Background of the Company
Amazon is an online retail website which operates all over the world. This report concentrates on the background of Amazon along with the way that it had entered Australia. It also hold certain strategies that is used by Amazon Australia after it had entered the country. These strategies help the business to better engage with the customers. Moreover, the study focuses on strategies which could be used by the business for their growth and development and help it to move forward in the future. The strategies used for their growth will also help in deriving certain recommendations which, if followed by the company would help it to maintain a stable growth in its operations.
Amazon is one of the largest internet sellers in the world. It was found on July 5, 1994 by Jeff Bezos in Seattle, Washington. The website was initially established as an online bookstore and later diversified to selling videos, mp3, video games, audiobooks, electronic and others. Amazon has their retail websites in several countries like Australia, Germany, Netherlands, Italy, Ireland, United Kingdom, Singapore, Japan, India, Brazil and many others. Amazon officially launched in Australia in the year 20017, on December 5th. Prior to this Australia was only able to access certain Amazon products such as Kindle books, applications, audiobooks and a few games (Amazon.com.au 2018). After the official launch the citizens of Australia was able to access all products that were sold by Amazon. There are over 500 retailers who sell their products through the website of Amazon Australia and with time the numbers are expected to rise to a great deal.
Australia is current one of the highest currently to be engaged in e-commerce. The citizens of Australia spend a lot of their income on online products rather than going on traditional shopping. These factors make Australia favourite of online retailers to expand their business and connect with the population of Australia. Amazon has expanded their business in Australia with the same aim to target the huge population of Australia who are aligned towards online shopping (Armstrong et al. 2014). The advantage of Amazon was that since it is a global brand, it was famous in Australia even before it launched. This is why they did not have to market or advertise their website to attract the crowd and the people automatically got associated with the website. However, Amazon provided various benefits to the Australian consumers which attracted them more to the products of the website (Grant 2016). The benefits provided are as follows. Firstly, Amazon offered their products at a much lower price than the other ecommerce and retail stores at the beginning of their launch. They also provided different discount offers and packages to the customers. Secondly, Amazon offers the business owners of Australia to sell their products. This gave the small businesses the opportunity to connect with a huge base of customers and to showcase their products to them. This would help them to grow and expand their business faster than they were able to as a retail store. Thirdly, they offered shopping benefits to the customers such as free shipping in very less time than the other online retail websites (Ryan 2016). The feature of Amazon Prime has not been started in Australia yet, however depending on the kind of product, the delivery can be made in one or two days. Lastly, Amazon provided a wide range of products from various sellers and sold their own branded products along with several products from both local and international producers.
Amazon Australia’s Marketing Strategy
The marketing strategy of Amazon Australia is firstly based on six aspects which are to produce a wide range of products to their customers, to understand the need of the customers, to make optimum utilization of their resources, to use the existing systems of communication, to grow from being small or a very large online presence and to maintain a customer centric interface (Wu et al. 2013, p. 256-293). Based on these six aspects, Amazon Australia forms different strategies for marketing their products and their brand name in the market of Australia. The first strategy to connect with the market is segmentation, targeting and position of the products in the market (Khan 2013, p. 56-65). Amazon Australia takes the help of psychographic and demographic features to segment their market. This means that they focus on the age, gender, annual income, and the purchasing pattern of the customers. They segment the customers based on their interests of products and the buying capacity. The targeting of the customers is done on the basis of the segmentation. Among the segmented population, the people who are mostly experienced with using basic technology and belong to the middle and the upper class are targeted. Those people are also targeted who have less time to physically shop from retail stores. The Amazon Australia positions its products in such a way so that every consumer can get their products delivered even in remote areas.
Another marketing strategy is to differentiate itself from the other online retailers and to establish their competitive advantage in the market (Herhausen et al. 2015, p. 309-325). The competitive edge of Amazon Australia is their customer centric approach. They analyse the buying behaviour of their customers and aim to provide the products according to their purchasing behaviour. This has become a competitive edge for them since it is often hard for online retailers ot understand the buying pattern of the customers due to huge customer base and the huge number of retailers to supply the same. More than 505 of Amazon Australia customers are repeat customers and this makes them the longest running online retail website in the whole world. In the short time, that Amazon has established itself in Australia it has already been able to attract the consumer towards them and associate them with the easiness of online shopping.
