Diversification And Structure: Specific Product Strategies Of Amazon Under A Conglomerate Structure
To understand the business strategy of Amazon, it is important to highlight the fact that it is not only an e-commerce company or an Internet retailer but also a physical retailer, publisher of multimedia contents, manufacturer and marketer of merchandises and technological products, and a provider of other online-enabled and cloud computingsolutions and services.
Remember that the company started as an online bookstore. As part of its specific product strategy, it later diversified to sell different products to include clothing and apparel, home and office furnishing, consumer electronics, software and video games, and other multimedia contents such as music, videos, and audiobooks.
Amazon has ventured further into different lines of business to expand the variety of goods and services it sells. Beyond its Amazon.com online storefront that allows individuals and small retailers to sell their products via the Internet, the company also owns and/or operates brick and mortar storefronts such as the American supermarket chain Whole Foods Market that specializes in selling organic products, and the partially automated grocery store Amazon Go.
How Does Amazon B2b Work / How Does Amazon Business Work
Amazon B2B with Amazon Business works by giving benefits to businesses buying on Amazon with a Business Account for Amazon.
Sellers have access to an array of selling options not available to standard Professional Seller accounts that make their listings more attractive to business buyers.
How Amazon B2B / Amazon Business Works For Sellers:
- Exclusive Business SKUs: Businesses can create listings only for businesses, that can only be seen by business buyers.
- Business Pricing & Quantity Discounts: Discounted business prices and tiered quantity discounts are only available to customers in the Amazon Business Buyer Program.
- Business Price: A discounted price available only to businesses regardless of the quantity purchased.
- Quantity Discount: Tiered discounts set by the business available for large quantity purchases.
As a business buyer with an Amazon Business Account, special business only perks make it simple and smart to buy on Amazon Business.
How Amazon B2B / Amazon Business Works For Buyers:
But thats just part of the story, what are the costs for an Amazon Business Account?
Business Only Prices Are Available To Members
Because most businesses are buying in bulk, Amazon can offer lower prices on literally millions of products for multi-unit purchases. It also has general price cuts on millions of business products and provides an easy way to compare prices from a wide array of sellers.
And If you want to get good deals, you can even request discounts from some sellers when buying their products in bulk.
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Research And Development: Using Technology To Gain A Competitive Advantage And Develop New Products And
Research and development or R& D is also central to the business strategy of Amazon. Remember that this company is not just an Internet retailer but also a manufacturer of numerous products, including consumer electronic devices, as well a provider of online-enabled and cloud computing services. The goal of its R& D activities is to develop new products or services, gain a competitive advantage and improve its operations through the use of relevant technologies, and keep up with the pace of technological developments.
The introduction of Alexa marks the entry of Amazon in the artificial intelligence and machine learning business, thus competing against other tech giants such as Apple Inc., , and Microsoft Corporation, as well as demonstrating adherence to current trends in the market. Note that Alexa is a virtual assistant used for controlling smart devices and for implementing a home automation system.
In its attempt to promote the energy efficiency of its numerous facilities and centers, the company is also developing clean energy technologies such as wind and solar power through solar panels. Independence from the power grid would help the company drive down costs associated with energy consumption, while also fulfilling its corporate social responsibility.
History And Business Model
AmazonFresh has rolled out its services gradually, targeting specific parts of various metropolitan areas and partnering with local speciality stores for delivery of local items. The Amazon Fresh website allows potential customers to check availability by ZIP code.
In its former names Amazon Grocery, It used to be a proud sponsor of on .
In March 2017, Amazon announced the beta launch, on March 29, 2017, of Amazon Fresh Pickup, a drive-in-type grocery store for Amazon Prime subscribers. It is a delivery service that lets users shop online, reserve times to pick up the groceries, and have them loaded into their cars at the store.
In Germany, the product range is 85,000 product lines. By comparison, the supermarket chain’s home delivery service has 9,000 product lines.
In the United Kingdom, Amazon signed a deal with the British SuperMarket chain to provide supplies for and PrimeFresh.
In July 2017, it was reported that Amazon Fresh was selling .
On November 2, 2017, Amazon announced it was discontinuing its Fresh service to some smaller towns and cities in California, Delaware, Maryland, New Jersey, New York, and Pennsylvania.
On December 13, 2019, Amazon announced its Fresh service will provide one and two hour delivery of meat, seafood, eggs, and produce in Tampa, Florida.
On March 4, 2021, the first Amazon Fresh store in was opened, in the shopping mall in , West . The site previously had been occupied by the clothing retailer .
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Probabilistic Methods For Uncertain Reasoning
Many problems in AI require the agent to operate with incomplete or uncertain information. AI researchers have devised a number of powerful tools to solve these problems using methods from theory and economics.are a very general tool that can be used for various problems: reasoning , , and .Probabilistic algorithms can also be used for filtering, prediction, smoothing and finding explanations for streams of data, helping systems to analyze processes that occur over time .
