Amazon Company Product SWOT Analysis

With its headquarters in Washington, the largest and fastest-growing online retailer, Amazon, was established in 1994. One of the biggest online retailers, the business offers customers technological goods and online services. The company uses an online e-commerce platform to distribute goods and services to its clients (Jain, 2015). The company has expanded to have numerous other outlets in numerous nations, including Brazil, Canada, Spain, Italy, Germany, and China. It is without a doubt one of the most capitalized businesses in the modern era. Amazon was founded by Jeff Bezos and was first named as Cadabra but later renamed to Amazon one year after its inception. The company has an efficient integrated system that has built the company’s brand name from a small local store serving the US market to a large multinational company serving a large global level market. It first offered its common stock to the market in the year 1997 (Siau, 2003), and has continued creating more job opportunities over the years. The employee base involved thirty thousand to one hundred and twenty thousand workers in the year 2016. The company’s strategy to expand and grow in the future encourages diversity as evidenced by employees from all over the world including the freelance employees from their remote offices.

Core products/services

The core products range from books, selling of DVDs, selling of videos, health and household products and songs among many other products. The core services offered, on the other hand, include freelance services and e-commerce services. The company provides free shipping on certain eligible orders giving it a mileage in terms of service delivery with regard to the competitive market. Amazon have established strong marketing channels together with good customer loyalty; earning them a better reputation in comparison with their competitors. In other words, Amazon’s strong customer focused strategies have given them a strong foundation to outdo its competitors (De Fino, 2012).

Key Current Competitors

Wal-Mart, a book vending stores in the United States is Amazon’s greatest competitor and have had court cases on the brand advertising claim that Amazon is the largest online bookstore. Wal-Mart over the years has emerged a strong competitor making Amazon diversify and brand its products. Amazon has strategically branded its products using the company’s brand name like the Amazon digital game store, the Amazon drive, Amazon Prime and Amazon Wireless just to mention a few that are branded using the company’s trademark name (Awais, 2012).

The Product SWOT Analysis

The company has plans for a new service it intends to offer online; the E-book. Through E-book platform, customers are provided with an easy access platform to read scholarly articles or books at any moment and anywhere. It specifically targets research scholars in the global market. For maximum marketing of the e-books service, the company should focus on the SWOT analysis.

The new service, offered by Amazon, deserves SWOT analysis in the sense that research started long time ago and many companies have devised ways of sharing knowledge on their websites. It is, therefore, important to evaluate better ways of winning clients loyalty for the new service.

Strengths

Amazon enjoys market leadership strength for being the leading online bookstore globally. It boasts of cost leadership and can control the costs it incurs while providing services to its clients and should thus make good pricing decisions to aid market the new product.

In the company’s internal environment there is the use of a powerful online marketing module and a highly sophisticated e-commerce module offering an advantage over the competitors. The company should additionally offer convenient services to clients of the new product by relying on e-commerce systems.

The company’s brand name has a global recognition as one of the best brand names globally hence a foot forward for the new product’s market penetration.

Amazon has embraced the strong distribution and logistics channel aiding delivery to clients at the required time and will play a great role in growing the new product market.

Weaknesses

The diversification strategy has resulted to diminishing markets on the company’s primary product line like continuously losing competence in the bookselling expertise thus opening gaps for new companies to venture.

The Marketing strategy of the company in free shipping of products to clients poses a risk to its ability to generate profits for growth and safeguarding the shareholder’s interests.

The focus on the online market may pose a significant weakness due to lack of concentration offline markets.

Opportunities

The company on its strategic expansion strategy has rolled out a new payment system that protects the customers’ privacy and providing security for the customers hence more sales.

New product lines can take advantage of the company’s name to earn a market reputation.

More online e-commerce sites can be opened for marketing the new product.

Threats

There are risks posed by e-commerce systems through cyber-crime and online theft and the company should provide strong cyber protection.

Amazon as the industry’s cost leader faces threats of lawsuits from suppliers over the competitive pricing strategy.

There is the threat of high competition from emerging online retailers in the local market hence may lose client loyalty.

In conclusion, Amazon should focus on matching the product features of products made for Amazon research scholars to the company strengths to utilize available opportunities. The emphasis in controlling the internal weaknesses will reduce the risks faced by the company hence meet specific needs of the clients and beat the market competition.

References

Awais, M., & Samin, T. (2012). Advanced SWOT Analysis of E-commerce. International Journal of Computer Science Issues, 9(2).

De Fino, M. (2012). Amazon for Technical Services Librarians: Making Order of the Jungle. Technical Services Quarterly, 29(4), 280-291. http://dx.doi.org/10.1080/07317131.2012.705726

JAIN, M. S. (2015). E-COMMERCE: SWOT ANALYSIS. International Journal of Marketing, Financial Services and Management Research, 4(9).

Siau, K., & Shen, Z. (2003). Building customer trust in mobile commerce. Communications of the ACM, 46(4), 91-94.