Amazon

Posted by Candle Walsh on January 21st, 2021

Amazon.com, Inc. is one of the largest worlds companies on the basis of turnover of goods and services sold through the Internet. In fact, it is one of the first Internet-based services targeted to sell real mass consumption goods.

Amazon.com was founded in 1994 by the U.S. entrepreneur Jeff Bezos. In 1995, the companys site was launched. The company was named after the Amazon River, which is the deepest river in the world. Initially the site was selling just books. However, in June 1998, the store began selling music CDs. In November of the same year the company started selling video production. Later, the range became wider and it included MP3 recording software, video games, electronics, clothing, furniture, food and toys. In fact, the original strategy of Amazon.com was based on the long-term perspective, while the founder of online store knew how profitable the project would be to him. It should be mentioned that many IT-companies grew in those years very quickly along with Amazon.com. The press was full of the eloquent reviews of the Bezoss creature. Some people were convinced that Amazon.com would fall as quickly as it rose, while others trusted the founder of the company. There was not a common opinion on Jeffrey Bezoss draft .

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Let us have a closer look at the history of the companys establishment and development in order to analyze the key strategies Jeff Bezos used to grow the company in just 17 years. In fact, strategy of Amazon.com has not changed for the last 17 years. The customers need three things, i.e. the wide range of products, the lowest prices and the most convenient delivery. All actions of the company are made on the basis of these fundamental principles.

So how Amazon.com has managed to become the largest Internet-shop in the world? This is caused by the following key elements of its strategy:

1.Customer focus. Amazon.com improves constantly. The company is obsessed by its customers. Amazon.com was one of the first bookselling stores that applied practice of customer reviews on the products from a range of companys products. Despite the fact that at the very beginning the producers themselves were against the introduction of such function on the site, in the end it became beneficial as reviews on the products increased the number of sales.

2. Diversification. In addition to books, Amazon.com sells other products and categories. For example, in the assortment of online stores were included the following goods: consumer electronics, movies on DVD and CD drives, digital music, etc. However, the most interesting fact is that people still associate this shop, first of all, only with books.

3. Personnel policy. The company believes that success can be achieved only by small groups. That is why Amazon.com does not have particularly complex vertical hierarchy in the management. Everything is built on the work of small groups. In selection of the personnel the company carefully considers each candidate. It wants only the best people.

4. Marketing. Success was also influenced by the affiliate program, through which the companys customers had the opportunity to promote their own products from the range of Amazon.com and receive their profits from sales.

5. Long-term perspective. The company was always focused on the long-term perspective while setting its goals and objectives.

6. Focus on a wide range of consumers. Consumers cannot only buy products such as books, but also resell them through the Internet inviting other users. They are on an equal footing with the marketing of the company.

7. Informativeness. The companys customers are given the opportunity to negotiate the necessary information regarding purchase of any product, whether it be books, CDs, or any other commodities. Consumers are also informed about the conditions of delivery, timing and price, and can even send the list of products belonging to this category of products.

It also should be mentioned that at the beginning of his career in the world of e-commerce Olympus, Jeffrey Bezos was focused on the efficient branding of his company. In the early years, due to the lack of real competition, the owner of Amazon.com sought to consolidate and increase the companys brand recognition. The next stage of the marketing campaign was to work on such a fundamental parameter as loyalty to the brand. That allowed obtaining the repetitive and permanent consumers.

Amazon logistics is based on the following principles

-Understanding of the customers needs. The first business plan demonstrated deep understanding of what customers need from the network store. Nowadays, Amazon.com still continues to collect information about their customers wants and needs making researches through questionnaires, forums, newsgroups, etc.

-Trust to the friendly relations with the clients. Each contact with the customer is a turning point in the relationship with him or her. This statement applies to all employees of Amazon.com.

-The adherence of logistics to the general market strategy. For example, the decision to arrange a warehouse in Delaware and Nevada (near the border with California) was designed to reduce sales taxes. The domestic transportation and distribution of goods is also supposed to be the issue of great importance.

-Positive image. There is a huge number of different wholesalers and the third-party vendors, but many users still turn to Amazon.com to order a book or other purchases via the Web. It means that the company is trusted by the consumers.

The abovementioned principles are supposed to be the key factors that formed the companys strategy and led Amazon.com to the success.