Strategy Amazon should adopt11
Online Service Quality and Site Design14
Current Online Activity15
Metrics and Analytics17
Unique Visitors / Rank19
Search Marketing Tactics23
Other Marketing Communications24
Amazon is an online retailer that includes a large range of products including everything from electronics to books. Amazon’s website (http://www.amazon.com) was launched in 1995 and was created to be a destination location for online shoppers. By 2000, Amazon had shipped 20 million products to 150 countries around the world (Amazon Inc., 2010). In 2007 Amazon launched the Kindle, a new product that would change the majority of Amazon’s sales from printed books to virtual books (Amazon Inc., 2010). Visitors to Amazon’s page are greeted with the most popular products, their recent searches, and advertising. Also included on the client’s website are general product categories and a search bar for visitors looking for a specific item. Amazon corporate mission states, “We seek to be Earth’s most customer-centric company for three primary customer sets: consumer customers, seller customers and developer customers” (Amazon investor relations, 2011).
Amazon recently released their figures for the third quarter which ended September 30 of 2011. Their third quarter sales for 2011 were up 44% from 2010 to $10.8 billion (Amazon.com announces, 2011). Although Amazon has been seeing a large increase in sales from 2010, their profits do not match this trend. In the third quarter of 2011, their net income decreased 73% to $63 million (Amazon.com announces, 2011). Amazon attributes this decrease in profits to its free-shipping promotion, foreign exchange rates, and discounted Kindle e-readers (Tsuruoka, 2011). Amazon has also been using its money to expand its online media collection by signing licensing agreements with Twentieth Century Fox and PBS to stream popular movies and shows for Amazon Prime members, and launching a Spanish language website to expand their market (Amazon.com announces, 2011). Although stocks seem to take a plunge after financial data is released, Amazon continues to see huge growth in sales and expand its product lineup and markets. These actions quickly resume investor confidence and allow Amazon to continue its overall expansion. Amazon’s annual financial data can be seen in the below table. Financial Data|
| 2010| 2009| 2008| 2007|
Revenues (in millions)| $34,208| $24,509| $19,166| $14,835| Net Income (in millions)| $1,152| $902| $645| $476|
(Amazon stock reports, 2011)
Amazon’s strategies continue to make it an industry leader for many reasons. It continues to purchase smaller online retailers, such as Shopbop.com and Zappos.com, to increase the amount of products that are offered to visitors (Young, 2011). Amazon partners with companies like LivingSocial to launch its new products and services like AmazonLocal, which gives amazing deals on local services (Young, 2011). Amazon continues to offer the best prices to keep customers buying online instead of in the stores. On average Amazon is 6% cheaper than Wal-Mart and 9% cheaper than Best-Buy (Cendrowski, 2011). Customer service is also a main priority for Amazon. According to a survey from the National Retail Federation, Amazon's customer service ranked higher than any other retailer (Cendrowski, 2011). Amazon continues to grow its electronic media environment to new...