Human beings are often known for their ability to adapt. This is reflected particularly on the scale of the company, which, if it captures a large market share for a period, all things being equal, it can also be modified in a context growing in strategic reorientation.
The gradual emergence of new technologies for digital broadcasting, through the opening to the public Internet in 1990 (www), greatly upset many markets, this has tended to gradually create new sales channels, a new "place of purchase".
For the players in the market, it did not change immediately, but in a new area where officers were not necessarily the most informed, were upset that the precursors pre-established organizations and imposed businesses.
In 1994, Jeffrey Preston Bezos, Seattle created amazon.com. The rise was phenomenal. Two years after its inception, the company went public at Nasdaq in New York. The explosion of Internet access enabled the company to become a global giant of culture. In late 2004, the enterprise made almost all of its revenue on the Internet, and had 9000 employees for a turnover of around 8.5 million dollars. The company also suffered some financial charges, and one will see that it is very interesting to see how Amazon has launched and how it has continuously adapted to the markets to maximize its advantage when starting.
This study will be articulated around this problem: "How Amazon was able to penetrate the market eventually, and adapt to remain a leader in e-business." In the first part, the focus will be on an external analysis of the company, with the support of an internal analysis, and it will make a complete study of the company's strategic directions.
In conclusion, it will recall a synthetic material, which then will lead to the identification of the key elements of the focus of this analysis, to finally provide a recommendation to the company.
It is interesting to note that in 1997, stores such as multimedia FNAC and Virgin showed the best results, while bookstores had seen their results decrease. These are the main victims because of the arrival of substitutes and also because of the changing profiles of consumers.
Indeed, one has seen in recent years technological developments occurring rapidly. This results in the emergence of new distribution media for leisure but also by creating new cultural product. The advent of CDs and DVDs came directly to compete with paper and go beyond as evidenced by the CD-audio music, DVD-Video for movies and even CD-ROMs for video games and software.
Also books in digital form are emerging as evidenced by the initiatives taken by the company Havas, which aims to broadcast all of its Internet offers in three years.
Moreover, this trend seems to be reinforced by the changing profile of consumers since through a survey conducted in 1997 on the French cultural practices, it was found that the proportion of strong players, that is to say, those buying products that are more than twenty-five pounds a year, tend to decrease and is only 14% now against 17% in 1988.
The emergence of substitute products is not foreign and the generation of 15-24 year olds, due to the expansion of the supply of cultural products, no longer consumes the same way as the older generation.
Tags: amazon.com, e-business, company analysis,
[...] At the start of summer 1998, Amazon expanded its offering to include music, video, software, equipment for the home, garden or car, luxury, beauty, and even the auction segment, with a joint venture with Sotheby's. The company became a real online shopping mall, and strengthened its e-business in Gross's book. Though Amazon was a pioneer in 1994, things changed in the following years with the arrival of dozens of competitors exerting strong competitive pressure. The company, once again, showed the ability to adapt intelligently to changing market conditions. [...]
[...] Forces Weaknesses Strong competitive advantage as - Computers and internet are not a pioneer and leader in online accessible to everyone sales - Payment by internet worries some Wide variety of products offered potential buyers Search mode easier for the - The need to secure transactions customer - Profitability negative until 2002 -Provision of information on many products, with personalized services Fast Delivery Competitive and attractive prices Lack of physical selling locations Advances in computer technology and Internet marketing through innovation Reputation, image Investor confidence Network of partners which is important Part III A study of the strategic directions III.A - Cost / volume strategy for differentiation A differentiation strategy should be considered when contemplating entry into a market that is already being served by competitors, or a market which is mature, and has a fiercely competitive business that sells standardized products to the same target, which generally responds in the same way. [...]
[...] We will articulate our study around this problem: "How Amazon was able to penetrate the market eventually, and adapt to remain a leader in business." In the first part, we focus on an external analysis of the company, with the support of an internal analysis, and make a complete study of the company's strategic directions. In conclusion, we will recall a synthetic material, which then will lead us to identify the key elements of the focus of our analysis, to finally provide a recommendation to the company. [...]
[...] Opportunities Threats The important development of - Competition increasingly intense online sales - Slowdown of the books market Technological innovation and - Appearance of scanned books marketing of Amazon gives it new (Google print) sources of growth - Volatility of clients Market entry in online pharmacy - Bargaining power of suppliers with the bid for 46% of - Managing to retain highly Drugstore.com qualified staff Market entry through the - Scope limited to internet only partnership with Sotheby's Development of Internet advertising (spamming, banners) Continued increase in gas prices movement towards internet purchases Part II - Internal analysis II.A - Forces In 1994, Amazon was the first company to have created an online bookstore, which enabled it to distinguish itself from its competitors, and have thus a strong competitive position as a leader. [...]
[...] We will now study the strategic action areas of the company, and we will see that this case presents an ambiguous feature. Initially, the books market is where Amazon has taken root, its distribution is based on a differentiation strategy. So the graphical representation of SBAs of the company when it was launched has been given below. The company is only established in the books market, the retail sector, and has only one strategic area for action which is the sale of books online. [...]
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