opportunity into profits.
 Market of retail store arechangeable
and affect the companies very quickly
but this can be prevent through
analyzing market through using digital
tools and analyze market.
economy had fallen.
 Price wars with competitor that may
sometime create situation that may
face losses or low margins in market.
 The technology used by companies are
very dynamic and need to be change
with time to time.
 New market are hard to enter by
companies as there are already many
competitor that face barrier to
entrance.
This are some of the opportunities and threats that are facing by retail industry. The
opportunities are converted into profits by companies. But retail industry can also convert threats
into opportunities by analyzing threat at initial stage and work effectively on threats before
affecting on company’s operation.Like entrance in new market can be easy if company is
providing unique products or service in market that can easily attract market.
Five forces
 Competitive rivalry: The retail industry is having their own strength to attract customers
towards company.The quality of products and prices that are changes are most important

factor that can compete in market and gain high customers base. There are many
companies which are working on online retail stores operating at large scale in market.
They are also having same quality and prices providing to customers. This are high
attractiveness due to price which can attract customers towards company.
 Supplier Power: this factor are moderate attractiveness as, suppliers are unable to charge
high prices and can be change only minimum increased price according to market. As
these factor will not much affect as online retails stores purchases in bulk from suppliers
and major of sales are gained from retail stores only.
 Buyer power: here high attractiveness assess in industry as prices are one of the most
crucial factor that can affect the company.Buyer are switching over one company to
another I high prices are charged. Major of online buyers are first compare all prices from
major companies website and then make Purchase Company which is providing with
same quality but with different price and low prices company will be preferred.
Customers is having major of power in retail sector to purchase while company can
increase the power only through creative or innovative products they are offered on their
own price.
 Threat of substitute: The threat of substitute have the Likelihoodattractiveness assess in
market as there are already many industries that are offering same. It’s hard to find the
substitute of products that are available in market. The online services channel can be
created by other companies to provide with better services to customers.A substitute that
is easy and cheap to customers is very hard to find in retail industry as most of varieties
are found in retails stores.
 Threat of New Entry:High attractiveness asses in retail industry where threat of new
entry is remain in market as major of companies are looking for expansion and
investment in new market. This affect the existing firms operating in
market.Existingcompanies are already working on to gain major of shares in market and
to attract customers many new offers and strategieslike membership cards are created to
gain loyal customers. As, it is high growing industry in all over the world and companies
which are not dealing in retail sector are also step in into online E-commerce retails
industry.

2. Internal analysis
VRIO analysis
The VRIO analysis can be understood as one of the most optimum productive strategic
model for strengthening corporate structural diversity, wider scale functional efficiency towards
competitive industry domains. VRIO analysis of Amazon will enable to identify new resources
and distinctive competencies where strengths, capabilities for bringing diverse scope among
wide domains can be analyzed. Amazon e-commerce services has been functionally expanding
towards varied scale new synergies, with best technology resources and functional growth
factors the company has been widely heading on commercial growth. The company unique
resources are based on global parameters innovative scaled production technologies, faster
competitive marketing competencies and global standards expansion among new horizons (Qin,
Liu and Tian, 2021).
 Value: Amazon has four resources of core capabilities that form long term core
competitive advantages within industry scenarios, where high brand value and equity in
global market has been analyzed to be widely active. The company attracts current and
emerging new products in market under brand, where it has been also productively
expanding among sustainable competitive resources. The company maximizes benefits
of this core competency by organizing business structural innovation, as per dynamic
evolving competitive market factors, which enhances overall growth domains. Amazon
maximizes best scale competitive innovation among ecommerce industry parameters, for
excelling in varied range of products and services. For strengthened corporate goodwill.
E-commerce industry is vividly expanding where Amazon Unique expertise and
technology reputation, wide range of brand reputation, customer service quality standards
has enhances brand loyalty among customers rapidly. Amazon has further scope to bring
valuable innovation in business model, by bringing new creative growth in productive
expansion among diverse standards.
 Rarity: The rarity factor holds immense importance where varied scale resource planning
and competitive parity structural planning has been competently evolving, where
fundamental progression enhances competitive advantage. Valuable and rare resources
have potential strong impact for overall strength expansion, where Amazon brand has

