Analysis of Amazon's Marketing Strategy and Core Fundamentals

This report provides a comprehensive analysis of Amazon's marketing fundamentals, focusing on key elements such as the marketing mix, segmentation, targeting, and positioning strategies. It begins by outlining Amazon's history and logo evolution, highlighting its transition from an online bookstore to a global e-commerce giant. The report delves into Amazon's targeting strategies, emphasizing geographic and demographic segmentation to cater to a diverse customer base. Furthermore, it examines the products offered by Amazon, categorized into websites, electronic devices, Amazon Web Services (AWS), and retail sector products. The pricing strategies employed by Amazon, including cost leadership and premium pricing, are also discussed. The report also explores the importance of 'place' in the marketing mix, detailing Amazon's shift from online-only to incorporating physical retail channels. The promotional strategies used by Amazon, encompassing traditional and digital marketing techniques, are analyzed to understand how the company effectively communicates with its customers. The report concludes by summarizing the key marketing fundamentals that have contributed to Amazon's success.

Fundamentals:
Assessment 1

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
CONCLUSION..............................................................................................................................19
REFERENCES:.............................................................................................................................20
Books and Journals...............................................................................................................20
Online...................................................................................................................................20

INTRODUCTION
Marketing fundamental refers to the discounted current value of a stream of future cash
flow which is attached to a particular asset. In simple words they are items in an organization
which have a direct impact on the future income streams of a security of that company
(Camilleri, 2018). Marketing fundamental are analysed with the factors such as marketing mix
elements, marketing segmentation, targeting and positioning. Amazon is an American
multinational company which focuses on an E-commerce, artificial intelligence, digital
streaming and cloud computing as well (About Amazon, 2021). It is one of the biggest companies
and among the most popular companies as well in the world. The report aims to describe the
elements of marketing theory and a series of blog posts to communicate with its target
customers.
MAIN BODY
Amazon history and Logo evolution blog
Figure 1 https://www.deccanherald.com/business/technology/amazon-prime-day-2021-sale-

top-deals-on-smart-tvs-1012318.html, 2021
Amazon is a multinational online retail company which provide different types of goods and
services to their customer through its online platform and mobile application. The company was
established in 1994 and the headquarters of the company is situated in Washington, United
States. It is a vast internet based business enterprise that works to sell books, movies, music,
housewares, toys, electronics, and many other goods. This is done either directly or by the
middleman between other retailers and Amazon.com’s millions of customers (Amazon.com,
2021). Company first start their business by offering books and food product to the customers
through their online stores and then afterwards they expand their business by offering different
types of electronics items, huge range of apparels, furniture and many more. Due to
development of technology all over the globe company start focusing on the digital streaming
of the films and web series. But after a year to create a thoughtful brand, Bozos changed it to
Amazon after realising that it resembles the word Cadaver. Amazon’s logo had three different
iterations in its meaning over the years. In 1994, the name was chosen primarily because it
began with the first letter of the alphabet. In starting the company was only famous for selling
its books online. The company enhanced the ease of customers as they were able to order
products online.
Initially the logo was the Amazon.com spelled in black font with a large yellow font
emphasising on O. Then it was replaced with company’s name with a straight yellow line under
it. In the tops the words such as ‘books, music and more’ were written in light grey colour. It
again changed it the name Amazon.com and under it have a curved arrow. It is the logo used till
now.

Figure 2 https://1000logos.net/amazon-logo/, 2021
Targeting by Amazon
Targeting is a strategy that is used to break the large market into small segments. It enhances
the focus on a specific group of customers. It allows the company to focus on its marketing and
also on brand message on a certain market which is more likely to buy the products and services
offered by it as compared to the other companies.
Figure 3 https://www.google.com/search?

