Analyzing Amazon's Business Model and Impact of Social Media

This assignment delves into the world of e-commerce giant Amazon, examining its business model and how it has adapted to changing market dynamics. The document also explores the significance of social media in influencing customer behavior and preferences. By analyzing various studies and research papers on the topic, this assignment aims to provide a comprehensive understanding of Amazon's business strategy and its relationship with social media.

BUSINESS
FUTURE

Table of Contents
INTRODUCTION...........................................................................................................................1
QUESTIONS...................................................................................................................................1
Q1 a) Critical evaluation on social media as a core competencies for competitive advantage...1
Q1 b) 2 Key social media platforms...........................................................................................2
Q2 a) Impact of social media on the profit margin of Amazon in last three years.....................4
Q2 b) Future of social media and its implications for business in next five years.....................6
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Social media is a computer mediator tools which supports whole society in making
positive relations with distinct members. However, playing a very eminent role in current
marketplace because it helps in connecting domestic and foreign society with each other as well
as create an effective long distance relationship (Schmidt, and Cohen, 2013) . As a result,
number of corporate companies are getting succeeded in acquiring competitive advantage by
using modern technologies. Amazon is a most leading company engages in offering online
services to their clients for gaining maximum benefits. Therefore, assignment is going to
highlight the need of social media at workplace and its benefits for entire corporation.
Furthermore, throwing some lights on profitability ratio of past three years of an organization as
well as outlining future of social media in coming five years.
QUESTIONS
Q1 a) Critical evaluation on social media as a core competencies for competitive advantage
According to Zott, Amit and Massa, 2011 Marketing is an important process through
which organization achieve their competitive advantages. It is important for every enterprise to
choose best platform so that it can make maximum impact on users. There are wide range of
variety which is available in the market to advertise the product and hence selection should be
made such through which the customer can be attracted. Gibson, 2011 says that social media has
become so much popular in recent time period as it has influenced the customer to a great extent.
He says that these days’ people spend their maximum time on scrolling the social sites and
consider it as a medium of getting knowledge about the market. Fashion keeps on changing and
it is crucial that companies maintain the development in its products as per the demand in
market. there are customers who belong to different age group hence medium f reaching t them
has to be such that it has maximum impact on the choice of clients. In the words of Xi and et. al.,
2015 core competencies are the sources through which particular firm experiences growth in
comparison to other. It has to be developed over a period of time as only than the profit margins
can be raised. He further adds that social media develops value to brand by making it familiar to
market. a company can deliver all the required information associated with the product by
selecting an effective platform which is most famous in the market. Thereafter Daniel, Cano and
Cervera, 2015 also gave his suggestions that how with the help of social promotion tools a
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company a reach to the most effective level. These days as there are number of options with
customers to choose their product from the market it is required that close connection with the
customers is maintained so that whenever there is a doubt in the mind of customer it can be
resolved at same time. Awareness in the market has raised much that it has become impossible to
ensure personal connection with every customers and therefore in this case too with the help of
social platforms like watts’ app, Facebook etc. quarries of clients can be resolved by facilitating
personal interaction among the two parties. After sale services has also become easy with this
idea of marketing through social media as clients are provided with an option of asking their
quarries about the product they have purchased. Gerbaudo, 2018 also says that when clients are
provided with online demos they get more influence with the same specially in case of attracting
that customer for which it is not possible to be physically present at the stores where sales take
place. It is found that a product may get fail to be established in market in case of less efficient
social presence as it is overruled by the big shots who has captured market through
advertisements on public sites. Couldry, 2012 gave a very strong point that factors the use of
networking sites by highlighting the advantages f same that how it has increased the total scope
of the firm. Now entrepreneurs can reach to more areas which were difficult to be accessed
before. This has further improved the profit margins of the organizations as now they have to
invest less on the marketing as it promotion of products is a less expensive mode and gives more
returns to the organization. The saved cost can be further invested in their areas which can
further improve the capacities of firm. Customers can also avail the services of the organization
without stepping out of their homes which has again proved to be a blessing of social media.
Q1 b) 2 Key social media platforms
In the present scenario, Social media is one the best tool or platform which support in
developing the business in the market place. There are various organisations who take support of
social media for the purpose of promoting the company among the competitors or huge
audiences in an appropriate manner. It an essential and best medium where organisation can
transfer information to the wide range of people regarding particulars goods or services in an
effective manner. Social media is helpful components that support in staying connect with
number of people and partner companies etc. now a days, it has become easy to share
photographs, videos, informations and animations and many more from place to another at world
wide without any barriers or issues. Therefore, it can be seen that social media users are
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increasing day by day as everyone is connected with social sites or media as well. Amazon
which is providing online services tos the customers as people are preferring online shopping at
home rather than go outside for purchasing so they also considered social media for promoting
their business. Many of customers are connected with amazon and order online products or
services (Tufekci and Wilson, 2012) .
Twitter is one the fastest and rapid social media platform which provide information in
every minutes regarding any happening or events as well. It is leading the social media so
Amazon prefer to Twitter for passing informations and create market awareness in an