high market capitalization within brand equity growth which successfully grows stronger
vivid development (Radhakrishnan, 2021). Proficiency evolved in E commerce is also
rarity factor within wide competitive industry, where customers trust and loyalty for
Amazon has been fruitfully growing. The brand has been leveraging wide scale
innovation towards best e commerce services, new range of creative expansion and
fruitful connective targets for productive leveraged expansion. Quality standards within
sustainable business operations, with continuous innovation in ecommerce industry have
been heading towards wide scale growth expertise. Amazon competencies need to further
modify with new innovation, where recent consumer demands are widely expanding
towards varied larger levels.
 Imitable: Tangible resources such as premises can be imitated, but best scale technology
used in resources, expertise and commercial potential marketing strategies cannot be
imitated for strengthened corporate structure. Amazon brand reputation is combination of
best leadership skills within varied teams, ideologies used for commercial expansion and
also towards wide range of corporate functional goodwill (Amazon Marketing Strategy
2020- The ultimate overview, 2020). This also further explains corporate functional
expansion and new range of creative innovation, where Amazon resources have
developed strong brand image in global e commerce market. The brand expertise is
highly impossible to imitate and moreover expensive to channelize huge scale global
expansion, where the networks are hugely expanded among corporate scenarios.
Resources used by Amazon are not easy for other competitors to imitate, where it can be
analyzed that they are unique and also further scale diversity factors are huge which
enhances productive goodwill (Knape, 2021.Amazon weakness is also based on aspects
where company needs to also focus on opening new physical stores, for easy availability
among customers which will bring enhance stronger viable supply. Further it can be also
analyzed that it has imitable business model, limited penetration in developing markets
and limited brick and mortar presence which are some of the major weaknesses.
 Organized: Being organized means development and achieving best competitive
advantage, where framework analysis helps to explain Amazon products and services
such as Amazon Go, Amazon Books and various other being served with best functional
growth expertise and proposition as per brand value for bringing on dynamic overall

productive rise. Further it also explains new rise on stronger organized aspects, used by
company which has enabled brand to reach diverse scope effectively within global
parameters. Amazon has been sustaining best customer loyalty tools for imperative
functional growth, wider digital platforms connectivity within new targets. This also
further explains by being organized company promises best functional scale growth
determinants, for yielding towards larger revenue goals and wider goodwill. Amazon has
been also informatively growing with vision oriented leadership, directive working
parameters of dynamic competencies which bring on wide rise on stronger arenas.
Employees need to be given more trainings, bring wider scale technology rise and further
invests new resources strategically towards bringing best competitive diversity.
The above analysis done by VRIO analysis has analyzed in detail that strengths of brand
name, high valuable reputation within industry networks has been excelling towards enhanced
customers services. Loyalty factors and strong diversified distribution networks have been
growing towards technical expertise, where Amazon products are hard to imitate, rarity factor is
also there and also well organized. E commerce industry has been vividly expanding towards
untapped new horizons, for strengthened functional goodwill and also to evolve on varied scale
targets. Amazon resources and technical expertise factors used are unique, based on new
dynamic corporate standards with wide potentialities which has enabled huge brand growth
scope (Baker-Brunnbauer,2019)
3. Strategy evaluation
TWOS analyze is used to analyses the strength, opportunities, threat and weakness of Amazon
company to prepare a better strategies to attract more customerstowards company and gain
competitive market where they are operating.Through TWOS, Amazon can enhance their
strength and prevent weakness through converting them into opportunities (Three Amazon
Marketing Strategies For 2020, 2020).
Strength:
 Amazon is having
high brand value that
help to gain customers
trust easily.
Weakness:
 Limited Bricks and
Mortar presence.
 Imitable business
model by Amazon.

