University Report: Analyzing Amazon Kindle Fire's Marketing Strategy

This report provides a comprehensive analysis of Amazon's marketing strategy for the Kindle Fire, examining both its internal and external environments. The external analysis delves into the e-commerce industry's growth, competition, and the US market's receptiveness to online retail. Internal analysis explores Amazon's resources, capabilities, and core competencies, including a value chain analysis and identification of weaknesses. The report also includes a SWOT analysis and reviews current marketing strategies. The report concludes with recommendations for improvement, emphasizing the importance of pre-launch product testing, user-friendly design, and effective demo sessions to enhance customer acquisition and satisfaction within the competitive e-commerce market.

Running head: MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Marketing strategy for Amazon Kindle Fire
Name of the Student
Name of the University
Author note

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Executive summary
The aim of the paper is to analyze the marketing strategy of Amazon in introducing its new
product Kindle Fire using various analysis such as internal analysis and external analysis. It was
seen that in external analysis the e-commerce industry is a strong and growing industry and
offers a lot of competition from the rival firms offering similar products. However, United States
has offered a strong market to the e-commerce industry due to the rate of internet usage and easy
technology acceptability of the consumers in US. Moreover, it is seen that the company has been
successful in its new product launch kindle Fire. However, certain criticism has been received
which the company can solve by implementing pre-launch test of the product. It can also use
other strategies like manufacturing user-friendly products and carrying out effecting demo
session for increasing the customer base.

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Table of Contents
Introduction......................................................................................................................................4
External Analysis.............................................................................................................................4
Industry Background...................................................................................................................4
General Environmental Analysis.................................................................................................6
Industry Analysis.........................................................................................................................8
Competitive Environment............................................................................................................9
Internal Analysis............................................................................................................................10
Resources of the Firm................................................................................................................11
Capability identification............................................................................................................11
Core competency Analysis........................................................................................................11
Value Chain Analysis................................................................................................................12
Weaknesses................................................................................................................................14
SWOT Analysis.........................................................................................................................14
Current Strategies......................................................................................................................15
Strategies....................................................................................................................................16
Conclusion.....................................................................................................................................16
References......................................................................................................................................18

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Introduction
Amazon is a well-known brand carrying out e-commerce website for selling various
kinds of goods to the customers. The company has been growing since it has been launched in
1994 in the city of Seattle, United States (Gordini and Veglio 2017). It is also known for its
cloud computing business and one of the largest tech giants carrying out internet based retail
business all over the world. The company has the largest capital and sales based all over the
globe by maintaining a good brand recognition and customer base. Heff Bezos started the
business as a bookstore and later it was expanded in electronic business selling various electronic
devices. Along with selling the goods of other brands, the company also manufactures its own
electronic goods in the name of Kindle that offers unmatchable service to the customer. One of
its electronic goods named Kindle Fire was launched by the company in 2011 and offered
preloaded benefits and services (Amazon 2017). The paper analyses the marketing strategy
adopted by Amazon in launching its new tablet range Kindle fire in 2011. The report discusses
both the internal and external situation of the business that lead to the success of the new launch
such as the analysis of the industry it entered, its marketing plan, environmental analysis and so
on.
External Analysis
Industry Background
E-commerce industry consists of companies selling software services and goods to the
consumers that can help them improve their way of living and capabilities. In comparison to the
condition of other industries in the world, e-commerce is growing at a faster rate and is recording
huge orders and revenue. The growing condition of the industry is due to the improved usage of

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internet and busy life of the customers. Customers are not willing to visit markets to buy the
products. Selling in e-commerce industry takes place through three branches such as business to
customers, business to business and customer to customers (Laudon and Traver 2013). The e-
commerce business in United States is increasing continuously from past years. Retail sales from
e-commerce channels in United States have increased from $ 322 billion in 2016 to $353 billion
in 2017. The sale is expected to increase further to $484 billion in 2021. On the other hand, the
worldwide sale of the e-commerce retail industry is expected to reach $4trillion in 2020. Thus,
the industry seems to grow continuously both worldwide as well as in United States. However,
among all the e-commerce companies in United States Amazon ranks top in relation to sales and
orders. The company experienced 183 million visitors in 2017 (Emarketer 2017).
2015 2016 2017 2018* 2019* 2020* 2021*
0
100
200
300
400
500
600
E-commerce sales (in Billion U.S.
Dollars)
E-commerce sales (in
Billion U.S. Dollars)
Figure 1: E-commerce Sales
Source: (Emarketer 2017)
*=expected sales

