Amazon achieved its enormous success through the first mover advantage into online retailing, the business level strategy supported by corporate level strategy and their CEO, Jeff Bezos.
First mover advantage in the hi-tech world can present a tremendous entry barrier for competitors. That is the reason why some tech giants are able to sustain their competitive advantage for a long time. Amazon is an example of a company that used their first mover advantage to gain lots of free national publicity for being the first large online retailer. First mover advantage is also the reason why Amazon failed at capturing the lead position in general web searches and online auctions. The large popularity of existing competitors like Google and eBay is insurmountable for late entrants, even Amazon. Amazon built its distinctive competencies in IT, online retailing, and order fulfillment by pursuing a focused cost leadership strategy in online retail industry by focusing on books. This business strategy allowed Amazon to become very effective at providing their customers easy access to over 1.5 million low-priced books and fulfilling the orders very quickly. Amazon took a large amount of market share away from established book retailers by using disruptive technology of the Internet to become a cost leader in the industry. As Amazon developed their competency in online book retailing, IT and order fulfillment, they were able to transfer those competencies to other online retail industries and shifted their business strategy to cost leadership in the e-commerce industry. Amazon supplemented their business level strategy with an effective corporate level strategy of horizontal integration and related diversification through transfer and leverage of distinctive competencies and utilizing general organizational competencies. Amazon established wholly owned subsidiaries in other countries to strengthen their product offerings as well as distribution capabilities by...
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