appropriate manner. There are number of followers of the Amazon on the Twitter as
approximately 27.9 million followers as per the recent data. Therefore, company is using this
social media for communicating the necessary information like any scheme, festival offers and
many more to the targeted audiences so that they can be attracted towards organisation.
Interested customers can re-tweet their messages if any query then they can ask to them. So it is
best method for stay connecting with loyal customers and solve their particular problem.
Amazon also attract people by displaying sale and provide some gifts or vouchers to the
customers in well manner.
Facebook is also another best social media that helps in providing more informations
regarding products or services. in the modern era, Facebook has become a powerful social media
as number of people are using this platform for sharing ideas and thoughts as different people are
connected with Facebook. Many of organisations are considering this platform for covering wide
area of or large population as well. Amazon also have number of subscribers in the Facebook as
approx 29.5 million people are following to the amazon on the Facebook. They are focusing on
this social media so that they can interact with huge people in the UK. It is very beneficial aspect
that people can easily approach for purchasing any items at reasonable costs with help of online
shopping on Amazon. They are trying to attracts more customers towards company by offering
various offers such as seasonal shopping, festival offers, sale and many schemes so that sales can
be increased in an appropriate manner (De Vries, Gensler and Leeflang, 2012) . Along with this,
it is also an effective tool for marketing a particular products or services as well as promote the
business. People can share their experiences and give feedbacks regarding the products or
services which ordered and get from Amazon so that they can measure the people behaviour and
resolve their issue or problems as well.
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Therefore, Amazon is focusing on both social media platform for the purpose of
promoting business in an effective manner so that maximum benefits can be get within the firm.
Q2 a) Impact of social media on the profit margin of Amazon in last three years
Social media is influencing entire society with their advanced technique of facilitating
consumers such as; provide accurate information about specific products, statistical data, image,
reviews, quality and so on. It means main motive of media is to connect people whomsoever are
living across the international boundaries in order to gain maximum benefits by fulfilling their
needs in a given duration. Amazon is an American association which is engaged in offering best
online services to their customers for making positive relationship with foreign clients. Initially,
company is engaged in providing online book store and later on they are diversifying their
business by selling video downloads MP3, audio book, games, electronics, foods, toys, furniture
henceforth. Mainly, Amazon is having their isolated retail websites in several nations such as;
US, Ireland, France, Canada and so on. Basically, in 2015 this organization is surpassed Walmart
and become third most valuable public association across the global marketplace. Their main
objective is to grab the opportunity that is available at marketplace in order to maximize their
income level (Kim, 2012) . Therefore, social media is seen as most successful technique that is
used by Amazon for improving their organizational performance at marketplace. However, in
2017 they get succeeded in acquiring overall food market costing around 13.4 billion due to
which positive image of an association is establishing at marketplace. As a result company is
challenging walmart traditional retail stores.
In fact, profit is highly affected by social media services because in today's modern world
most of the consumers are addicted towards advanced technology due to its features and benefits.
Major role which is played by social media is that it supports in facilitating consumers with
numerous of services. Profit margin is a major term which shows the current position of an
organization by comparing actual and projected performance of an organization. In coming time
period profit level of an association is enhancing due to increment in consumer demand.
Amazon is a most successful organization that gives online administrations with the use
of cloud computing. Its a web based shopping site and around 566,000 number of individuals are
working in this association. As indicated by the final quarter result that was distributed on
February 1, says that an expansion of 30 percent has been seen because of which $60.5 billion of
incomes has brought up in the quarter. In this manner, Amazon has figured out how to upgrade
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their gainfulness up to 70 percent. Organization gives every single conceivable support to their
clients in various terms such as food services, grocery products, staple things, hardware and
some more (Lovejoy and Saxton, 2012) .
According to the profit analysis of Amazon of previous three years it has been assessed
that organization development rate was less i.e. - 1.50 percent and between the time of 2014 to
2015 it lessens. Furthermore, it came to - 2.12 percent in September 2014 but after adopting
social media tools such as; conducting commercial activities and advertisements in web-based
social networking is resulted in enhancement of company profit level. Along with this improves
the current performance of an enterprise and its efficiency are also getting maximized because
consumers are getting more addicted towards modern technologies. Additionally, net revenue of
selected firm was raised up to 2.86 percent in June month of 2016 that was an incredible when
contrasted with earlier years. Consequently, in current year the net revenue development which
was identifies was almost 3.19 percent that is seen as most highest as compared with earlier data
or information that are recorded in a specific year.
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(Source:- Annual revenue of Amazon, 2017)
Hence, it can be seen that Amazon get succeed in acquiring benefit in their 11 straight
quarters and online networking has turned into the more prominent contributor in various
business. In fact, their main motive is to influence domestic as well as foreign customers to
experience the items which are offering by organization through online services. It is step by step
expanding their deals and gainfulness in a particular day and age. Separated shape this, they are
giving occasional markdown coupons on famous occasions and occasions. This is helping them
in pulling in an ever increasing number of individuals towards their organization (Laroche,
Habibi and Richard, 2013).
Q2 b) Future of social media and its implications for business in next five years
In this in era, social media provide its own contribution to developing and discovering
new ideas, contents and products as well as different services. In this process Amazon create its
marketing strategy through different social media platform. These activities helps to increase
chain of consumers easily. These kind of activities impacts on organisation's revenue, growth
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Illustration 1: Annual revenue of Amazon

