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Amazon Marketing Strategy

MBA Marketing Assignment

Research Paper (undergraduate) 2008 17 Pages

Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media

Excerpt

Table of Contents

Executive Summary

List of Figures

Objectives

1 Introduction

2 Amazons Marketing Mix
The Product
The Price
The Place
The Promotion

3 Implementation of Amazons Marketing Strategy
3.1 Avoiding hurdles to the customer
3.2 Presence in the internet market
3.3 Offering a wide product range (product categories)
3.4 Offering competitive prices

4 Managing Amazons Marketing Programs

5 Conclusion

Bibliography

Appendix 1 - ITM Checklist (360-degree analysis)

List of Figures

Figure 1 - Product Categories at Amazon

Executive Summary

Founded in Seattle (Washington, USA) by Jeffrey Bezos in 1995, Amazon is now the world leading internet sales platform for consumer goods. Offering books in the first place Amazon now offers products in more than 40 different product categories.

Omnipresent everywhere in the internet Amazon claims to be “the world's most customer-centric” company. Indeed Amazon is doing everything to achieve this goal through continuous service-improvement. Whenever a new service will be launched customers expectations always define the key features.

But what an internet company would Amazon be if this customer centric mission wouldn’t be promoted and capitalised. Grown up with the internet and familiar with all its marketing instruments, Amazon uses every opportunity to promote its brand and the offered services.

Beside the user-experience Amazons success depends on its propagation and accessibility. Amazon manages this by sophisticated partner programs to grow fast and continuously. In consequence of the market power Amazon has, the prices for goods are more than competitive in the internet.

Since the internet still hasn’t reached its maximum capacity and far not everybody - especially elder generations - uses the internet for daily shopping, Amazons growth will continue and further customer-centric services will follow as long as the vision keeps alive. Objectives The objective of this assignment is to analyse how Amazon has implemented its vision “to be the earth’s most customer centric company” and what the marketing strategy and tools are to convince consumer customers to buy at amazon.com.

1 Introduction

The amazon.com website was launched on July 16th 1995. From the early beginning in 1994 Jeffrey Bezos, the founder of amazon.com was inspired by the idea to revolutionize the book business by creating an online store for books with the best conceivable customer service. Initially been laughed at, Jeffrey Bezos adhered to the idea and set up the world most popular internet bookstore. (Spector, 2003, pp. 33-45)

One major root for the success story of amazon.com is certainly the involvement of Jeffrey Bezos in the technical foundation of amazon.com, since the customer experience of an online portal is fundamentally defined by its technical implementation. From the early beginning Bezos and his founder colleagues where driven by the question „What if...?“ The question that, consequently answered, leads to the way to implement a user- friendly portal as amazon.com it is. (Spector 2003, pp. 56-60).

Today Amazon is the global leader in e-commerce and disposes of international sites, and worldwide network of fulfilment and customer service centres. Amazon.com offers everything from books and electronics to tennis rackets and diamond jewellery and operates sites in the United Kingdom, Germany, France, Japan, Canada, and China and maintains over 25 fulfilment centres around the world. (About Amazon)

2 Amazons Marketing Mix

Before going into the details of Amazons marketing implementation it must be considered what exactly Amazon offers to get the right focus for the further analysis. For this purpose the Marketing Mix and its four components shall be outlined shortly.

The Product

Since Amazon is a service provider in the proper meaning, the products Amazon sells are not the offered consumer goods itself. The products or better the services Amazon offers are:

- portal-usage on amazon.com and other domains (for consumer customer and seller customer)
- information (transparency) of the goods offered (via the portal)
- payment terms
- delivery service of goods
- after sales service

Nevertheless, the consumer goods offered on the portal have to be seen as products in Amazons responsibility and must be kept in mind as well.

The Price

Following the product description above it seems not far to analyse the prices of those services. But since the customer does not directly pay anything to the used services1, even if he realises the service at all, the price for the good to be sold must be considered in this case.

The Place

Amazon offers the above mentioned consumer goods supported by the described services primarily via its portal on amazon.com and further domains. The place in the meaning of “where does the customer get the products and services” is the virtual store in the internet.

The questions where the product originally comes from and where the logistics are done usually don’t concern the customer as long as he can get the product in the expected price-range in an acceptable timeframe.

The Promotion

Offering services via internet usefully comes along with internet marketing since the target customers can primarily be found in the internet already.

Internet marketing by Amazon mainly bets on the fact that the internet is a medium to transfer information per definition. Word-by-mouth recommendation via mail, banner-advertising, e-mail campaigns and further common internet marketing methods are used.

3 Implementation of Amazons Marketing Strategy

Amazon as one of the mid-90’s internet pioneers was involved in the definition of internet and also driven and modelled through the new possibilities of electronic (IP-based) communication coming up that time.

In the early beginning of the internet and in the first years after the launch of amazon.com new interesting and amazing websites where spread by famous websites like Yahoo and Netscape. Recommendations by those established websites led to enormous traffic on the recommended websites. Amazon profited by those recommendations and had a lot to do to fulfil its aspiration to be consumer centric. But even though the expected demand was multiply exceeded, Amazon took the chance to adapt its competencies synchrony to the evolution of the Web until the present day. (Spector 2003, pp. 64-78, 84-125)

Hence after more than 13 years of successful internet business Amazon has all possibilities and experiences to take advantage of all conceivable internet-marketing possibilities to capitalize the Amazon-brand and Bezos’ Vision of being earth’s most customer centric company.

[...]


1 In this context Amazons customers are the consumer customers not the seller customers. They have to pay commissions for products sold on the Amazon platform.

Details

Pages
17
Year
2008
ISBN (eBook)
9783640779918
ISBN (Book)
9783640780693
File size
1 MB
Language
English
Catalog Number
v162454
Institution / College
University of applied sciences, Munich
Grade
Tags
Marketing Assignment Amazon Strategy MBA Integral Total Management ITM

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Title: Amazon Marketing Strategy