Case Study on Amazon

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Case Study MG495

TO: Jeff Bezos, Founder & CEO, Amazon.com
DATE: 04/06/08
SUBJECT: Amazon.com Analysis
EXECUTIVE SUMMARY

Amazon.com was founded as an online bookstore in July, 1995 and went public in May 1997. In June, 1998 Amazon.com launched its music store. Since then Amazon.com has become the most prominent Internet retailer. Over time Amazon.com has added several products including electronics, health and beauty products, house wares, kitchenware’s, music, tools, toys, videos, and several services such as auctions, 1-Click ordering, and zShops. Amazon.com has expanded nationally and internationally and now operates several customer service and distribution centers in the United States and international web sites that serve customers around the world. One problem that founder and CEO, Bezos faced, was how to turn Amazon.com into a consistent moneymaker in the immediate, intermediate, and long-term time frames, while also continuing to pursue the corporate objective of expansion at reasonable costs.

In order to overcome the hurdles currently facing Amazon.com, I offer the following recommendations:

1. Develop and implement a B2B exchange for supplier’s manufacturers, distributors, and retailers to use.

2. Amazon should expand its online auctions.

3. Develop an effective differentiating enterprise wide strategy to survive and prosper over the competition for the long-term future.

4. Amazon should use a web-based model to personalize service.

5. Increase advertisement to have brand awareness.

I. The Company’s Current Objectives and Current Strategy

The company’s oft-stated goal is sacrificing short-term profits for building long-term growth, market share, and increased shareholder value. Amazon’s internal goals were to focus on increased market share, expand product offerings, and overall sales growth. Promotional activities, including promotional alliances and advertising, were important



References: Wheelen, Thomas, and J. David Hunger. Strategic Management and Business Policy. 11. New Jersey: Pearson Prentice Hall, 2008. p13-1, 83-86, 229.

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