MBA600 Assessment 1: Amazon.com, Inc. Strategic Analysis Report

This report provides a comprehensive analysis of Amazon.com, Inc., focusing on its competitive advantages and strategic position within the e-commerce market. The report begins with an introduction to Amazon, outlining its business model and key operations. It then delves into an overview of the company, highlighting its unique aspects and IT infrastructure. The analysis includes an examination of Amazon's competitive advantages, such as its extensive product line, strong brand recognition, and technological expertise. The report also explores Amazon's strengths, weaknesses, opportunities, and threats (SWOT), providing an environmental analysis that considers both external and internal factors. The report concludes with a discussion of Amazon's strategic challenges and recommendations for future growth, including the assessment of Kindle Fire and smartphone ventures. The analysis draws on various academic sources to support its findings, providing a detailed and insightful assessment of Amazon's position in the market.

Amazon.com, Inc.
Introduction
Amazon.com, Inc. is a multinational and technological company established in
Washington that emphases on cloud computing platform. The year 2015, Amazon
exceeded as greatest valued merchant in United States by market capitalization.
Amazon was further launched its operation in India in June 2013, latterly the company
launched its website. The organization widely offers variety of choices in books,
televisions show, movies, house items, glossaries among other personal requires
(Hardey, 2009).

Overview of Amazon Company
 Amazon.com, Inc. has a unique and pulverized breaking deviations in both business and
technology, and over the past eras it has formed an ongoing IT infrastructure defy for many
senior expert executives. Amazon has a web system, "full-featured service that includes
computing and storage capacity, content delivery, data management, software, networking,
payment and billing systems and other applications” (amazon.com Inc.,). According to (Varia
and Mathew, 2014) Amazon Web Service should be prolonged to enable the developers meet
their needs. The Amazon Web system has short term and long term profitability and growth
(Varia and Mathew, 2014).

According to (Varia and Mathew, 2014);
 The reasoning behind their low short term profitability is because Amazon has large capital
investments. It is long term profitability is high because it is a very high growth market.
 There are several pros and cons to the Amazon web as well, some pros are there is available
capital, it can grow pretty big and it helps in expanding customer base several cons are it is an
untested market, and it has a short life span in technology.
 Some consistence’s that Amazon has with this service is that they are still favoring long term
profitability over short term; they are also being consistent with resources because they are
just expanding. In the end Amazon has great potential and is a successful growing company
and it going to do great things (Varia and Mathew, 2014).

Competitive advantages over its competitors
 Amazon can gain a competitive advantage over its competitors (Haucap and Heimeshoff, 2014). I believe
this because they have grown so much just, from where they started off which was just an online company.
 They started solely as an online book store and now they are selling so many products. They sell books,
music and movies, consumer electronics, computers and office supplies, tools and stuff for cars, food and
household items, toys, video games sports and fitness equipment, clothing and stuff for people of all ages
and they have the kindle (Haucap and Heimeshoff, 2014). Not only do they sell all of these products they
have several non-retail items like their web service, fulfillment by amazon and commission based selling.
 They also made smart decisions in buying out several companies like IMBD, exchange.com, musicfile.com,
planetall.com, jungle.com, and bibliofind.com this was a smart move for amazon because it gave them an
advantage because now they have rights to sell more items and they took over some of their competitors to
gain an advantage(Haucap, and Heimeshoff, 2014).

 Doing this also helped amazon to compete with Google, eBay and Apple and improved their retail software
services (Haucap and Heimeshoff, 2014). What also makes amazon stand out is that their brand which is well
known; everyone now knows about amazon and most likely has bought from their website.
 They have a lot of expertise in technology and have a one-click system. They also have such a wide base
product line that it puts them in a great position because one person can pretty much buy anything they want
from amazon because of all the stuff they sell.
 Another great thing amazon does is that a lot of their items have lower prices and they have great deals with
shipping and delivery prices. Lastly, they have the kindle, which is well known for amazon, and they sell it
the cheapest and they are the ones or manufactured it. Therefore, in the long run I do believe Amazon can
gain and keep a competitive advantage (Haucap and Heimeshoff, 2014).