Amazon Australia offers free shipping for the products over a certain amount and even allows facilities such as paying cash on delivery of the products or even paying it online. In Australia they have even started the feature of paying one day prior to the delivery so that the customers can order the product hassle free even if they cannot pay at the time. The delivery is made at the preferred time that is given by the customer according to the place of delivery being office or home (Klaus 2013, p. 443-457). These features have created quite an impact on the customers of Australia and have led them to believe that Amazon serves the customers in the best possible way and keeps their comfort in mind while delivering their products.
Strategic Marketing Options for Amazon Australia Moving Forward
It is important for every business to grow and expand to gain more profits. For this to happen a business or marketing strategy is used which will help the company to develop their performance and gain competitive edge over the other businesses. Therefore, growth is a very important factor for the companies to survive in the competitive market (Alsos, Carter and Ljunggren 2014, p. 97-122). There are different strategies for growth and some are more effective than the other. One of the most effective strategies for growth is the Ansoff Matrix. The Ansoff Matrix was established in the year 1965 by Igor Ansoff and this strategy is used to develop the strategic options for growth of businesses (Hussain et al. 2013, p. 196-206). The Ansoff matrix has four quadrants which describes four stages of growth (Appendix 1). The first is the market penetration. This growth strategy focuses on the existing products which are present in the business (Van Weele and Van Raaij 2014, p. 56-72). This means that the business wants to expand the current status of their business and wants to grow with what they are currently working. This stage makes the business realise the importance of their current products and the reasons because of which they have been able to penetrate the market. During the market penetration stage the business would have to be aware that they are able to grab the attention of the customers with the products that they have and are able to offer something better than the existing businesses in the market.
The second stage is the market development. This stage aims to develop the market for the existing products. In this scenario the business wants to find new markets where they could showcase their existing products and attract a new group of customers (Bocken, Fil and Prabhu 2016, p. 295-308). They want to identify markets who have similar needs like the existing customers of the business. The business could identify a new group of customers who would be able to use the products in a different way than the others. This is also a kind of market development, where the product is developed by multiple usage. The third stage of this matrix is product development which means to develop certain new products for the existing market. In this scenario, the market aims to develop a variety of new products which would be used by the existing customers (Gitau 2013). This is done to increase the profitability and the position in the market. The introduction of new products into the market would be able to grab more attention from the customers since it is in the nature of human beings to be attracted towards anything that is new in the market. The last stage of the matrix is diversification which means to develop new products for new markets. This level is one of great risk where the business aims to expand their operations and develop new products for a completely new market where they have not operated before (Craciun and Barbu 2014, p. 69). This is a risk as the business would have to start from the beginning by analysing the market and the customers in order to succeed in the market. For Amazon Australia the market penetration has occurred when Amazon entered the country with its range of existing products. The market development for Amazon Australia would be to understand the needs of the consumers and showcase their existing products which are liked by the consumers and segment the customers according to their needs so that they are able to serve the consumers better. Amazon Australia could further grow in the third stage of the Ansoff Matrix which is product development (Abubakar et al. 2015). They could introduce new features for their existing customers which would be liked by them. For example, Amazon Prime could be introduced in Australia which would make one and two day deliveries in case of urgent requirement. Moreover, Amazon could collaborate with certain well-known brands which are prevalent in Australia and are a favourite of the population so that they could increase their customer base. The last stage would be relatively new for Amazon Australia since it is itself a new development in the market of Australia. However, it could aim to grow more in the future by targeting and developing in those areas of the country where it has still not been able to reach (Eyvrigh 2016, p. 77). These recommendations would help the business to grow into a strong online retailer in the country of Australia where online shopping it at great heights among the population who have extensive buying capacity.
Conclusion
Hence it can be concluded that Amazon Australia have been able to successfully place itself in the Australian market and establish their dominance over other online retail websites by grabbing the attention of the buyers and with their customer centric approach. They have used different marketing strategies such as segmentation, targeting and positioning of their products and developing their competitive edge to grow in the market. The main competitive edge of Amazon is their customer centric approach which differentiates it from other online websites since they analyse the buying behaviour of their customers to give them the best experience. However, even though Amazon have been able to successfully penetrate in Australia it would need strategies to develop and grow in the country so that they are able to maintain their foothold in e-commerce. For this the Ansoff matrix have been used to derive strategies ad recommendations which would help in the growth of the business and make it a favourite among the customers.
References
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