Porter’s Diamond Factors of Amazon

This article discusses Porter’s Diamond Factors of Amazon and how it has achieved a competitive advantage in the market. It covers factors such as factor conditions, demand conditions, related and supportive industries, government, and chance. The article also talks about Amazon’s firm, strategy, and structure. The subject is Marketing and the document type is an essay.

Running Head: AMAZON 0
Amazon
Marketing

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Porter’s diamond factors of Amazon
Factor condition
The factor condition is basically divided into the two types- advanced factors and basic
factors. Resources both physical as well as human, capital resources, and infrastructure come
under the factor conditions. It is true that Amazon is one of the highest revenue earning
company. Due to this, it has competitive advantage over the capital. Besides this, it also has
skilled human resources that helps the company in competitive advantage over other
companies. It is founded that United State has various natural resource that helps the Amazon
in doing business.
Demand conditions
It is true that quality of demand is more essential than the quantity. Due to its innovative
services, Amazon is able to achieve the competitive advantage in many countries. It is
founded that ecommerce market has ample growth in U.S. Due to this fact, it is clear that
Amazon is getting prosperous growth in U.S (Bajpai, 2018).
Related and supportive industries
Supportive and related industries are those with whom firms share and coordinate the
activities in the value chain. Alibaba and Ebay can be seen as the supporting industries of
Amazon. These two industries also provide the technological advantages and complementary
services to buyers in various countries.
Government
In the Porter’s diamond model, government has two essential components. Firstly, it is
required by the government to be stable. By doing business in US, Amazon lowers the risk
for doing business in other country. By properly cope up with the rules and regulations made
by the government; it can lower down the risk. From the report, it is founded that US
government will be the biggest customer of Amazon (DePillis, 2018). It is seen that, it will
hold the various contracts with the federal agencies. Besides this, Amazon will also pursue
the other type of federal business. Due to improvement in efficiency, it has high support for
the US government.
Chance- Chance is an external factor that can help in competitive position of the industry.
Due to increasing demand of E commerce in various countries, it is getting several chances to
explore (Pasquale, 2017). When Antitrust Becomes Pro-Trust: The Digital Deformation of
US Competition Policy.Due to the supportive environment at US, it is delivering its product
cheaply as well as quickly. It has also become a retail giant by getting competitive advantage
in various aspects.

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Firm, strategy, and structure
Amazon is known for its cooperative attitude. It believes in doing innovation in its entire
product category. It has also adopted various business strategies that can explain the
favourable position where Amazon is right now. For example- it will be successful if does not
compete with other firms to achieve competitive advantage. It believes in connecting with
large number of customers through its online chain (Dolata, 2017).

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References
Bajpai, P. (2018). Reasons why Amazon will continue its Robust growth. Retrieved from:
https://www.nasdaq.com/article/5-reasons-why-amazon-will-continue-its-robust-
growth-cm1010255
DePillis, L. (2018). Amazon’s Biggest customer may soon be the US government. Retrieved
from: https://edition.cnn.com/2018/11/15/business/amazon-government/index.html
Dolata, U. (2017). Apple, Amazon, Google, Facebook, Microsoft: Market concentration-
competition-innovation strategies (No. 2017-01). Stuttgarter Beiträge zur
Organisations-und Innovationsforschung, SOI Discussion Paper.
Pasquale, F. A. (2017). When Antitrust Becomes Pro-Trust: The Digital Deformation of US
Competition Policy. United Kingdom: Routledge.