Running head: AMAZON CASE ANALYSIS 1
AMAZON CASE ANALYSIS
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AMAZON CASE ANALYSIS 2
Amazon Case Analysis
Amazon is a vast online based retailer of books, electronics, toys, music, movies, and
household items. Amazon has established its relevance and need to ensure customer satisfaction
with its fast and convenient shipping means. The online giant store has millions of customers
globally. Amazon also offers web services via its Amazon Web Services, eBook services
through its successful Kindle, and entertainment services via Amazon prime. Amazon has grown
too fast become a gigantic internet enterprise of its own since its incorporation in the year
nineteen ninety-four by Jeff Bezos. Consequently, its fast growth rate has come with several
challenges even though its CEO handles them head-on.
Amazon faces several challenges, most of which are due to its size and fast growth rate.
Below are some of the problems Amazon faces. Growth concerns- the tech company has grown
to be so big that some financial analysts claim it is about to fall. This came after the online
enterprise missed the profit expectations of the analysts. Third-party sellers have often shaken
Amazon because, in most cases, they sell the same products of similar quality at better prices.
These third parties have created a stiff competition environment hence hindering Amazon from
reaching its potential levels (Mudambi & Schuff,2010). Its highly developed and highly utilized
AWS cloud-based platform has been facing stiff competition from other upcoming cloud
services providers.
Question One
The CEO of Amazon had proven over the previous years to be a systematic and intuitive
thinker when it came to solving problems affecting his company. Bezos knows and recognizes
AMAZON CASE ANALYSIS 3
that leadership is not that easy; one must have what it takes. He argues that management
problems and decisions can not only be made based on facts but also should allow instincts. In
the past years, the intuitive leader has been seen making spontaneous judgments by doing what
his instincts tell him and believing is right. He balances his intuition by backing it up with a
robust analysis of the situation at hand by being rational and unbiased instincts. Not more than
once has Amazon lost a lot of money in the sale of its tech gadgets. But this situation has never
put Bezos down. He has mastered ways of managing the situation and taking it positively.
Through its continuous innovations, Amazon is able to introduce new products into the
respective market. This has prevented Amazon from being a stagnant company, thus its growth.
He has transformed Amazon into a gigantic online enterprise that is making full use of
supply chain innovations (Amazon,2017). Jeff does not believe in having a single product in the
market; the tech company has diversified its revenue hence not depending fully on the amazon
sale of goods. Amazon may break even but can recoup the money from the sale of its numerous
products and the amazon prime membership fees paid. This is because more and more people are
adopting streaming rather than having movies in hard copies. Bezos has proved to be a
systematic thinker due to the way he plans. Products to be introduced into the market by
undergoing careful planning and evaluation to weigh their viability in the stiffly competitive
market.
Bezos knows and believes customer satisfaction comes first before anything. He does not
put money in front before consumer satisfaction.
He sometimes lowers the prices of Amazon products to ensure his potential customers are
happy and satisfied. By doing this, his company makes money by raising its margin. Therefore,
intuitive and systematic decision-making both ensure effective management.
AMAZON CASE ANALYSIS 4
Question Two
Amazon has not taken a clear lead in the streaming business even though there has been
an increase in the current adoption of many people. The online gigantic has not been able to
achieve this because it has not well established its streaming services as its competitors have.
Streaming service providers like Netflix, Apple, and Hulu have a well-established business
structure. Netflix is the most popular and most widely used streaming service provider both in
the United States and international boundaries. It is loved for its original programs, which have
kept it ahead in the competitive market (Chiles & Dau,2005). Hulu and Apple are also among the
streaming service providers who are fighting for the pierce of pie in the market.
On the other hand, Amazon prime video, which is one of the inventions of Jeff Bezos, is
a more straightforward internet streaming provider. In terms of pricing, it is relatively cheap. The
benefits of Amazon prime video offer customer content that can be streamed up to a 4K
resolution and in ultra-High-Definition formats if the respective video supports the formats.
However, even Netflix, Hulu, and Apple can also stream content in those resolutions depending
on the package subscribed to. Comparing amazon prime video and Netflix in terms of prices,
amazon is the cheapest of them all. However, both internet streaming providers provide ad-free
content to their customers. Consequently, Amazon is not known for streaming original content;
its biggest competitors, however, produce original movies, series, and documentaries. Taking
amazon’s advantage of being the world-leading internet retailer, it is in a better position of
becoming the world’s number one digital content provider. It can begin by streaming original
content to cope up with Netflix.
Question Three
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One of the latest initiatives of Amazon includes; Prime membership, which has benefits
to those customers who have bought the membership. The holders of prime memberships enjoy
free two-day shipping and free shipping on some eligible products. They also have access to
exclusive deals and get to enjoy early access to deals like lighting. Since Amazon is known for
being techy savvy, most of its services and products are technological. It uses data analysis of
consumer behavior and history to determine the type and kind of products their potential buyers
are willing and able to buy. By making use of this initiative, Amazon is able to study and know
the consumer behavior of her shopping in terms of preference and taste. Amazon takes the
findings received from the study of consumer shopping habits and uses them to avail those
products in close proximity to the potential consumer. This strategy has enabled and aided
Amazon in making fast deliveries.
[Link], on the other hand, also offers free membership and two-day shipping on
specific products. The client of Walmart gets to enjoy three percent cash back on all credit
purchases. They also enjoy a return policy of up to ninety days, while Amazon Prime members
get thirty days in the deal. [Link], however, does make use of tech gadgets as Amazon
does. It does also make use of consumer behavior to predict the consumer tastes and preference
in order to ship the predicted product to the nearest warehouse. However, Walmart had made
arrangements with big tech companies like Microsoft and Google in order to sell their goods on
google express. Additionally, both Walmart and Amazon both have shopping apps to improve
the customer experience and convenience in shopping. They both keep updating the apps with
new, better, and advanced features to ensure customer satisfaction and fulfillment.
Question 4
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We can all agree that success at both works and in life requires one to have skills
of making exceptional and informed decisions, especially when time is a constraint. There will
never be an ideal time to make informed decisions. Jeff knows this; he has mastered the art of
working with what you have at hand and making the most of it. He believes, in the business
world, speed is essential. If you don’t invest and solve a given problem today, someone else will
solve the problem tomorrow and make lots of money which should have been yours in the first
place. Amazon value speed thus Bezos know that most decisions do not need extensive study and
research to make, you sometimes just have to trust your instincts. This is why we always see
amazon introduce new products into the market now and then. Because of his decision-making
skills, he has remained in the CEO position for many years since Amazon was established in the
early nineties.
In conclusion, I think Bezos is making the right decisions in guiding the business. He has
identified the potential of incorporating and innovation into the business activities and ventures
of Amazon. The use of robots has reduced the labor cost hence maximizing profits. Through
innovation, he has been able to solve almost all the problems that amazon faces in relation to its
growth rate and size.
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References
Amazon: A role model for supply chain innovation in the wake of digitalization. (2017,
November 16). Technology and Operations Management.
[Link]
chain-innovation-in-the-wake-of-digitalization/
Chiles, C. R., & Dau, M. T. (2005). An analysis of current supply chain best practices in the
retail industry with case studies of Wal-Mart and Amazon. com (Doctoral dissertation,
Massachusetts Institute of Technology).
Mudambi, S. M., & Schuff, D. (2010). Research note: What makes a helpful online review? A
study of customer reviews on Amazon. com. MIS quarterly, 185-200.
