Comprehensive SWOT Analysis of Amazon Business Strategies

This report provides a SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of Amazon, the leading e-commerce and cloud computing company. The analysis identifies Amazon's key strengths, including its market leadership, strong financial position, customer loyalty, and innovat...Read More

SWOT Analysis Amazon

TABLE OF CONTENTS
SWOT ANALYSIS OF AMAZON.............................................................................................1
REFERENCES................................................................................................................................4

SWOT ANALYSIS OF AMAZON
Amazon is the leading e-commerce brand of the world and also directing cloud player.
Company invests huge sum in research and development within growth of e-commerce industry
for giving superior experience with their customers (Vieira and et.al., 2018). As shopping
destinations, Amazon is very popular. In order to analyse the strength and weakness of the
selected organisation SWOT analysis is conducted as below:
STRENGTHS:
Amazon is the leading e-commerce brand that is strength of firm. Company has also
major cloud player. Firm has strong global presences and large base of customer loyalty.
Amazon has powerful financial position in terms of revenue that is also key strength. In recent
year, company achieve growth in fast sales. Organization is the favourite destination of customer
from across globe in many collections such as fashion, music and electronic. Amazon's website
has also faster grow in relation to number of third party seller (Odeh, Warwick and Garcia-Perez,
2015). Company always focus on innovation and quality of marketing that helps in increasing
loyalty of consumers. Firm has also utilized prime membership for increasing retention of
consumers. With the help of it, firm has kept driving loyalty and experience of existing as well as
new customer. Firm has adopted leveraging information technology for increasing competitive
advantages. Amazon has also extensive product mix for finding customers’ needs and wants as
well as their experience. There are millions of specific goods available on their e-commerce
platforms(Pruchinski, 2018).
WEAKNESS:
Poor operating margin and product failure are weakness of Amazon. Firm has paid high
shipping costs and limited flexibility in pricing. The business model of company has imitated by
others easily that is also weakness. Firm has limited penetration in developing markets, because
of other organizations became wholly constituted in developing markets. Due to tax avoidance
controversies in UK, it damage to brand image of Amazon (Pratap, 2018). The weakness of
company is seasonal demand of customers. Firm offers free shipping on product to their
consumers that decrease profit margin of business. It is not being able to optimize on costs
because of this concept. Company has less focus on particular product and services margin. Poor
position of Amazon's fire phone has weakness of firm. Sometimes, fast rate of technological
development amid huge competition, so that product are not successful. Firm has also limited
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Brick-mortar presences to attract consumers to particular product types that are sellable in
physical stores instead of online stores. Therefore, firm must have control and overcome
negative impacts of their weakness. They must have control competitive advantages in both
online and offline.
OPPORTUNITY:
Amazon create and develop opportunities by introducing new product, acquiring new
business and diversify new technology. Firm acquire entire food market for faster growth across
the worldwide. Firm has improved profit margin and revenue by increasing range of product. By
determining customer preferences accurately, company merchandise new products. Through
forward integration, organization can accomplish faster growth. Firm also needs to focus on own
brand products and services and raising physical presence of brand. Amazon is developed more
localized sites in global marketplaces (Santopuoli, Marchetti and Giongo, 2016). They are also
engaged in strategic cooperation with organization in e-commerce and affiliated sector. Firm has
adopted penetration marketing in developing markets that move establish presences of business.
Therefore, this give advantage of powerful competitive edge. Firm has chances to open more
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Illustration 1: SWOT Analysis
Source: (SWOT Analysis of Amazon, 2018)

brick -mortar stores to better competition against high retailers. One of issues facing company's
e-commerce website is the constant sale of false units that are normally against expectation of
consumers. Company must have improved technology control and policies of firm to address
imitative sales. Firm has also opportunity to diversify their brand to determine faster
development in industry.
THREATS:
Regulatory framework and high level of competition are threats faced by Amazon in both
retail and cloud company. Company has threatened by many challengers such as Flip cart, Bay
and Microsoft that includes in e-commerce brands and competing cloud firms. They also face
threat in relation to cybercrime and imitation of product and services. Due to less profit margin,
company has loss profitability and revenues of business (Smith, Rupp and Offodile, 2017). Large
retail firms such as Walmart are continuing improve their online presences that is competitive
advantages issue against company. The strength of dollar effects on profits of Amazon globally.
The possible negative impact on profits of company by wave exchange rates of foreign currency.
The core market and accounts of Amazon is based on America in terms of sales. Some reasons
such as hacking and theft that leaves their customer data opened by online shopping which is the
largest threats to company. Therefore, Amazon has to rapidly comfort concern of customers over
its sites and ensure that guaranteed of online privacy and security.
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REFERENCES
Books and Journals
Odeh, M., Warwick, K. and Garcia-Perez, A., 2015. The impacts of cloud computing adoption at
Higher Education Institutions: a SWOT analysis. International Journal of Computer
Applications . 127(4). pp.15-21.
Santopuoli, G., Marchetti, M. and Giongo, M., 2016. Supporting policy decision makers in the
establishment of forest plantations, using SWOT analysis and AHPs analysis. A case
study in Tocantins (Brazil). Land Use Policy. 54. pp.549-558.
Smith, A. D., Rupp, W. T. and Offodile, O. F., 2017. Amazon. com, Inc.: Retailing Giant to
High-Tech Player?.
Vieira, N. M. C. and et.al., 2018. Managing the Technology for Selectively Collecting Solid
Waste in the Western Amazon Sub Region. The Journal of Solid Waste Technology and
Management. 44(1). pp.43-50.
Online
Pratap. A., 2018. Amazon SWOT Analysis. [ONLINE]. Available through: <
<https://www.cheshnotes.com/2018/07/amazon-swot-analysis-2018/>.
Pruchinski. T., 2018. SWOT Analysis of Amazon. [ONLINE]. Available through:
<https://landingcube.com/swot-amazon-competitors-analysis/>.
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