Market Audit Plan of Amazon - Case Study Example

Market Audit Plan of Amazon Executive Summary Amazon.com has a foremost edge in the world of e-commerce. It has a tough competitive benefit. Conversely, like many online retailers, certain characteristics of doing business online create difficulties and need of marketing planning. This marketing plan comprises of environmental scan, current segment of the market, marketing strategies, customer behavioral patterns and recommendations in strategies. Introduction Amazon.com is a major online retailer. Jeff Bezos opened the virtual doors of this online retailer in July 1995 in Seattle. From then onwards it has had the benefit of rapid expansion in every part of its operations that includes business turnovers and a amazing rise in value of its share since the public floatation in the year 1997. Amazon.com sells is fundamentally an information broker and sells on-line only. It has an on growing database which is over 12 million consumers in over 160 countries. Amazon.com is a place where customers can find and discover everything they want to purchase online. It has the earth's largest collection of products that include millions of complimentary electronic greeting cards, books, online auctions, toys, videos, DVDs, CDs, games, kitchenware, electronics, computers, and much more. Purpose of the Audit Amazon.com is the world’s largest international online retail store. It has a very strong in house internet technology and also an excellent offline customer services. It has a massive database of loyal consumers which is over 12 million buyers. The company has become a huge online superstore that recently recorded sales of $1.64 billion in the year 1999 which is a raise of 270% that from the last year's sales. Amazon.com holds a very strong position in media industry. Amazon.com uses the Internet service to convert the book buying experience into the easiest, most enjoyable and fastest shopping possible. There are four important aims of Amazon.com 1) Improve consumer relationships Amazon.com continues to invest profoundly in building a relationship with new consumers. Customer fascination is a main focus at Amazon. In fact there is nothing to worry if the rivals pay attention to Amazon and Amazon focuses on the customer. There are 3 major factors that really matter to the customers: selection, price and ease of entry. Amazon.com has made sure that it is the best retailer in these three areas. 2) Expansion of products and services. Amazon.com plans to expand its product and service as its important as it not only encourages customers to comeback, but as a company it has also created a well known retailer with a wider consumer database. Till the time customer keep coming back in order to buy new kinds of commodities, Amazon.com is sure to make money. 3) Expansion of partnerships. The partnership venture of Amazon.com has been very successful in the last few years. The company hopes to work on the same pace and gain that success. The partnerships like gear.com, drugstore.com, and ashford.com, offer a wide range of selection and excellent customer service, similar to Amazon. Successful partnerships has proven to be greatly beneficial and helped enhance the business. 4) Profitability in all Amazon.com business. Substantial profit is an important aim for all company. Presently, Amazon.com generates revenue which is re-invested in the company. The aim is to constantly reinvest and generate profit in every business sectors. Its time to cut any fixed costs, and thus improve company’s expenditure. There are various factors like quality of merchandise, delivery costs and service provided that needs to be considered. Only after that evaluation of all these three factors, Amazon can establish the highest value and the lowest cost supplier. Amazon.com has various marketing objectives. A few are to achieve a 200 percent hike in sales every year for the books. To achieve a 250 percent hike in sales of music every year. To achieve a 275 percent hike in sales for movies per year. To achieve a 100 percent hike in sales of software and electronics per year. These percentage hike in sales for the categories above are determined by every category’s necessitate strength minus the present strength of that particular product line which is then divided by the nos of years that is left on the particular loan. This is the derived percent increase required every year for that specific product line in order to generate enough profit in order to pay off the loan. Findings SWOT Analysis done on the company provides these results. Strengths – Amazon provides excellent customer service. The function of one-click service gives the customers a sense of propinquity while ordering products online and also satisfies them cause of the enhanced electronic confirmations service. Fast foyer to product supplied. The moment the customer finds a particular product and clicks the order key. The order data would be transferred immediately to any one of the Amazon servers. It then informs the member of staff to take and pack the product as per the