Marketing Strategies of Amazon Australia: An Overview

This report gives an overview of the marketing strategies adopted by Amazon Australia and also illustrates the strategies that it can take for further market expansion.

Running head: MARKETING
Marketing
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Executive summary
Amazon is the biggest online retail giant of the world. Since its establishment in 1994 as an
online book selling company, Amazon has grown significantly and has become a multinational
company. It launched its business in Australia in November 2013 and since then it has been able
to capture a significant market share. This report gives an overview of the marketing strategies
adopted by Amazon Australia and also illustrates the strategies that it can take for further market
expansion.

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Table of Contents
1.0 Introduction................................................................................................................................3
2.0 Background to the company......................................................................................................3
3.0 Marketing analysis.....................................................................................................................4
3.1 Nature of Amazon Australia’s Marketing Strategy or Strategies since it began...................4
3.2 Strategic Marketing Options for Amazon Australia moving forward...................................6
4.0 Conclusion.................................................................................................................................8
References......................................................................................................................................10

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1.0 Introduction
Amazon is an online retail giant, headquartered in Seattle, USA. The company has
become the market leader in online retail in terms of revenue and capitalization. It started out in
1994 by selling books online. Since then, the company has expanded massively not only within
the USA, but also in the international market. It has diversified its business into multiple
segments, such as, electronics, video games, audio streaming and downloads, video streaming
and downloads, software, apparel, accessories, home and kitchen appliances, gardening, toys and
food items (amazon.com.au 2018). Apart from these, Amazon also has its own product line, such
as, fire tablets, kindle and various low end products under the brand name of Amazon Basics.
Amazon has been operating in Australia for a long time and in 2017, it experienced a massive
expansion (Neate 2018). This report gives an overview of Amazon Australia and its marketing
strategies. It also undertakes a market analysis of Amazon Australia and focuses on the
marketing strategies adopted by the company since its inception. The report also presents an
insight on the ways that the depicted strategies would be successful in the years to come.
2.0 Background to the company
Amazon was founded by Jeff Bezos in 1994 as an online book selling company. Within
two decades, the company has become an e-commerce giant. According to a report in Fortune by
Carr (2018), Amazon is the third most valuable country in the world, preceded by only Apple
and Alphabet. Like in many other countries, Amazon launched its business in Australia in
November 2013 with all types of products it sells at the most reasonable prices. The retail giant
has seen immense growth within the past few years due to the widespread usage of smartphone
technology and mobile internet, which has made shopping extremely easier and convenient. The

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huge range of product choice at a reasonable price and speedy delivery are the business secrets of
Amazon. The mission of the company includes the features of lowest prices, best selection of
products, and utmost convenience to the customers and the vision of the company is based on the
aim of achieving a global reach by using customer centric approach with widest selection of
products (Gregory 2018). Thus, focus on customers, interest for inventions and operational
excellence is the main objective of Amazon.
3.0 Marketing analysis
3.1 Nature of Amazon Australia’s Marketing Strategy or Strategies since it began
As stated by Baker (2014), effective marketing strategy represents the combination of the
4Ps of marketing mix. Marketing strategies are made to meet the marketing objectives of the
company and to provide value to the customers. The 4Ps of marketing mix includes four most
important features, that is, product, price, promotion and place. These factors are combined
together to create a position of the product in the target market.
 Product refers to the tangible good or intangible service, meant to meet the demand or
need of the customers.
 Price is the amount that includes production cost and includes discounts, allowance,
credits terms and list price.
 Promotion includes advertising activities, sales promotion, and public and personal
selling.
 Place refers to the distribution process, that is, the place of shelving to create a
relationship with the customers (Ang and Rusli 2018).

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The nature of the marketing strategies of Amazon Australia in terms of the 4Ps of marketing mix
is illustrated below.
Product: Amazon is an e-commerce retail giant with a global presence. The company
has created an online product market with a diverse range of products, which can be browsed and
purchased from the website and mobile app. Then the products get delivered to the customers’
homes directly. It sells products of various local and international manufacturers and along with
that Amazon also has its own product lines, such as, Kindle, Fire TV, Fire Tablets, Amazon
Drive and Cloud Services, Amazon Wireless, Echo, Amazon Prime, and many more. Under the
brand name Amazon Basics, it also offers very low priced but good quality products. Under the
retail umbrella, Amazon has all possible products, such as, electronic gadgets, books, accessories
and clothing for men, women and kids, home appliances, hardware, software, gardening, toys
and baby products, video games, video and audio streaming and downloading. The nature of
products is similar in Australia and in other locations.
Price: According to Reimers and Waldfogel (2017), Amazon works on competitive
pricing. This is the most crucial strategy of the company to stay ahead in the market. For
example, Amazon puts up the product list of new ones as well as the used ones for products like
books, electronics, kitchen appliances, furniture etc. with lower price. For faster delivery, it has
launched prime services in which people can buy a membership for a minimum price and enjoy
free delivery and many other services for free for a year. Since, it does not need to display
products in stores, the operating costs are less, which makes competitive pricing possible. It also
conducts sales in many times of the year, especially before the celebration seasons, like,
christmas, new year etc. The discount price is much lower than the competitive prices, which
helps it to earn massive revenue.

