Study of Amazon

History of Amazon

Amazon.com was Incorporated in 1994. Sells first book in 1995. Launches its Associates program in 1996. Becomes publically listed company & Introduces 1-Click Shopping in 1997. Amazon Acquires iMBd.com, begins Selling Music, launches Amazon UK and Amazon Germany & begins selling movies in 1998.

Begins Selling Electronics, Toys, and Games & begins selling Software, Video Games and Gifts in 1999. Opens Camera and Photo Store & launches Amazon Marketplace in 2000. Introduces "Look Inside the Book" function in 2001.

Launched the Kindle in 2007. Introduced the Kindle 2 in 2009. Launches 'Price Check by Amazon' in 2010. Launches Amazon App Store for Android, John Locke becomes the first independent million selling author on Kindle & kindle Fire and the Kindle Touch was announced in 2011.

 Challenges that Amazon faced in the early years

Profound challenges have faced Amazon. Profits are stagnating, competition is blooming, and even people who are optimistic about Amazon are concerned about downward pressure on prices. Analysts, while crediting the company with growing from a money-losing electronic bookstore into a proiftable online mall with international reach, caution that the pressure on Amazon's profits shows no sign of letting up.

The major competitor of Amazon is EBay.

These are some other competitors:

Netflix

eMusic

Elastra

Inspire My Design Ltd

P.E.S.T Analysis on Amazon

Political

International policies: In particular countries these may interfere with the expected growth of the company.

Economical

Currency fluctuations: In various countries where currencies are highly devaluated in comparison with the dollar, it may bring additional costs to the company.

Economical tendencies: In most cases, individuals rather buy in their neighbourhood stores, than going online. Customers prefer doing the regular commercial process of going to the store, paying the product and getting it instantly than going online, processing their bank details and waiting for several days to obtain the item.

Social

Ethical and religious factors: In some cultures Internet use is not allowed due to the fact that at some point contents may damage their cultural, ethical and social believes.

Technological

Amazon.com is a company highly involved into the technologically field, and its success has been well achieved over the past six years, although many challenges face Amazon in the fast paced environment of the Internet hence, amazon.com has to face this challenge, finding innovative ways to stay ahead of their competitors.

SWOT Analysis - Strength, Weakness, Threat and Opportunities of Amazon

Strengths

Brand recognition: Amazon.com is very well-known.

The business model

Diversification: Have varied the products they sell

Business evolution: Amazon.com has continually reinvented their services, increasing their value.

Weaknesses

Strategies based on low prices attract more customers.

Growth.

Offering free delivery is expensive.

Opportunities

Pre-ordering: Increasing pre-ordering of products is a great business.

Various providers

Web services

Expand the brand to international markets.

Threats

Competence: The e-commerce field has evolved rapidly and it is highly competitive, companies such as EBay, Wal-Mart and Google are a constant danger to the company.

Inventory: Demand of products is constantly changing.

 Growth Strategies and the future plans for Amazon

Amazon has redefined e-commerce. Amazon makes everyone else look irrelevant, including giants like Walmart. Amazon also re-invented books with the Kindle, and you could argue they re-invented the Internet by introducing all sorts of cloud computing and cloud storage services.

Amazon brought in $57 billion in sales with operating income of $531 million.

Amazon’s profit margin is next to zero, and seemingly has way more upside (as they scale) compared to Apple. After all, Apple could face pressure from the onslaught of Android devices and from Amazon’s own Kindle Fire platform.

It is in their interests to quietly destroy the profitability of mobile computing hardware, harming their competitors (such as Apple) while building up their profits where others have a hard time competing.

Amazon.com has innovated along the years reaching highest levels of customer satisfaction which can assure their position into the market for future years.