MGT4100 - International Business Strategy: Amazon's Global Expansion

This report examines Amazon's international business strategy, focusing on its global expansion and economic integration. It highlights Amazon's entry into various international markets, including the UK, China, Brazil, Singapore, and Australia, and its strategies for adapting to local market conditions. The report discusses the significance of economic integration in reducing trade barriers and facilitating international business practices. Amazon's approach to aligning operations with local trends, partnering with local service providers, and offering features like language and currency options to international customers are analyzed. The report concludes that Amazon's ability to integrate its operations with international markets is crucial for its continued success and competitiveness, emphasizing the importance of adapting strategies to meet the specific requirements of each market.

INTERNATIONAL
BUSINESS
STRATEGY

Table of Contents
INTRODUCTION...............................................................................................................3
Main Body...........................................................................................................................3
CONCLUSION....................................................................................................................7
REFERENCES....................................................................................................................8

INTRODUCTION
Internationalization is a process by which companies enter into overseas business in order
to explore business in different countries across the globe. Here, globalization has been ease out
the process of international business. Now, it is easy for companies to get enter into international
boundaries for the purpose of trade (Kitsios and Kamariotou, 2019). Main aim of
internationalization is to enhance the presence of business with an aim to earn higher amount of
profitability. The present report is based on Amazon which is prestigious multinational company
which is headquartered in US. It was started in 1994 & currently operating business in nearly 13
countries across the globe. Amazon is efficient in terms of managing favorable brand image
within different countries. The present report will cover integration of Amazon with international
markets.
Main Body
Amazon is a well known multinational organization which is being operated in several
countries across the globe. It has witnessed tremendous amount of growth within such a short
time of span. Initially, Amazon was an online book selling website that was founded by Jeff
Bezos in the year of 1994. In current time, Amazon has been set new standards in e-commerce
by offering variety of products such as mobile, home appliances, electronics, clothes, fashion
accessories & groceries. Amazon has expanded business overtime. In 1999, Amazon started its
international expansion (Ratten and Tajeddini, 2017). In 1999, it entered in market of UK by
acquiring online booksellers of country. Amazon continued business expansion by exploring
business in different countries. In 2004, it entered into the market of China by acquiring one of
the well known brand of online book-selling of China named as Joyo. Amazon is the world’s
largest online market place which is working in countries such as US, France, Ireland, Germany,
Spain, Mexico, India & more.
Economic Integration refers to an arrangement which reduces down the trade barriers
among different nations in order to facilitate international business practices. Here, trade barriers
are minimized so that economies of two countries can consolidated together for achieving better
outcomes. It emphasis over ease out of trade practices by eliminating tariff & non-tariff barriers,
customs & other such expenses. In simple words, economic integration signifies interconnection
of business as well as trading practices between different countries. It provides benefits in

several ways by minimizing government interference in trade practices. With this, efficiency
increases which further reduce down overall cost and increase wealth.
Economic integration makes it possible to execute trade at lower price & also enhance the
efficiency of economy in significant manner. Employees also get an international environment to
work along with the opportunity to work with diversify work force. With economic integration,
employees are allowed to move freely. Simultaneously, it also facilitates technology sharing that
eventually brings benefit for all economies. Apart from this, economic integration also
strengthen the relationships of two countries in terms of political, economical as well a social
manner. Employment opportunities are also generated through economic integration which
further improves the living standard of people within nation. It also put a profound impact over
GDP development of economy (Selvarajah and Meyer, 2017). However, it is imperative to assess
the external environment & prevailing trends within country while exploring business. Amazon
generates major revenue through global marketplace. It is one of the largest internet service
providers across the world which is working in several countries such as UK, Germany, Japan,
India, China and so on. It is working across developed as well as developing countries and likely
to adopt strategies as per the prevailing business environment of respective country. Amazon
offers quality protects at lower price so that it is able to gain the popularity among developing
countries such as India and China. In addition to this, company has been adopted several ways to
get enter into international marketplace. It entered in UK by acquiring one of the online
bookselling website and further started to provide different range of products to customers.
Alike, it entered into China in the year of 2004 by associated with a renowned online bookseller
Joyo and currently confronting tough competition with well known ecommerce company of
China which is Ali Baba.
Amazon is exploring the current boundaries by expanding business in different countries
& likely to select such countries which have great potential in terms of e-commerce adoption in
retail segment. In 2015, company expanded business in Brazil which is a developing country yet
has higher degree of potential of ecommerce adoption. For this purpose, they started an kindle
store and then opened a physical store where people go and interact with company
representatives in face to face manner. In majority of country, they use online book store or
kindle store to get enter into international market space. While entering into Singapore market,

