Assignment 2Situation Analysis
Company/Brand Selected: Amazon
Whoare the current customers/users? Include information related todemographics, psychographics and buying behavior, price sensitivity,customer satisfaction and loyalty.
Amazonis a retail and web service provider globally. It appeals to bothcultural and social groups in various ways. The brand promotesresult-oriented culture towards their customers. Amazon customers arediverse in nature as evident by the range of products offered by thecompany. Some products are men, women and children oriented. Examplesof different products include auto, beauty, health and kids products(Amazon, nd). The customers are from various geographical areas dueto its online environment. People who use the Amazon are trendy inthat their needs and preferences changes over time. Although thecompany is known for its sale of books, it has diversified itsoperations. College students who buy books have the ability toacquire e-readers from the platform. Amazon offers all sought ofproducts that aim to meet the needs of sports fanatics, single moms,retirees and new parents in the market through their separate retailwebsites.
Whatdo the customers buy/use?
Thecustomers on the platform buy products depending on their needs andwants. Video gamers can buy video games, students buy books andAmazon Kindle e-readers, while other customers may buy electronics,food, jewelry and clothes (Amazon, nd).
Whatchanges can the company/brand expect in the future? How can thecompany/brand better serve its customers? Include information aboutpotential opportunities and threats.
Withthe continued increase in e-commerce, Amazon has a tremendouspotential to grow its sales and customer base in the market. However,the emergence of other competing retailing websites like e-bay posesa significant threat to its initiatives. Amazon future strategicinitiatives are to tap the online publishers on their platforms byestablishing a publishing platform known as Kindle Scout (Amazon,nd). Through the platform, Amazon can partner with various authorsacross the globe. The company has also taken advantage of expandingits operations in Mexico. It has launched a website in the Spanishlanguage that offers a broad range of goods and services at lowprices.
[Thisis what the brand is currently.]Identify strengths andweaknesses of the company/brand as it exists today. What does thecompany/brand do well and not so well at this very moment?
Thestrengths of the company include a strong operational network andbusiness model. It can cater for a large customer base through itsmassive fulfillment centers. Amazon emphasizes on price, selection,and distribution when clients are choosing their products andservices (Amazon, nd). The company also offers bundled services toconsumers such that there is the creation of greater efficiency andlow prices. It has also diversified from e-commerce to cloudcomputing industry.
Theweakness of the company comprises of declined financial performanceand operational issues. The drop in the performance was brought bythe increase in interest expenses, marketing, and fulfillment costs.Amazon lawsuits from other stakeholders in the industry contribute tooperational issues. These problems usually drain the financialresources of the company in the long run.
[Thisis what the company/brand needs to become.] How can thecompany/brand improve its weaknesses and maintain or grow itsstrengths? Suggest how the company/brand can improve upon the thingsit does well and not so well.
Amazonshould avoid involving itself in operational issues by establishing ateam of professional and management that can oversee innovations fromtheir employees. These help in prevention of patent and copyrightinfringement. Amazon can improve their strengths through strategicacquisitions. The acquisitions form a part of growth approach andhelp in supplementing other business activities in the company.
Definethe current business environment. Include information aboutpolitical, legal, economic technological and societal factors thatmay influence sales.
AlthoughAmazon is a global brand, it faces exposure to foreign exchangerisks. The risks arise from the fact that the transactions are donein different currencies like Dollar, Pounds, and Yen. These pose asignificant threat to the sales because of weak exchange rates forthe US dollar against all the other main currencies. Online shoppingincreases sales since most customers prefer placing their ordersthrough effective payment methods like credit cards compared totraveling and queues (Amazon, nd). The emergence of other companieslike e-bay who produce the same and new products poses a threat tosales. The new laws that affect Amazon are related to copyrights,taxation, electronic waste and online payment methods. The lawscreate administrative burden on the product and services provided bythe company.
Definethe business partnerships. Does the company/brand have any currentpartnerships? What other company/brand may be a good partner forthem?
Amazoncollaborators comprises of suppliers, distributors and alliances.Currently, the collaborators include authors, musicians, filmmakerswho sell and publish content on the platform. Walmart may be a goodpartner for Amazon since it is one of the leading competitors(Amazon, nd). It would also create an offline channel for Amazonloyal customers.
Whoare the main competitors?
Themain competitors include Yahoo, Alibaba, Walmart, Netflix, e-bay,Books-A-Million and ValueVision Media.
Basedupon the analysis you just completed in this worksheet, what arethree (3) key recommendations that you could pass along to Managementregarding the future direction of the company you selected?
1.[Amazon should continue to expand its digital products andelectronics. Improve on innovation on products that appeal tocustomers like the establishment of more sophisticated e-readers.]
2.[Amazon should establish a team that approves innovations before theyare released into the market. This will help in reducing lawsuitsrelated to patents and copyrights. ]
3.[Since customers forms the foundation of the company, it shouldestablish channels that offer direct responses to customer queriesregarding the products and services offered on the platform. Thisimproves the retention of customers.]
Amazon,. Amazon.com: Online Shopping for Electronics, Apparel,Computers, Books, DVDs & more. Amazon.com. Retrieved12 August 2016, from http://www.amazon.com
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MKT 100Assignment 21156 (8-14-2015) Page 3 of 3