Hide Notes 

Slide 1: Case Analysis Wanda Martin Cito Pellegra Jeremy Stafford Ashley Sullivan Catrina Taylor
Slide 2: Amazon.com Origins  Jeff Bezos founded 1994 Website first launched in 1995 HQ Seattle, WA NASDAQ AMZN IPO issued in 1997 at US$18.00 per share    
Slide 3: Mission Our vision is to be the world's most customer-centric company; To build a place where people can come to find and discover anything they might want to buy online.
Slide 4: Amazon.com Culture Beliefs The Amazon way: Project an image of fun; but inside, hire smart, drive fast, and above all, bet on the numbers. Relentlessly focus on customer experience by offering customers low prices, convenience, and a wide selection of merchandise. Expectations To be the most complete online retailer Sell everything to everyone, every book in every language Values Customer satisfaction Customer empowerment Efficiency Innovation
Slide 5: Executive Officers Jeffrey P. Bezos - President, CEO, Chairman of the Board Thomas J. Szkutak - Sr. VP, CFO Shelley L. Reynolds - VP Worldwide Controller, CAO L. Michelle Wilson - Sr. VP General Counsel, Secretary Sebastian J. Gunningham - Divisional Sr. VP Seller Services H. Brian Valentine - Divisional Sr. VP E-Commerce Platform Marc A. Onetto - Divisional Sr. VP Worldwide Operations Andrew R. Jassy - Divisional Sr. VP Amazon Web Services Jeffrey M. Blackburn - Divisional Sr. VP Business Development Steven Kessel - Divisional Sr. VP Worldwide Digital Media Diego Piacentini - Divisional Sr. VP International Retail Jeffrey A. Wilke - Divisional Sr. VP North America Retail
Slide 6: PPE Locations 12 Software Development Centers worldwide [2] North America Seattle, WA / Tempe, AZ [4] Europe Slough, UK / Edinburgh, UK / Dublin, IE / Iaşi, RO [5] Asia Bangalore, IN / Chennai, IN / Hyderabad, IN / Tokyo (Shibuya), JP / Beijing, CN [1] Africa Cape Town, SA 31 Warehousing and Fulfillment Centers worldwide [19] North America United States / Canada (3 US sites are planned to close soon) [8] Europe England / Scotland / Wales / France / Germany [4] Asia Japan / China
Slide 7: Technological Assets Efficiency model warehouses - high-tech and completely computerized Acquisitions - IMDb, Mobipocket, Junglee, AbeBooks, CDNow Patents and in-house developments - A9.com, Kindle, One-Click, affiliate program
Slide 8: Amazon.com Relationships Human Resources - 20,500 employees (as of 2008) Partnerships / Affiliations - Target, Toys'R'Us, Office Depot, Circuit City, NBA, WNBA - Bebe Stores, Timex Corporation, Lacoste - Google, Shop@AOL
Slide 9: Skills and Capabilities Marketing - Amazon.com logo (arrow pointing from A to Z, smile) - Automated recommendations listing for every product searched Technology - distribution centers' pick-to-light system, radio-frequency technology, and voice technology - in-house distribution Human resources - product reviews by staff, professionals, and customers - in-house programmers/coders developed WMS SW (warehouse management system software) - former Wal-mart executive hired to develop a world-class logistics operation
Slide 10: Core Competencies Easy-to-use functionality - 1-Click technology Fast and reliable fulfillment - efficient warehousing and distribution model Timely customer service Feature-rich content - sampling (Look Inside the Book, Listen (to music) - editorial and customer reviews - manufacturer and product information - customization (recommendations, email notifications, wishlists, customer accounts) Secure transaction environment - secure payment systems
Slide 11: Business Models Amazon.com can be associated with any of the following business models: - virtual marketplace brokerage model - virtual merchant model - banner exchange affiliate model - pay-per-click affiliate model - revenue sharing affiliate model - open-source community model - open content community model - online fixed price business model
Slide 12: Value Chain Analysis Inbound logistics - virtual supply system eliminates physical brick&mortar links in the retail network - employed BNSF Logistics' supply chain logistics solution (cross docking expertise) Operations - high-tech efficient warehousing models Outbound logistics - developed distribution in-house - optimum distribution network determined by Supply Chain Strategist software from i2 Technologies - outsource some deliveries to UPS and USPS Marketing and sales - online advertising techniques Service - secure shopping experience - product review and recommendation - reverse logistics