A key concept from the science of economics is “”: a measure of how valuable something is to an intelligent agent. Precise mathematical tools have been developed that analyze how an agent can make choices and plan, using , ,and . These tools include models such as , dynamic , and .
How Online Stores Can Compete With Amazon
Now that youve had a chance to see some of Amazons top competitors, its time for me to show you how online stores can compete with Amazon.
You dont need to be the next Walmart, Alibaba, or eBay to have success selling online. Your online store doesnt need $1 billion in revenue to go up against this global giant.
All you need to do is follow the lead of successful brands in the space. You can even steal the playbook from Amazon directly and apply it to your business.
These are the top 12 tips for competing with Amazon online.
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How Does Amazon Respond To Failures And Setbacks
Amazon has been known for having a high turnover rate with staff, which is an expense for the company. Constant demand on resources for hiring new employees and training would be inefficient and costly. Amazon has attempted to alleviate the employee loyalty concern by offering employee stocks options as compensation . They also try to entice workers to stay longer by requiring the employee to pay back a portion of their signing bonus if they leave early. Some describe the workplace as “Darwinism.” 29
One writer discusses how Jeff Bezos “brags” about his failures . The major difference between Amazon is that the company embraces their failures and tries learns from them. 30
Cost Structure Of Amazon
Amazons cost structure is driven by value. It means that Amazon function on a system that only benefits them economically. Its IT, and fulfillment centre is also a vital component in this regard as it enables Amazon to operate on a global scale. Other essential elements utilized in the cost structure of Amazon include its customer service centers as well as software development centers across the world.
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Online Arbitrage On Amazon
Online arbitrage is a method of finding a low-cost or discount product on one website or online marketplace to resell on another marketplace.
Like retail arbitrage, the profits online arbitrage sellers on Amazon earn is the difference between the price for which they can sell the product on Amazon minus and the original cost of the product.
Editing Your Business Profile
Your business profile includes all of the information about your business that Amazon Pay needs to process your payments, such as your business name, address, and phone number. It also includes your type of business and expected income from your website.
Typically, you need to enter this only when you are signing up for Amazon Pay however, if you change your business information , you can change your information on the Account Info page.
Note: If your business information changes, you should keep your profile updated.
To edit your business profile, follow these steps:
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What Are The Different Amazon Business Models
There are six over-arching business models used by third-party sellers to effectively generate revenue. Some are more widely used than others with the right method for you being completely dependent on the types of products youre interested in selling, your goals, budgets and much more there is no right or wrong model to follow.
Expanding Their Offline Retail Footprint
Amazon seems determined to build a local retail presence because while one-click shopping is lucrative, Amazon understands the importance of experiences . And Amazon.com is optimized for conversions and upsells, and they are betting that bricks-and-clicks experiences can further increase sales.
Id be inclined to agree. Trying on clothes and shopping is something many Americans love. And discussed in a previous post, local retail makes a ton of sense for products that either:
- have a high online return rate
- have high value to weight ratio
Expect to see Amazon rapidly expanding local operations to test out in-store experiences. More on this in our acquisitions section.
Because malls are a thing for a reason
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Navya Arma Driving System
On 9 November 2017, a Arma automated self-driving bus with passengers was involved in a crash with a truck. The truck was found to be at fault of the crash, reversing into the stationary automated bus. The automated bus did not take evasive actions or apply techniques such as flashing its headlights, or sounding the horn. As one passenger commented, “The shuttle didn’t have the ability to move back. The shuttle just stayed still.”
Putting It All Together
Jeff Bezos offers a portrait of Amazon which is useful to understand its business model deeply. First, it all starts with Day One.
This, to me, is a way for Amazon to keep a start-up mindset also if it has become a large organization. It means focusing on customers, therefore, experimenting with new product lines, services, or anything that might become delightful to the public.
In fact, once Amazon does identify strong trends, rather than fight them it embraces them. One example is how nowadays Amazon is using AI and machine learning as the main propellers for its business growth.
In other words, practically speaking this makes Amazon fluid. Thus, the Amazon of tomorrow might have a different face but the same soal compared to the Amazon of today.
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Get Your Pricing Right
Finding the right pricing for your products is tough enough, but Amazon adds a section in your selling agreement, a pricing parity clause which you need to really to be mindful of if you do not want to be penalized or shut down on the platform!
In the clause, it states that your item price and total price cant be lower than any other online sales channel according to the general pricing rule. This includes your own personal ecommerce sites. If you break this agreement, you might be penalized or put on hold as a vendor on Amazon.
A Skeptical View Of Proxies
As companies get larger and more complex, theres a tendency to manage to proxies.
What does that mean?