q=stp&rlz=1C1CHBD_enIN986IN986&source=lnms&tbm=isch&sa=X&ved=2ahUKEwjr4vi
Ot4v1AhV-
zDgGHd5HB9AQ_AUoAXoECAMQAw&biw=1366&bih=657&dpr=1#imgrc=WDD0ThMdPJ
CC8M, 2021
Targeting is an effective, efficient and affordable way to reach the potential customers and
generate profits from it. Amazon have a huge customer base (Deepak and Jeyakumar, 2019). It
has segmented its customers on the basis of various factors such as geographic and
demographic. Every segment criterion has various customer target groups in them. These
groups help the company to focus on a particular kind of customers. Some of them can be
explained as follows:
Geographic segmentation-
 Region- It covers over 100 countries
 Density- Both urban and rural areas
Demographic-
 Age – 14 and above
 Customer life cycle- Adult, child, old, bachelor, married, no children couple, family
 Occupation- Employees, professionals, students, home-makers
 Gender- Both male and female
Amazon is able to serve the needs and wants of the customers in an effective manner by using
proper targeting strategy. They are able to know about the specific needs and wants of the
audience and then provide them accordingly. It keeps the customers satisfied and motivate them
to make repetitive visit. Along with that, there is key role of positioning in regard to
communicating with the employees in proper manner (Dolnicar, Grün and Leisch, 2018).
Positioning can be defined as a strategy of creating effective brand image in the mind of people.
The positioning strategy of Amazon is Low-price, extraordinary convenience, instant access,
and comprehensive selection. They focus of Amazon is on providing high value at low price
(Brand Positioning Strategy -Amazon, An Example, 2019).

Blog on Products offered by Amazon
Amazon is international e-commerce company that deals in variety of products such as books,
music, electronics, games, clothes and movies. It is known as one of world's biggest online
retailers. They carefully invest in other smaller companies to enable itself to stay ahead in its
field, and continues to expand its product range. Amazon is famous for providing quality
products to its customers all over the world. Product is the first component of marketing mix.
These products are being delivered to the customers by using delivery services. The product
base of the company and it sells almost everything (FERNANDES, Reis and Serio, 2017).
Amazon started only with books and till date known as the highest book seller in the world. The
company introduced Kindle which provides electronic books to the readers with the motive of
big revolution of converting hard paper to digital eBooks. At the current time, the Amazon
products can be divided into the following four categories:
Amazon websites: The company provides the option to third party to sell the products through
their website. There are various sellers that register on the website of amazon and have got a
platform to sell their products online. This helps them to reach more and more customers via the

website provided by Amazon (Lahtinen, Dietrich and Rundle-Thiele, 2020). There are dozens
of products categories such as clothes, home décor, etc. that is being sold by these sellers. It is
analysed that, about 58% of items sold in Amazon websites in 2018 was from third-party
sellers. Another important product sold by company is prime membership, there are more than
100 million Paid Prime members.
Figure 4 https://www.versionmuseum.com/history-of/amazon-website, 2020
Electronic devices: The company is earning huge amount of profit by selling electronic
products. It includes Kindle e-readers, Fire TVs, Fire tablets, and Echo. Since the first
generation of echo, people have purchased more than 100 million Alexa-enabled devices. The
company works to enhance the ability of Alexa, so that it can understand the questions
effectively and give proper answers to them.

Figure 5 https://www.pocket-lint.com/smart-home/news/amazon/138846-what-is-alexa-how-
does-it-work-and-what-can-amazons-alexa-do, 2021
Amazon Web Services (AWS): This segment provides wide range of storage, database, global
compute service offering. The company provides cloud computing platforms to the users on
demand. The cloud computing platform and APIs are available to individuals, companies, and
governments, on a metered pay-as-you-go basis. The AWS technology is implemented at server
farms throughout the world, and maintained by the Amazon subsidiary (Lim, 2021). There is
fees based on combination of usage, operating system, hardware, software, or networking
features chosen by the subscriber required availability, security, redundancy, and service
options.

Figure 6 https://www.zarantech.com/blog/an-introduction-to-amazon-web-services-aws, 2021
Retail sector products: The business organisation also sells retain sector products. The sale of
apparels is good as seen in their online retail stores. They are able to attract the customers to
buy clothes and that assist them in earning good revenues.
Figure 7https://www.amazon.in/Apparels-Printed-Cotton-T-Shirt-Sleeve/dp/B08MYNF17G,
2021

Pricing strategy of Amazon
Pricing plays a key role in success of a business organization. It is important for a company to
set right price of the products that are being offered by them. Price refers to the consideration
for product or service offered. This element answers the questions such as what will be the
value or offering to buyer, what are the established prices if similar products in market, what
price the competitors are offering, what discounts should be offered with the product and will
the consumers accept that price (Ndofirepi, Farinloye and Mogaji, 2020). The company has
huge competitors and that is the reason they want to set best price strategy. It focusses on Cost
Leadership as it offers the lowest prices to its customers so that it can beat the competitors for
all of its products. The use of cost leadership helps them to attract the customers and retain them
in the organization. They sell electronics, clothes, games, jewellery etc. By providing the goods
at prices low then competitors the company is able to attain success and grow their customers.

Figure 8 https://www.versionmuseum.com/history-of/amazon-website, 2021