Amazon used its prime app as an entry medium to explore business in respective country. It is
due to the mobile first nature of Singapore audience. Therefore, Amazon is likely to execute
detailed market research before entering into international market space. This is a reason that
company has gained significant acceptance by international markets (Ratten and et. al., 2017).
After ensuring significance presents in Singapore and Mexico, Amazon also stepped into
Australian marketplace in the year of 2017 by acquiring e-commerce firm Souq for $ 580
million. It is a significant opportunity for organization to establish its presence in the biggest
middle east market place. Here, Amazon launched business in new location & gained significant
market share by cutting the competition with local rivalries.
Economic integration is related with business expansion in more number of international
countries. While exploring business, it is highly important to alien operations as per the
prevailing trends within country. It helps in terms of gaining trust of customers & also assist
company in order to stay in competitive market place for longer period of time. In case of
Amazon, they have partnered with a lot of local service providers for offering timely delivery to
customers. They offer platform to local product & service providers to sale their product through
their websites. It is analyzed that people have great trust over local service providers which
significantly helps Amazon in terms of maintaining positive brand image of organization within
international markets. It is stated that Amazon is likely to adjust its current strategies in order to
cope up with current circumstances of international market. They integrate operations & make
appropriate modifications in current practices in order to get success in overseas market
(Suoniemi and et. al., 2020).
It is stated that Amazon offers features to all its domestic as well as international
customers to purchase products through website. For getting connected with international
audience in significant manner, they offer options to audience to change the language of website
& app for providing better understanding as well as shopping experience to customers. Here,
buyers can shop by using different currencies which are prevailing within respective countries.
International shopping feature has been introduced in order to motivate buyers to purchase
products outside the home market. This feature is currently available in Spanish, English,
Chinese, German etc. In addition to currency & language feature, there is also option to select
shipping & delivery speeds (AMAZON’S GLOBAL STRATEGY ONCE AGAIN KNOCKS THE

COMPETITION DOWN, 2021). Amazon put significant efforts for aliening its operations with
international market. It uses different taglines & marketing strategies for integrated with
prevailing environment of country. For instance, In India they use the tagline called “India ki
apni dukan” so that people can connect with the brand. In addition to this, they also imply all the
necessary rules, regulations, compliances for operating business without any legal hassles. They
also use different ways of supply & logistic management as per the prevailing environment of
respective nation. Therefore, Amazon has integrated its operations with international market. For
this purpose, it has established significant association with local retailers & service providers.
Apart from this, company has also adjusted its current business operations for integrating with
the environment of respective countries in which it is operating the business. This practice of
economic integration will help Amazon in meeting with requirements of international market iv
best possible way. By this, company will able to face competition with local service providers
which will enhance current level of profit ratio.

CONCLUSION
It is assessed with above mentioned information that economic integration signifies trade
practices between two countries for facilitating economic growth & development in both
countries in an efficient manner. Here, government interventions are minimized for facilitating
international trade. There is discussion regarding multinational company & the way in which it
integrated its operation in the context of international environment. It is monitored that Amazon
has been adopted several practices by which it is able to integrate its operations with
international market environment.

REFERENCES
Books & Journals
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Kitsios, F. and Kamariotou, M., 2019, September. Digital business strategy and information
systems planning: determinants of success. In International Conference on Innovation
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Ratten and et. al., 2017. Family entrepreneurship and internationalization strategies. Review of
International Business and Strategy.
Ratten, V. and Tajeddini, K., 2017. Innovativeness in family firms: an internationalization
approach. Review of International Business and Strategy.
Selvarajah, C. and Meyer, D., 2017. Leadership Excellence in Organizations in the Mekong
Region: A Comparative Study of Thailand, Cambodia, Lao, and Vietnam.
In International Business Strategy (pp. 391-418). Palgrave Macmillan, London.
Suoniemi and et. al., 2020. Big data and firm performance: The roles of market-directed
capabilities and business strategy. Information & Management, 57(7), p.103365.
Tang, R.W. and Gudergan, S.P., 2018. A Meta-analysis of the international experience–ownership
strategy relationship: A dynamic capabilities view. Management International
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Xie, Y. and Cooke, F.L., 2019. Quality and cost? The evolution of Walmart's business strategy
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2017). Human Resource Management, 58(5), pp.521-541.
Online:
The Peril and Promise Behind Amazon’s Global Push, 2018 [Online] Available through: <
https://www.buyboxexperts.com/blog/the-peril-and-promise-behind-amazons-global-push/ >
AMAZON’S GLOBAL STRATEGY ONCE AGAIN KNOCKS THE COMPETITION DOWN,
2021, [Online] Available through: < https://www.perzonalization.com/blog/amazons-global-
strategy/ >