A common example is process as proxy. Good process serves you so you can serve customers. But if youre not watchful, the process can become the thing. This can happen very easily in large organizations
The process is not the thing. Its always worth asking, do we own the process or does the process own us?
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How Does Amazon Respond To Competition
Whats really happening out there is that Amazon is shredding the competition, and the competition just doesnt know what to do about it. 22
Amazon expanded their services quickly and have caught competitors by surprise by some of the industries they have invested in . By expanding quickly and taking minimal profit, it is hard for competition to keep up with Amazon. 23
An example of how Amazon responded to competition in the area of movies is how they introduced offline streaming a year well before Netflix offered this feature. 37 Amazon did this to lessen the cost for the customer , and increase ease of use anywhere . 36 This is a perfect example of how Amazon is pushing the bar for innovation and is ahead of their competitors. Originally, Netflix stated they wouldn’t offer offline streaming, but after a year of Amazon offering this, Netflix introduced it to their consumers as an option. As discussed earlier, Jeff Bezos does not focus his energy on competition, but rather on the consumer and how he can appeal to their loyalty and satisfaction. As a result, this overflows into advancement and development of ways that consumers are more satisfied .
Amazon’s Strategy To Success
Amazon Focuses On The Long Term Not The Short Term
We are comfortable planting seeds and waiting for them to grow into trees, says Bezos. We dont focus on the optics of the next quarter we focus on what is going to be good for customers. I think this aspect of our culture is rare. 4
Amazon Builds Its Strategies On Things That Don’t Change
“Base your strategy on things that wont change….Whereas if you base your strategy first and foremost on more transitory thingswho your competitors are, what kind of technologies are available, and so onthose things are going to change so rapidly that youre going to have to change your strategy very rapidly, too.“ 5
Bezos notes customers want “selection, low prices, and fast delivery”. He shares how these three desires of the consumer are likely not going to change. 5
Learn more about
Amazon Sees Opportunities and Not Failures
Amazon Has Strong Values & Company Culture
The values of Amazon has impacted their leadership and success in Online Retailing. The website lists Amazon’s principles and values for working at the company and they are listed below: 10
- Customer Obsession
- Invent and Simplify
- Are Right, A Lot
- Hire and Develop the Best
- Insist on the Highest Standards
- Think Big
- Bias for Action
- Learn and Be Curious
- Earn Trust
- Dive Deep
- Have Backbone Disagree and Commit
- Deliver Results
Amazon Stresses The Importance Of Customer Satisfaction Instead Of The Competitor
Become The Leader In Your Market
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What Type Of E
Amazon.com is the biggest online retailer in the world. The business is a B2C and a C2C market, which means it sells products directly to consumers and allows users to sell goods themselves.
Amazons business-to-consumer and business-to-business divisions overlap somewhat. For example, when Amazon assists a seller in creating her own page where she can list her items, Amazon is indirectly serving customers.Amazon, on the other hand, sells its own items, both fresh and used, that customers can buy directly from Amazon. Amazon also represents customers in this manner now that it has penetrated the digital media realm with its unique Kindle e-reader and range of e-books.For a monthly charge, Amazon Prime provides customers with discounted instant video and e-books, as well as free shipping offers.
Amazon B2B, also known as , offers shopping options for registered companies looking to purchase business supplies from Amazon. Businesses of all sizes, wholesalers, and suppliers may use the platform to purchase and sell to one another and obtain discounts based on the quantity ordered.
Top Notch Artificial Intelligence
Amazon has some of the best AI experts, period. Between the folks building Alexa to the millions of A/B tests running every day, and the eerily accurate product recommendations, Amazons combination of data and machine learning is rivaled only by Google.
And as anyone with experience in data and AI understands, this creates a flywheel where the rich get richer which we clearly see with Amazon.
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Amazon B2b: Everything Amazon Sellers Need To Know About Amazon Business
What is Amazon B2B? Amazon B2B refers to Amazon Business, Amazons business to business selling & purchasing marketplace.
Amazon B2B enables your company to become an Amazon Business Seller with an Amazon Business Account through Seller Central to sell in bulk with bulk pricing, offer discounts & tax exemption to only businesses & much more.
If youre an Amazon Business Seller or are looking to become an Amazon Business Seller, you will learn EXACTLY what Amazon B2B is, how Amazon B2B works for buyers and how a Business Account for Amazon works for sellers.
Imagine this, selling B2B without sales reps salaries, commissions and per diems. Sounds pretty great, right? Well, did you know you can do this on the SAME marketplace you sell to consumers? You can! Its Amazon B2B using an Amazon Business Account.
What is Amazon B2B? Amazon B2B is Amazons mechanism for businesses to sell their products directly to other businesses through Amazons B2B Marketplace, Amazon Business.
What is Amazon Business? Amazon Business is Amazons B2B marketplace that allows businesses of any size to register for a Business Account for Amazon and purchase business supplies on Amazon at various bulk rate discounts.