Case Study: Analysis of Amazon's Market and Life Cycle

This case study provides an in-depth analysis of Amazon, focusing on its industry and market. The study begins with an introduction to Amazon, followed by an examination of the e-commerce market, including its size, growth, and the product life cycle stages relevant to the industry. The analysis covers the introduction, growth, maturity, and decline stages, along with the growth rate of the e-commerce market. The case study highlights Amazon's strategies, competitive advantages, and market position. The report concludes with a summary of key findings and references relevant sources. The analysis emphasizes the importance of understanding the market and the lifecycle of products in evaluating a company's success and growth.

Running Head: Analysis of Amazon 1
Case Study: Amazon
Student Name
2/10/2020

Analysis of Amazon 2
Contents
Introduction......................................................................................................................................3
Industry / Market Analysis..............................................................................................................3
Market Size......................................................................................................................................5
Stage of Life Cycle..........................................................................................................................5
Introduction..................................................................................................................................5
Growth Stage................................................................................................................................5
Maturity Stage..............................................................................................................................6
Decline Stage...............................................................................................................................6
Growth Rate.....................................................................................................................................7
Conclusion.......................................................................................................................................7
References........................................................................................................................................8

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Introduction
Amazon has been a leading e-commerce retailer to provide all products at your home. In
past it was operated from desktop and now from the mobile app. Amazon is making things very
easy and saving a lot of time. The buyers have trust towards Amazon products and they love to
shop at Amazon(Amazon.com, 2019)
In the following parts there are details of Amazon, its market size, growth and product
life cycle.
Industry / Market Analysis
It refers to study and collection of information about market positive and negative side
for the industry. By industry analysis it is easy to understand businesses and its growth, and
purpose (DePillis, & Sherman, 2019)
Consumers around the world spent approximately $3.46 trillion through online business
in 2019, up from $2.93 trillion in 2018, rendering to Internet Retailer's estimate, a Digital
Commerce 360 brand. The estimated development in worldwide web proceeds of approximately
17.9 per cent in each year would be a weakening from previous year's 20.7 % hike. World online
revenues, however, continue to grow quicker than the more competitive ecommerce market of
U.S., which Online Vendor estimates in 2019 would increase by 14.0 per cent (Gessen, 2014).
Every year, virtual income endures to raise, greater improvements are needed to attain the
equivalent level of development, so certain slowing sorts logic. Ecommerce diffusion has been
progressively rising— with the share of virtual merchandising spending recording 10.5 percent
in 2016, increasing to 12.3 percent in 2017, and concluding at 14.4 percent in 2018, Internet
Retailer evaluations. According to the report, the impetus will endure into 2019 with infiltration
arctic of 16.0 percent (Hall, 2012)
Consumers invested $601.75 billion online with U.S. retailers in 2019, up 14.9 per cent
from the previous year's $523.64 billion, according to the US. Quarterly ecommerce figures for
the Department of Commerce published Wednesday. That was a higher growth rate than in 2018,

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when the Department of Commerce reported online sales grew year-over-year by 13.6 per cent.
(Palmer, 2017)
In the fourth quarter of 2019 US revenues for ecommerce hit $187.25 billion, up 16.4
million from $160.89 billion during 2018 year on year. Q4 went much better in 2019 than in
2018, with only 10.8 percent increase in online sales. This was the second lowest quarter ever,
after a 6.1% decline in the fourth quarter of 2008.
There are three main operational strategies through which it has been able to maintain
sustainable competitive advantage are low-cost leadership, customer differentiation strategy and
focus strategy (Rey, 2019)
Market Size
The US, with a turnover of 365 billion dollars in 2019, is the second biggest eCommerce
sector, putting the US ahead of Japan and China. With a 16 percent increase, the US ecommerce
market increased by 13 percent worldwide in 2019. E-Commerce revenues are still rising. New