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
General Environmental Analysis
It is necessary for the online industry or any other industry to carry out effective
environmental analysis in which it is going to launch a new product or enter in a new market.
This is because the environmental analysis helps them to analyze the extent to which the
consumers of that region will accept a new launch and the chances of risk while entering in that
market. Amazon will analyze the environmental situation of United States to analyze the usage
of online website by the consumers for purchasing retail goods and the chances of acceptability
of its new product Kindle Fire (Zalengera et al. 2014).
Political
United States is a politically stable and developed country offering a god scenario for a
company to operate. Moreover, the country also maintains few business laws that the companies
need to comply both in its internal and external environment.
Social
Socially the country is very advanced and a modern economy. The people of the country
love to live a luxurious life and have a keen interest in using new types of technology and
products. Moreover, the people of United States are too busy with their life and thus mostly shop
from online sources for their daily needs.
Economic
It is a highly developed and a mixed economy, which is also known as the largest
economy of the world. The GDP of the country stands a $18.26 trillion in 2016 which is quite
more than other economies of the world. Unemployment rate in the country has been decreasing

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
over the years and stands at 4.9 percent in 2016. These factors make the economy a suitable zone
for investing in new products (FocusEconomics 2017).
Technological
The country has continuously invested technology and innovation in various sectors. All
the sectors of the economy are slowly inducing software and digitization in their operations.
Information technology is also growing at a faster rate in the economy proving to be beneficial
for e-commerce industry.
Legal
Legal factor is important for any company in order to start its business in a new market or
introducing a new product. The corporate laws of the country regulate the power, finance and
other governance of the economy. The country also maintains a 35 percent in its corporate tax
that is required to be given by all the operating business in the economy.
Environmental
The economy is environmentally not that strong as it faces various issues such as
deforestation, climatic change, energy depletion and others. This is due to increasing
development of industrialization and globalization for the advancement of the economy. Thus,
various environmental conservation movements are carried out in United States by the non-
governmental organizations.
Thus from the above analysis it can be seen that most of the factors are suitable for
Amazon for its introduction of new products Kindle Fire that the consumers can buy from its
online website (Fozer et al. 2017).

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Industry Analysis
The industry in which the Amazon is operating in is an e-commerce retail industry in
which the goods are sold through online sources to the customers. An analysis of industry in
which a particular company operates helps the organization to analyze the amount of risk they
might face from the competitors and the chances of profit in that industry (Porter and
Heppelmann 2014).
Threat to new entrant
The threat from new entrant for an e-commerce industry is relatively high due to low investment
requirement and easy access to the internet. To open a new online business a new organization
does not require much investment to be put in buying and designing the website compared to
opening a physical store. However, investment is needed to manufacture electronic products like
Amazon Kindle (Webber 2014).
Threat of rivalry
The e-commerce industry faces a huge rivalry in its market because of the existence of
large number of competitors and no switching cost for the consumers. There are huge brands
similar to Amazon that operates retail business and offers various kinds of goods to the
customers such as eBay, Netflix, Google and others that offers similar products as Amazon and
offers action facility as well in which the customers can auction the price of the product they
want to buy. This put a great threat on the company operating in the e-commerce industry.
Bargaining power of buyers