Slide 13: Strategic Marketing Segmentation/Position – online mall Products BMVD, ETK, Apparel, Toys Amazon brand products and services (AWS, Kindle, DRM-free MP3) Place orders can be placed anywhere internet service is available - Amazon websites in US, CA, UK, FR, JP, CN Promotion 1-Click service, Amazon Prime, free shipping, affiliate program Price low cost options - new and used items listed together - latest and previous versions/models listed together
Slide 14: Strategic Marketing Growth stage must expand the product line and enhance the customer's web experience to continue growing Brand and reputation - high level of customer service - user-friendly website - vast/expansive product selection - competitive pricing - customer confidence in security
Slide 15: Societal Environment Amazon accommodations - Amazon's low-cost initiatives accommodate customers affected by the slowing economies - Virtual business model and innovation initiatives accommodate Amazon's capabilities of applying future IT developments personalization and mass customization trend increasing environmental awareness changing pace and location of life network security for shopping
Slide 16: Societal Environment Amazon's controversies - Amazon.com v. Amazon Bookstore Cooperative, trademark infringement - 1-Click patent, competitive hindrance - violation of Canadian legal restrictions on foreign owned booksellers - opposition of efforts by trade unions to organize in the US and UK - Humane Society v. Amazon - Nazi t-shirts and Hitler Youth Knives - Antitrust Law violation by Amazon's BookSurge POD company - “glitch” blamed for de-ranking of LGBT books and other “adult” material - banned customers for receiving “too many refunds”
Slide 17: Task Environment Industry - fragmented global industry - analyzer strategic type Competition - Amazon's name recognition hinders new market entrants, in spite of the ease of setting up a web based operation - Amazon's unprecedented affiliate program eliminates some of the effects of would-be competition by large retailers (i.e. Target.com) 3 Customer sets - customers - seller customers - developer customers
Slide 18: Financials a
Slide 19: Fundamental Objectives Market share growth Overall sales increase Product line expansion
Slide 20: Corporate Strategy Growth strategy - expansion of in-house distribution - acquisition of an established distribution/logistics entity - set up Amazon in more countries/languages (i.e. Russia, Spain, Brazil, Korea) - concentric diversification into related fields (i.e. Amazon Web Services, Kindle) Portfolio - q-marks : Amazon MP3, Amazon Web Services, Kindle - stars : affiliates' product lines (BVMD, ETK, apparel, toys) - dogs : zShops, Amazon auctions Parenting - distribution/logistics experts - programming/web application experts - data mining experts - product line affiliate partnerships
Slide 21: Business Strategy Cost leadership strategy - differentiates itself from competitors by means of affiliates program, 1-Click technology, etc. - strategic roll-up potential to consolidate the industry Industry pioneer - set the standard for e-commerce retail - locked in customer base, high market share Cooperative Strategy Strategic alliances with affiliates and logistics/distribution experts - co-opetition?
Slide 22: Functional Strategy Marketing Strategy - market development, web based retailer reaches many customers - product development, i.e. Kindle, Amazon Web Service - penetration pricing, pioneer can gain market share and dominate the industry R&D Strategy - technological leader (i.e. 1-Click, Kindle) - open innovation (i.e. open source business model) Operations Strategy - multiple sourcing with JIT concept Logistics Strategy - BNSF Logistics' supply chain solution (cross docking method) IT Strategy - comprehensively web-based customer experience
Slide 23: Given Alternatives Online Auctions - to compete against rivals in variable pricing online retail - would expand product line to rarities, collectibles, and discontinued items - difficulty in gaining market share from eBay and Yahoo!Auctions - failed attempt in 1999 led to abandonment of Amazon Auctions B2B Exchange - current customer base consisting primarily of individuals can be expanded to include large entities - more intense customer service necessary - difficulty in keeping accurate logistical tracking of the larger industrial shipments without consorting with logistics companies (i.e. FedEx, UPS) - currently in process of achieving this alternative