 Amazon though has so many opportunities for their company they have online movies, music and online books, they are
growing globally and expanding their presence in other countries, they have expanded their technological market and
the customer base for doing things and buying things online is growing every day. Some threats they face are relying on
other vendors for their products because they have to make sure those vendors are going to have the product and that
they are willing to give it to amazon at prices they want. They have major competition and face complications with the
government (Matzler, Bailom, Friedrich and Kohler 2013).
 Amazon does have several strengths, weaknesses, opportunities and threats for their company though. Some strengths
for amazon.com are that they have a strong IT system, they have several new skills through acquisitions, they have a
really strong brand image and they have extensive product lines at pretty low prices. They also focus a lot on R&D and
they have a lot of diverse products (Matzler, Bailom, Friedrich and Kohler 2013).Next, we have their weaknesses, they
do not have many different products compared to other people, they have low profit margins and they have a lot of
products so they really cannot focus on one thing because they have millions of products.
Sustainable Competitive advantage diagnosis

Environmental analysis determines factors that can critically affect business operations. Amazon
improving organizational environment will be a reflection of the organizational strategies.
Amazon’s management will need to take environmental factors, such as, environmentally safe
products and packaging, into consideration when analyzing the organizational environment.
Using past data and sales figures will aid the managers in finding a consistent pattern to better
forecast the company’s future success. An analysis is important for Amazon company in order for
the company to be able to predict and follow what environmental factors could potentially affect
business (Reyes-García, Orta-Martínez, Gueze, and Luz et al, 2012).
Environmental Analysis (External and Internal)

 Durable brand - Amazon.com Inc. has the largest online retailed market brand. The long serving of this
company in early years, its strength is in authority for the rapid business growth.
 Combination of wide product – the extensive combination of widely product mix it makes customer easily find
the needs and wants on the firm’s website. This supportive attractiveness provide the firm with crucial success.
 High returns in the selling – one of Amazon’s strength is having the highest revenues collection in the company.
The analysis shows that Amazon.com Inc. has necessary strength to uphold the e-commerce market spot
(Ruvolo, Schirmer and Zeller, 2011).
 Amazon.com Inc.’s e-commerce victory relies on its prominent assets. The Analysis model is the aspect that counts the
strategic issues that the business uses to develop its corporate. The following are strengths that supports the growth of
Amazon according to (Ruvolo, Schirmer and Zeller, 2011).
Amazon.com Inc. Strengths

 Amazon Company breed its returns from technologically advanced country like USA. A time when other organizations
are fully developing their established markets, then for the Amazon it would become hard to contend and infiltrate in
such markets. The organization’s Partial brick-and-mortar existence also attracts customer with limited ability to
assured product, which are supplementary sellable in bodily supplies than online gallery. Therefore Amazon.com Inc.
should maintain strategic offline and online competitive advantage to overcome its weakness (Talbot, 2009).
 Certainly imitable business typical
 Partial perception in mounting markets
 Partial brick-and-mortar existence
 Amazon’s weakness present challenges that bounds its e-commerce corporate. This phase of the analysis outlines the
internal deliberate aspects that execute technical hitches in rising the business. The following are the weaknesses that
are most significant on Amazon;
Amazon’s Weaknesses

1) Developing markets penetration – this establishment gives Amazon a strong move and
advantageous competitive edge before other online large retailed companies before they find
their roots (Fanning and Drogt, 2014).
2) Brick-and-mortar trade expansion – Amazon Company has stores to increase and improve
their competition against big retailers such as Walmart (Fanning and Drogt, 2014).
3) Enhance actions to ease fake sales – some issues that Amazon Company is facing is the
ongoing sales of fake items on the e-commerce website, which is generally opposite to
customer needs. The company is brought to address and present improved opportunities to
its measures and policies (Fanning and Drogt, 2014).
 Amazon Company has various opportunities that are available to growth of business. The model
analysis ascertain the factors that the company could use to develop its business, and Amazon.com Inc.
has the following linked opportunities:
Amazon.com Inc. Opportunities

Threats Facing Amazon.com Inc.
 Amazon surfaces a number of important risks in the online marketing. Amazon.com Inc. should
note down a statement for the following threats according to (Smith, Smith and Smith, 2011).
 Cybercrime
 Imitation
 Violent competition with largely retailed companies
 Cybercrime looms practically every single online retailed company. Amazon must keep stringent
measures to counteract cybercrime attacks against its online operations. For example, the
company must intensify its network security efforts (Smith, Smith and Smith, 2011). Also,
Amazon.com Inc. faces the issue of imitation, considering that its business model is easily
imitable. The appearance of this threat could reduce the company’s market share.

 Amazon has several strategic things that they should change one thing they should
change is getting rid of kindle fire the kindle fire is not as profitable as the regular
kindle. They should just keep the regular kindle the reasoning behind this is because
amazon is getting into a very competitive market with the kindle fire.
 They are in a competitive market because the kindle fire is just like a tablet from apple
it does basically, what a tablet does. The kindle fire cost more to produce then the
regular kindle and amazon made amazing sales with the regular kindle even though it
was sold at cost but this had helped them gain access to the e-reader and tablet mark
Conclusion