International Strategy - Essay Example

Finally, a crucial element in the decision to go international is the amount of munificence in the domestic industry environment. Entrance into the international markets can be made by exporting directly to the market, making use of possible domestic incentives. . company wants to retain greater control, acquisition of a company or formation of a whole owned subsidiary may be the best option in terms of allowing greater autonomy in decision making. Amazon is a company that enjoyed considerable growth since its inception and enjoys an international market of customers through its online store.

The company now decided to go global with Amazon's DRM-free MP3 digital music store. This is an important decision as it would expose the company to a whole new horizon of opportunities and risks ("Amazon to Begin International Rollout of Amazon MP3 in 2008."). The motive for this expansion seems to be the traditional need to expand beyond the domestic market and tap into that reserve of international customers. However more than that, this seems like an inevitable choice for Amazon given that competitor multinational firms such as Apple with its I-pod and I-tunes store already have an international base and may keep creeping on Amazon's customers.

Apart from being the need of the hour, this expansion will allow the company to enjoy a possibly higher return on investment given the rise in its customer base and increased sales could see quarterly profits rising steadily. The company may also be able to enjoy economies of scale in terms of learning as handling a diverse customer base will allow it to come into contact with and become adept at fulfilling unique customer requirements. This experience the company can use to bring innovation to its operations in the domestic market and other areas of the business, something other competitors in the domestic market may not be able to enjoy.