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markets are developing and there is also scope for further growth on existing markets. Over the
next few years, economic growth will continue. Their expanding middle class and lagging offline
shopping infrastructure will be pushed through East and South East Asia (Hall, 2012)
In the year 2018, the U.S. market was having 49% share of Amazon. The share is more
than its top three competitors e-bay, Wal-Mart, and apple. The Amazon is identified as one of the
most valuable across the globe. In the U.S. Amazon has become a leading e-retailer with 280.5
billion U.S. dollars in 2019 net sales. The market of e-commerce is extending broadly as now it’s
not limited to desktop retailing as there is mobile e-commerce (Reiff, 2019)
Stage of Life Cycle
The product life cycle consists of mainly four stages such as:
Introduction
This is the first stage where company brings its product for the very first time in the
market. Throughout 2000, a growing number of businesses portrayed their offerings on the
World Wide Web in the United States and Western Europe. The sense of the ecommerce term
was changed at that point. The term electronic commerce was defined by people as the process
for the purchase by secure connections and electronic payment services of available goods and
services over the Internet. Though the dot-com flop in 2000 produced disastrous consequences
and numerous ecommerce businesses were disappointed, the retailers of "brick and mortar"
renowned the ecommerce recompenses as well as started to add these competences to its web
sites. (Gessen, 2014). Amazon was one of the first e-commerce companies to develop an affiliate
marketing system, and now generates nearly 40% of its revenue from suppliers and third-party
retailers offering and selling products on the marketplace. In 2008 the film is now "The Stolen
Kid" funded by Amazon and 20th Century Fox.
Growth Stage
The next stage comes when the product qualifies the first stage, introduction. it is the
recent stage of ecommerce industry. Since the humble beginnings of e-commerce, e-commerce
has grown rapidly, projected at USD 434.2 billion by 2017. The impact of e-commerce cannot be

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discounted as it begins to pervade everyday life, giving tiny, medium-sized and large companies
and retail consumers tremendous incentives.. For example, Amazon has been shown to sell more
than 426 items per second, setting the standard for both customer’s oriented websites, as well as
a slight supply chain. (Hall, 2012)
Maturity Stage
It is the stage where the growth of product touches a peek point. It is the highest stage
where any product growth can go. It is the stage where the industry focuses to protect market
share from its competitors. The Amazon will make some strategy to protect its captured market.
At this stage, the product demand can remain same or decline (Premack, 2018)
Decline Stage
The last stage for every product in which the demand for product starts declining. At this stage
there are two options for the company that continue with the product or close it. To start
something new requires high investment. The increase in level of competition in ecommerce
industry will create an issue of decline stage for small companies. However, the revenue of giant
companies such as Amazon will also highly affected at such stage (Rey, 2019)
Growth Rate
U.S. sales of physical goods for the online retail market in 2019 amounted to $365.2
billion and are expected to reach nearly $600 billion by 2024. It is identified by the business and
its products ratings, its success and its rank. The rating should be 3.5 stars more only then it be
called as successful and growing. And the products should be come under 50,000 ranks then the
company can be called as growing. As new technologies are introducing growth rate also
fluctuates. Its revenue in the fourth quarter of 2018 is $72.4 billion. The revenue is growing at an
annualized rate 25.97% from past three years. Amazon mainly earns from its retail subscription
and web services as retail is the primary source of Amazon’s revenue (Reiff, 2019)

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Conclusion
The above report can be concluded here that Amazon is one of the top online retailers. Its
demand in U.S. is rapidly increasing. The competitors are increasing and threat of new entry
force Amazon to be the best one. As technology updates Amazon updates itself. It mission to be
the customers centric company across the globe will be fulfilled soon. The size of market from
beginning till now is extending highly and still it’s rising.

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References
Amazon.com. (2019). Who we are. Retrieved from Amazon.com:
https://www.aboutamazon.com/?utm_source=gateway&utm_medium=footer
DePillis, L., & Sherman, I. (2019, July 5). Amazon'S Extraordinary 25-Year Evolution. Retrieved
from CNN Business: https://edition.cnn.com/interactive/2018/10/business/amazon-
history-timeline/index.html
Gessen, K. (2014, November 6). The War Of The Words. Retrieved from vanityfair.com:
https://www.vanityfair.com/news/business/2014/12/amazon-hachette-ebook-publishing
Hall, M. (2012, July 11). Amazon.com. Retrieved from Britannica:
https://www.britannica.com/topic/Amazoncom
Palmer, A. (2017, May 20). Here's What Wall Street Was Saying About Amazon When It First
Went Public 20 Years Ago. Retrieved from The Street:
https://www.thestreet.com/investing/stocks/here-s-what-wall-street-was-saying-about-
amazon-when-it-first-went-public-20-years-ago-14135429
Rey, J. D. (2019, May 3). The making of Amazon Prime, the internet’s most successful and
devastating membership program. Retrieved from Vox.com.
Rusli , E. M. (2012, March 19). Amazon.com to Acquire Manufacturer of Robotics. Retrieved
from Dealbook: https://dealbook.nytimes.com/2012/03/19/amazon-com-buys-kiva-
systems-for-775-million/