Holmes Institute: Analysis of Amazon Kindle Fire's Business Strategy

This report provides a comprehensive analysis of Amazon's Kindle Fire, examining its market introduction, target segments (readers, gamers, and entertainment enthusiasts), and competitive advantages. The report explores the influence of Jeff Bezos on Amazon's innovation and profitability, highlighting strategies such as Amazon Prime subscriptions to enhance user engagement. It delves into competitive dynamics, including the threat of new entrants and the emergence of substitute products like the Nook, as well as Amazon's corporate strategy of offering the tablet at a lower price. Strategic management theories, including survival-based, profit maximization, and resource-based theories, are applied to understand Amazon's approach. The report also discusses acquisitions, distribution strategies, and the international market, including cooperative strategies with Walmart. In conclusion, the report emphasizes Amazon's effective strategies to gain an absolute advantage in the market and generate revenue through the Kindle Fire.

Application of Strategy Models
By (Name)
Course
Professor
Holmes Institute
City and State located
Date

Summary of the case study
 The case study is about how Amazon introduced the Kindle Fire tablet
to the market and how the product has been since its launch.
 From the reading, the product has three target segments which target
the users who love reading, the gamers and those who love
entertainment.
 Kindle Fire has an absolute advantage over their rivals as they offer
distinguished services.
 The tablet also helps their users to purchase and download books
that they can read, and it is specifically designed for reading.

Summary of the case study
 The case study also shows how Jeff Bezos has been influential in the
growth of Amazon and how his attributes led to the innovation of the
product.
 Amazon entertains the users if Kindle Fire by the subscription they
have.
 Jeff Bezos is an influential man, and through his innovation, his firm
has enabled the company to make some huge amounts of profits

Business strategy
 Amazon came up with strategies to ensure that the Kindle Fire will
attract more sales.
 Some of the strategies implemented is giving a one-month
subscription to Amazon prime in a bid to encourage the customer to
integrate with the ecosystem content of Amazon.
 One a consumer purchases the tablet; then they get the opportunity
to enjoy these features. The prime subscribers can access up to
13,000 movies for free.
 Amazon Kindle Fire offers its users an efficient e-reader, and this
gives them an edge over their rivals

 With the feature, the tablet will be in a position to attract more sales
especially from the people who love reading.
 Amazon is aiming to revolutionize reading through the tablet, and the
feature will help the users purchase and download their favorite book
and thereby, from the niche they can make sales which will generate
profit for the organisation.

Competitive dynamics
 There is a threat for new entries of firms who will venture in the tablet
industry. With the entry of new firms, the competition for Amazon
Kindle Fire is expected to rise.
 After the launch of Kindle Fire, Barnes & Noble implemented the idea,
and they came up with their product named Nook. Other companies
also came up with similar products.
 The substitute goods offer similar tablets to the Amazon Kindle Fire,
and thus the consumer will choose the product that will best suit their
needs. The consumer can forgo Amazon Kindle Fire, and this will
deter their sales.
 With the consumer’s ability to choose the cheapest commodities in
the market, Amazon will be forced to lower the cost of the tablets
hence minimizing the profit margin for the organization.

Corporate Strategy
 Amazon is willing to sell their tablet at a relatively lower price to
encourage and boost the sales of the tablet.
 The tablet is efficient in the sales of its connected e-retail ecosystem.
 The profits of the tablet are not only generated from its sales but also
subscription of other services like books, movies and the TV shows.
 The strategy helps the company to generate more profits from its
services.
 Consumers prefer buying products that are relatively cheap and with
the low cost being charged the company is able to attract sales.

Strategy management theory
 The survival-based theory states that the organisation need to adapt to
the business environment even though they might become competitive
(Morden, 2016).
 Amazon had to adapt and venture in the different market beside their
online sales of other products. Through the adaptations, the organisation
has been able to generate sales of the products.
 The company does identify the needs of the consumers, and when the
demand for the product is high, they can capitalize on it and supply the
goods to the market. Being able to adapt and capitalize on the needs of
the consumers is crucial to any business organisation.
 One of the management theory includes the profit maximization theory
which entails that the objective of a business is to maximize profits in
the long run (Morden, 2016).

Strategy management theory
 Amazon tries to maximize its profits in the sales of the Kindle Fire.
 The tablet has a feature where the customers of the product will get the
opportunity to subscribe to some of their favorite channels and magazines.
 The resource-based theory states that the source of the competitive advantage
of a firm depends on the resources that an organisation owns (Morden, 2016).
 Amazon is a huge company and it has a load of capital, they can easily invest
in a research to know the best way they can produce a commodity. The
company is capable of investing in a large array of commodities, and this gives
them an edge over other organizations.
 Having resources is vital since a company can expand its business with ease
hence enabling them to make more profit.
 The human resource-based theory emphasizes the importance of the human
element in the success of the organisation (Rothaermel, 2015).

Acquisitions and Structure
 After placing the order, the product will be transported to the nearest
store where the consumer will have the opportunity of collecting the
product they ordered.
 As the firm has gone into the international market, the products are
being displayed at the stores where the potential buyers can
purchase the product.
 The acquisition of Amazon Kindle Fire is done through the online
platform and the distribution via stores.
 The products are mainly displayed online where buyers of the
products get the opportunity to check the product before placing an
order.

International Strategy
 The distribution of Kindle Fire is cost-effective as its products are offered
at a discounted rate in stores like Walmart.
 The stores help the organisation make sales of their commodities in other
countries hence making Amazon make more sales of the tablets.
 The stores are also efficient in foreign countries since they act as the
delivery point when the customer has placed an order.
 When they are pleased they can place an order and their product will be
delivered.
 Amazon Kindle Fire can be delivered internationally days after the order
was placed.
 The organisation is trusted by its customers, and this enables them to
purchase as they are confident that their product will be delivered.

Cooperative Strategy
 As a reading tool, the tablet is sustainable as it conserves the
environment.
 The production of the tablet emits fewer carbon gases to the
environment compared to the production of books which emits more
carbon gases into the atmosphere.
 The production of books also includes the use of wood which is
achieved by cutting down the trees.
 The cooperative strategy is a situation where two or more companies
work towards a common goal.
 Amazon and Walmart do work together to ensure that they sell Kindle
Fire.
 With the sale of the commodity, both organizations can be able to
make profits as a result of the sales.