 High quality standards
and high competitive
equity in retail
industry.
 High capital structure
by Amazon.
 Large numbers of
Patents.
 Limited penetration is
developing market.
 Need to put more
training among
employees.
Opportunities:
 Online stores are
future of retail
industries.
 Increase in sales
revenue and turnover
of online stores.
 High cost are saved
by Amazon majorly
on rent and utilities
bills.
 Technology is new
world for industries.
 Providing consumers
wants goods through
analyzing market
research,
SO
 Brand value makes
strong online store
offering all types of
products.
 Quality products are
offered at lower price
by Amazon.
 Large profits margins
by company due to
less cost occurred on
online stores rather
physical store.
 High volume of
customers due to
brand values and
patents that are having
by company.
WO
 Physical store are not
present in market that
makes some
peopledifficult to
order on online.
 The sales are offered
to few customers to
gain the customers
once.
 Rural areas are not
develop and used by
company and urban
markets are only
targeted by company.
 High cost on training
and development of
employee to improve
market strategies ,
Threats:
 Increasing in
competition in retail
industry.
ST
 High competition in
market make amazon
stronger to work on
WT
 Imitable models of
amazon can affect the
customers and rising

 Recession in company
may affect operation
of Amazon.
 Price war
betweencompetitions.
 Rapid change in
technology.
 Barrier to entrance in
new market.
market and new offers
as they are having
large amount of fund
available to them.
 High quality products
are always preferred
by middle and high
income level without
any price
consideration.
 High capital of
company help in
adapting new
technology which are
changing rapidly.
 Large number of
patent also makes
other competitor to
offer same line of
products or services.
competition can
impact on market
share.
 Competitors are
working on rural areas
by providing online
deliveries in areas.
Amazon may lose
some of markets.
 Rapid change I
technology need high
training and
development of
employee is necessary
that include high cost
and time.
Interest matrix
Amazon has varied range of stakeholders, where employees, external shareholders,
suppliers and government are of major top priorities where employees and shareholders within
external businesses have high impact on gaining overall productivity. Employees plays strong
role for bringing new range of productive efficacy standards for stringent growth rise, overall
leveraged strength towards untapped scenarios. Strategies such as keeping satisfied and
managing close interaction, brings on informative growth towards productive expansion rapidly
towards untapped new informative goals for higher loyalty. External shareholders are another
stakeholder which needs to be keep informed, specifically bring on competent efficacy
benchmarks rapidly, and also evolve on constant targets profoundly. Both employees and
government should be evolved towards bringing dynamic rise profoundly, for synchronizing new

range of creative strength and overall technical standards. Feasibility comment on usage if
financial resources, skills required for training implementation enhances strengths towards new
performance domains. Amazon as one of the best global e-commerce company has been heading
on flexibility strength, usage of best finance resources and skills for bringing best customers
services innovatively (Bucklin, 2018).
Company productive technologies and usage of capital will enable best potential
expertise for strengthening corporate goodwill rapidly, enhance outputs functionally and also
bring forward long term revenue rise. The feasibility factor excels towards representing best
fundamental targets, for stringent productive overall growth which brings brand value rise and
also gain new range expertise. Amazon strategy to expand trainings for employees, will enhance
new vivid functional productivity standards and also primitively bring on new resourceful
growth within new productive domains. It can be analyzed that shareholders are external
stakeholders, here brand value and structural goodwill is widely crucial for gaining high growth
benchmarks towards potential ends for attaining wide profits. This further brings on wide
potentialities for strengthening corporate expansion rise, overall productive functional growth
which also brings determinants towards gaining specific competent rise (Amazon Business
Strategy: Insights of its operation and investment plan to become the top Fortune 500 company,
2020).
Amazon as leader of global e commerce company aims to keep stakeholders widely
evolved, technically trained and also innovatively expanded towards rapid new scale expertise.
This further heads on wider gaining stronger determinants scope for gaining new rise up scope
among wider business international standards towards strengthening vivid innovation. This
further calls up for keeping up competent scope among engaging stakeholders with rapid
connectivity benchmarks, larger scale growth rapidly where it brings revenue rise. The
stakeholder matrix has also functionally enabled to identify competent scope, towards attaining
scope for stronger rise on new capital structure parameters. Furthermore, it is cost effective and
widely feasible for gaining stronger effective potential benchmarks among bringing rapid
connectivity towards dynamic business standards actively.
This also explains new quest aspects where Amazon as widely expanded global
company in e-commerce industry has been vividly growing towards dynamic competent surging