customer's needs and desire. International recognition. Any person who wants to buy a book through the internet, first visit Amazon because it is highly recognized and famous. Amazon also uses referrals and online advertisements from their buyers in order to update people of the services that it offers. It also provides a convenient and safe shopping service to all the buyers as credit cards transactions reduce the risk of lose or theft of cash. Customers can also avoid exchange of currency. Weaknesses – The waiting for the delivery of a product ordered is Amazon.com’s weakness. Even though the product offered is shipped right away. The customers are not able to have the product instantly as they would most. Uncontrollable operation: Due to the operational policy Amazon.com lost money. Bad investments: Investment in unsuccessful wireless technology venture and other not successful ecommerce ventures has not only made Amazon.com lose money but also harmed the operations of the company. Opportunities – Increase in Internet markets: There is a rapid increase in the Internet users thus creating a large group of buyers who shop online. Innovative technology: The web Services of Amazon.com harnessed the enormous product information is already accessible on the website and converts it into a reserve for developers as users. Presently, around 800,000 sites have also registered in the Associates Program globally. Collaboration with other businesses: Clientele can purchase products from different vendors through Amazon website. They draw new clientele through the links on various sites. Customers can use Amazon services from within the partner websites. Threats - Declining economy: Due to the failed Internet companies the generation of capital for Amazon.com has decrease as it no longer gets low-priced investment from the stock market. Doubtful Internet business trends: Business related risks comprise of amount of competition, indebt, possible operational fluctuating outcome and growth rate, exchange rate of foreign currency and government regulation. Competition with purveyors: purveyors selling directly to buyers may make much more profit than via middle men. Hence suppliers may not offer low price to Amazon. Service Interruption: System interruptions due to bad weather, power losses, computer viruses and hardware failure frequently make the Amazon.com site unavailable preventing efficient fulfilling of orders. Hardware problems: Due to hardware failures the Amazon decentralized servers suffer a lot. On occurrence of this, the complete system gets affected bring the services to stall and causing lose of data Recommendations Strengths Weaknesses Opportunities and Threats can be used to help Amazon.com increases the customer service department, improves the performance of the website for handling the Internet devices. Expansion of business relationship internationally, emphasizing security in the field of marketing. Redirecting the investments made in unsuccessful companies to much safer companies, Outsourcing more technology services in order to improve the systems and for cost reduction. Allowing partners more independence can reduce the overhead Threats. Using of new technology in order to coordinate valuable solutions with suppliers. Establishment of a secure system for prevention of any outside interruptions. Use speed and acknowledgment to increase reputation and sales internationally. Establish a improved share of the online business via marketing in order to discourage competition. Boost orders from suppliers. Refrain from investing in e-commerce ventures. Increase of system security. The threat of entry is there with every company. Brand loyalty in such cases plays an important role for the Amazon.com sales. This is a complete cost advantage for Amazon.com. Government policy might have created barriers for establishment of the online retail website Amazon.com viewpoint. This is a moderate threat of entry. Power of purveyors has help Amazon.com to fight its rivals and provide excellent services generating revenue creating it as the number one seller in both retail and online in 1999, thus giving better deals. Conclusion Amazon.com is a publicly owned company that focuses on excellent services and employees. It is a company that is team oriented and organized by product. Amazon.com offers the capability to present a wide range of products. It has an easy and well organized navigation to FAQ and help pages that makes the difference and a better shopping experience. Building of a consumer community helps to maintain clientele returning to the site. It also helps buyers identify the brand. Amazon has constructed a database of millions of loyal customers and thanks to the highly well-organized outstanding customer service and web buying experience. With some scheming interest in well-liked Websites, word of mouth from buyers, gift certificates and the simplicity of communication via e-mail has made Amazon.com one of the popular home shopping sites at present (Amazon). Works Cited Marketing Plan for Amazon.com. 26 Jun 2005. Amazon. 22 Nov 2009 . Read More