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Place: As highlighted by Jackson and Ahuja (2016), Amazon has a global presence in the
e-commerce industry, with a big brand name for delivering high quality products at a
competitive price. However, Amazon did not invest in opening stores and increasing operation
costs. Rather, it places the product pictures in the website and mobile app catalogues with every
possible details. It also encourages the customers to leave reviews about their purchase to
increase the authenticity and credibility of the products. These techniques have been beneficial
for the company as well as customers who are more comfortable in online shopping.
Promotion: Amazon has invested in promotional activities in the television and radio
channels and print and digital media. In the recent past, the company has been putting up
advertisements in the billboards and hoardings for easy spotting. It also gives frequent discount
offers which also helps in promotion of the products as well as the brand Amazon itself. Apart
from that, it goes for search engine optimization so that the name of the company stays at the top
of the search results. Moreover, Amazon applies website advertising techniques for push
promotions (Loo and Leung 2018).
3.2 Strategic Marketing Options for Amazon Australia moving forward
To achieve success in their business through the next decade in the Australian market, Amazon
can adopt the following strategic marketing moves.
Include more local businesses: To increase its market share, Amazon should include
more local sellers in their supplier list. As more and more local businesses are sustained with a
back up from the e-commerce giant, the more will be the acceptance of it among the customers.
Different unknown sellers and ambivalent relationship with the customers often creates a major
threat to Amazon (Ireckon.com 2017). The company should also include programs for the local

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community and businesses under CSR activities to increase about brand awareness and its
popularity.
No frills shopping: Amazon should launch no-frills shopping experience for the
customers. It should introduce two-day free shipping frequently and multiple times in the year
for all the Australian customers, as it did in July 2018 (Masters 2018). This initiative has
increased Amazon’s sales significantly during this time. Otherwise, it can also wave off the
minimum price criteria for free shipping for all the customers. That would help it to increase the
customer base.
Include more luxury brands: Amazon stocks and sells many local and smaller brands at
a reasonable price. However, they should also target the luxury goods market in the future. It
should start selling the high profile brands of different product categories at the outlet prices,
which would not only increase the customer base for the high street brands, but also would
increase the popularity of Amazon among the luxury goods customers.
More innovation: As seen from the profile of Amazon, it is a persistent innovator. It
keeps on investing in the technologies for innovation and brings out new products and services
for improving the customer experience. Currently, it has launched robotic warehouse and drone
delivery. The level of innovation done by Amazon possesses major threat for the local
businesses.
Adapting content marketing: Amazon can adopt the content marketing technique
through blog posts, videos, infographics, photos, and other forms that can attract the customers.
For example, if it offers sales on handbags, then it can make videos on those bags with nice
catchline, or it can publish blog articles highlighting the features of the bags and also the offers

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of Amazon. These articles will contain the link to the Amazon website page with that product, so
that customers can check the price of the bag immediately. Hence, content strategy is quite
impactful. However, for that, Amazon must conduct a market study to have an understanding
about the target customers and based on the customer profiles and consumer behaviour pattern,
they should develop the contents. It should be made in a manner which would generate the
maximum web traffic for the products, leading to maximum sales.
Increased affiliate marketing: This refers to a performance based marketing technique,
in which a business rewards one or more affiliates for each customer it brings through their own
marketing technique (Dwivedi, Rana and Alryalat 2017). This type of marketing is highly
dependent on the ability of the customers to track down the source of the products promoted.
Amazon should provide their specific URL for advertising the products. The affiliates, such as, a
blogger creates a link to that URL while writing about an article about that particular product. If
the customers click on the link while reading the article, they would be redirected to Amazon’s
page of that product. Thus, through affiliate tracking software, the sales of the blogger and
Amazon, both increase. Hence, as stated by Edelman and Brandi (2015), affiliate network refers
to the readymade network of the marketers looking for affiliate schemes, which are mutually
beneficial.
4.0 Conclusion
It can be concluded that Amazon has successfully developed a distinctive business model
for delivering good quality products at a competitive price along with focusing on the best
customer shopping experience. Over the past two decades, Amazon has adopted many innovative
techniques to increase its global market share. In Australia also, Amazon has been successful

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since its inception in 2013. Within few years, Amazon has become a household name due to its
marketing and business strategies, as it has emerged as a revolutionary cost leader. It has control
over its distribution channels that helps to reduce its inventory supply cost. However, in the near
future, it should further invest in innovative technology, inclusion of luxury brands, affiliate
networking, content marketing and including more local businesses in their product lines to
increase their customer base in Australia.

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References
amazon.com.au 2018. [online] Available at: https://www.amazon.com.au/ [Accessed 16 Sep.
2018].
Ang, C. and Rusli, H., 2018. The Impact of Marketing Mix 4Ps and Consumer Behavior toward
Purchase Decision of Adidas Products. iBuss Management, 6(2).
Baker, M.J., 2014. Marketing strategy and management. Macmillan International Higher
Education.
Carr, F., 2018. Amazon Is Now More Valuable Than Microsoft and Only 2 Other Companies Are
Worth More. [online] Fortune. Available at: http://fortune.com/2018/02/15/amazon-microsoft-
third-most-valuable-company/ [Accessed 18 Sep. 2018].
Dwivedi, Y.K., Rana, N.P. and Alryalat, M.A.A., 2017. Affiliate marketing: An overview and
analysis of emerging literature. The Marketing Review, 17(1), pp.33-50.
Edelman, B. and Brandi, W., 2015. Risk, information, and incentives in online affiliate
marketing. Journal of Marketing Research, 52(1), pp.1-12.
Gregory, L., 2018. Amazon.com Inc.’s Mission Statement & Vision Statement. [online] Panmore
Institute. Available at: http://panmore.com/amazon-com-inc-vision-statement-mission-statement-
analysis [Accessed 18 Sep. 2018].
Ireckon.com, 2017. What is the Amazon Australia threat and what to do about it? - Ireckon.
[online] Ireckon. Available at: https://www.ireckon.com/customer-experience/amazon-australia-
threat/ [Accessed 18 Sep. 2018].

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Jackson, G. and Ahuja, V., 2016. Dawn of the digital age and the evolution of the marketing mix.
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