pace for strengthened corporate expansion. Stakeholders strategy are correlated with
investments, as per new range of innovation towards long term targets towards pertaining
competitive aspects (Kumar and Kim, 2018).
CONCLUSION
From the report it can be concluded that varied aspects within strategic analysis done on
e-commerce industry shows that Amazon is one of the biggest company heading with best
products and services globally for large range of customers globally. External analysis has
concluded varied opportunities and threats, with detailed analysis done on porter 5 force
framework. Furthermore, VRIO analysis concluded Amazon resources have high value, rarity
factor and less potentiality to be imitable and are widely organized which has enabled huge
brand market presence in industry. The study further concluded TWOS analysis, strategies
evaluation where company resources are competitively evolving towards dynamic standards,
with best innovative supply chain factors. Stakeholders’ involvement also concludes Amazon
strategies are widely competitive, for productive technical goodwill and best quality benchmarks
which opens up varied scope.

REFERENCES
Books and Journals
Baker-Brunnbauer, J., 2019 Amazon Go Store Implications for the Traditional Retail Market.
Berg, N. and Knights, M., 2019. Amazon: how the world’s most relentless retailer will continue
to revolutionize commerce. Kogan Page Publishers.
Bucklin, L. P.,2018 Retail strategy and the classification of consumer goods. Journal of
Marketing, 27(1), pp.50-55.
Ene, S. and Özkaya, B., 2014. A study on corporate image, customer satisfaction and brand
loyalty in the context of retail stores. Asian Social Science, 10(14), p.52.
Grewal, D., and et.al.,2003. The effects of wait expectations and store atmosphere evaluations on
patronage intentions in service-intensive retail stores. Journal of retailing, 79(4),
pp.259-268.
Hosseini, Z., Jayashree, S. and Malarvizhi, C., 2014. Store image and its effect on customer
perception of retail stores. Asian Social Science, 10(21), p.223.
Ives, B., Cossick, K. and Adams, D., 2019. Amazon Go: Disrupting retail?. Journal of
Information Technology Teaching Cases, 9(1), pp.2-12.
Knape, D.A., 2021. Cooperation Strategies for the Amazon Marketplace (Doctoral dissertation,
Universität St. Gallen).
Kumar, A. and Kim, Y.K., 2018The store-as-a-brand strategy: The effect of store environment
on customer responses. Journal of Retailing and Consumer services, 21(5),
pp.685-695.
Polacco, A. and Backes, K., 2018. The amazon go concept: Implications, applications, and
sustainability. Journal of Business and Management, 24(1), pp.79-92.
Qin, X., Liu, Z. and Tian, L., 2021. The optimal combination between selling mode and logistics
service strategy in an e-commerce market. European Journal of Operational
Research. 289(2). pp.639-651..
Radhakrishnan, V., 2021. E-Commerce industry and its effect on the world today. International
Research Journal on Advanced Science Hub. 3(2), pp.23-29.
Stone, B., 2013. The everything store: Jeff Bezos and the age of Amazon. Random House.
Zimmer, M.R. and Golden, L.L., 1988. Impressions of retail stores: A content analysis of
consume. Journal of retailing, 64(3), p.265.
Onlineazon Marketing Str020 – The Ultimate Overview

Amazon Business Strategy: Insights of its operation and investment plan to become the top
Fortune 500 company. 2020. [Online]. Available Through :<
https://www.greyb.com/amazon-business-strategy/>
Amazon Marketing Strategy 2020- The ultimate overview. 2020. [Online]. Available Through :<
https://sellics.com/blog-on-amazon-advertising-marketing-overview/>
Three Amazon Marketing Strategies For 2020. 2020. [Online]. Available Through :<
https://www.forbes.com/sites/davidaxe/2021/04/26/just-how-safe-is-taiwan-
from-china-american-experts-arent-sure/?sh=2ba0885841ef>