and future success. In next coming years, amazon can easily increase their marketing values and
allocation of resources plans. Through this firm can easily get different kind of ideas as -
 Through this Amazon can easily analyse trends and changes that can affect its business
procedure and marketing policies.
 Social media will helping to developing new technology and different development
procedure to be connected with target customers.
 Social media activities always helps to increase values of business procedure as per
coming years.
 These networking activities provide visual content into social media strategies.
(Source:- Roberts, 2017)
All these activities are very beneficial for customers and organisation by getting
appropriate information of their desired objectives. As per current trends social media can easily
expend their marketing values by engaging with some other networking sites. E-market values of
several firms can increase positioning and market values of social media contents properly. Main
reason behind this is new marketing trends and changes that are impossible for customers and
viewers to ignore easily. Through these search engines they can easily get proper information of
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Illustration 2: Social media ad spend surpasses

such things. Amazon uses these networking sites to provide effective sources to target consumer.
All these activities are very helpful for business firms to expend their business as per online
dealing and activities (Annual revenue of Amazon, 2017) (Roberts, 2017). Within next five years
social networking sites can easily build their own communication channels to connect customers
with direct business organisations.
CONCLUSION
From the above report it has been concluded that most of the multinational organization
are adopting useful strategy of social media for maximizing their company productivity in order
to generate more or more profit. Main objective of this report is to focus on major need of social
media equipments at workplace in order to overcome various organizational issues and barriers.
For example; various useful websites are designed for connecting people like Facebook,
Instagram , twitter and so on. Throughout the study one major thing is determined that company
needs to adopt various modern strategy for enhancing their current performance by satisfying
needs of consumers in a given time frame. Hence, above project is supporting Amazon while
running their business entity across various global marketplace in various manner such as; attract
consumers by facilitating them, increase the profit, establishing positive image at market and so
on.
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REFERENCES
Books and Journals
Schmidt, E. and Cohen, J., 2013. The new digital age: Reshaping the future of people, nations
and business. Hachette UK.
Zott, C., Amit, R. and Massa, L., 2011. The business model: recent developments and future
research. Journal of management. 37(4). pp.1019-1042.
Gibson, R., 2011. Rethinking the future: rethinking business, principles, competition, control &
complexity, leadership, markets and the world. Nicholas Brealey Publishing.
Xi, J. M. and et. al., 2015. Mapping the field of family business research: past trends and future
directions. International Entrepreneurship and Management Journal. 11(1). pp.113-
132.
Daniel, J., Cano, E.V. and Cervera, M.G., 2015. The future of MOOCs: Adaptive learning or
business model?. International Journal of Educational Technology in Higher
Education. 12(1). pp.64-73.
Gerbaudo, P., 2018. Tweets and the streets: Social media and contemporary activism. Pluto
Press.
Couldry, N., 2012. Media, society, world: Social theory and digital media practice. Polity.
Tufekci, Z. and Wilson, C., 2012. Social media and the decision to participate in political protest:
Observations from Tahrir Square. Journal of communication. 62(2), pp.363-379.
De Vries, L., Gensler, S. and Leeflang, P. S., 2012. Popularity of brand posts on brand fan pages:
An investigation of the effects of social media marketing. Journal of interactive
marketing. 26(2), pp.83-91.
Kim, A. J. and Ko, E., 2012. Do social media marketing activities enhance customer equity? An
empirical study of luxury fashion brand. Journal of Business Research. 65(10).
pp.1480-1486.
Lovejoy, K. and Saxton, G. D., 2012. Information, community, and action: How nonprofit
organizations use social media. Journal of Computer-Mediated Communication. 17(3).
pp.337-353.
Laroche, M., Habibi, M. R. and Richard, M. O., 2013. To be or not to be in social media: How
brand loyalty is affected by social media?. International Journal of Information
Management. 33(1). pp.76-82.
Online
Annual revenue of Amazon, 2017. [Online]. Available
through<https://www.statista.com/statistics/233725/development-of-amazon-web-
services-revenue/>.
Roberts, 2017. [Online]. Available through<https://oursocialtimes.com/7-social-media-statistics-
for-2017/>.
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