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
It is seen that the buyers faces no switching cost to move from one online site to the
others. They just need to open their own account to buy the products and that requires no cost.
Thus die to low switching cost and existence of large number of sellers the bargaining power of
the buyers is high in this industry.
Bargaining power of suppliers
The suppliers of the industry serve these huge giants and do not lose their business by
bargaining on the price or any other reasons. This puts the suppliers at a low power to bargain
with these e-commerce companies.
Threat of substitutes
There are substitutes to this e-commerce industry such as the physical stores in the
market that sells electronic goods as well. Due to no switching cost, the consumer can easily shift
their demand from online companies to physical stores if they get the same product at lower
price. Thus, threat from substitute is relatively higher in this industry (Rothaermel 2015).
Competitive Environment
The e-commerce business exerts a lot of competitive environment to the
companies operating in it. Amazon too faces a lot of competition from its competitors that also
carry out online business selling electronic goods to the consumers. Its competitors are as famous
as Amazon is and is slowly growing in the e-commerce industry. The biggest competitors of
Amazon in United States are eBay, Netflix, Wal-mart, Apple Sites, Google and others. The
competitors of Amazon are in the electronic business and general merchandise segments as well
(Sila 2013). As most the competitors offer similar products and services to the customers such as
the device sold by Barnes & Noble, iPad introduced by Apple and android introduced by Google

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was similar to Kindle Fire of Amazon. It creates a tough competitive environment for the
company. Moreover, some of the e-commerce companies also offer action services that allow the
customers to auction the prices of the product they want to buy. Thus, it is seen that the e-
commerce industry offers a strong competitive environment to Amazon operating online
business (Castaño-Díez 2017).
Amazon Wal-Mart Apple Sites eBay
0
20
40
60
80
100
120
140
160
180
200
Visitors (million)
Visitors (million)
Figure: Visitors in online website
Source: (U.S. retail websites by visitors | Statista 2017)
The above figure shows the position of Amazon compared to its competitors such as Wal-Mart
and Apple Sites in relation to number of customers visiting the store in a year. Amazon
experienced total customer visit of 183 million visitors, while others received comparatively less
customers.
Internal Analysis

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MARKETING STRATEGY FOR AMAZON KINDLE FIRE
Resources of the Firm
Resources are vital for any industry as it defines the strength of the business over its
competitors. The resources are of two types such as tangible and intangible resources. Among
the two, the intangible resources are the best, as the competitors cannot imitate the services of the
human resource. Amazon too has tangible and intangible resources that help the company to
operate successfully. The company has a financial base of $ 48077 million in the year 2011
which was quite more than its previous years. Moreover, the strongest resource of the company
was its cloud computing information technology and the Simple Storage Service that it offered to
the customers. The stock of the company stood at 468 million in the year 2011which gave it a
strong financial condition and market strength. Other resources are the staffs of the company that
helped them to run the business and the engineers that visits the customers to help them
understand the feature of the new products. It also invented logistic infrastructure and advanced
algorithms for better online experiences (Chen 2017).
Capability identification
Amazon is indulge in offering cloud computing storage technology to the consumers that
are tech savvy and to students that stores hue study materials in the device. Thus, the company
has a competency in researching into new technology and electronic device that can use cloud
storage to prevent data loses (Chen 2017).
Core competency Analysis
Core competencies are technology that the company used in its new tablet the Kindle
Fire. The tablet was introduced by the company in2011 and has used certain features that are rare
and not easy to imitate. Amazon used free cloud storage in the device and the device came
preloaded with the modified version of Google Android OS. The new tablet was a mixture of

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various kinds of technology in one device, which is rarely seen in tablets produced by other
brands. The new Kindle Fire offered by Amazon has everything a customer would love such as
Amazon web services, instant video screening and others. This was done by Silk, which is its
cloud web browser. In its instant screening the company offered 18 million movies, songs,
magazines and other shows (Chen 2017).
Rare? Valuable? Costly to
imitate?
Non-
substitutable?
Cloud Based
resources
Yes Yes Yes Yes
Research in
cloud storage
related areas
Yes Yes Yes Yes
Table: Core Competency of Amazon Kindle Fire
Source: (Chen 2017)
Value Chain Analysis
The value chain analysis shows the activities done by the company to maintain its
business structure.
Inbound Logistic
The inbound logistic of Amazon is its cloud computing system, business algorithms that are used
by the company to produce its electronic device for the customers. Other inbound logistic is the