Amazon and their rival organizations in Australian market
Discuss About The Change Technological Forecasting And Social?
Amazon.com, Inc is an electronic commerce organization that is headquartered in Washington, United States of America. The organization was primarily established by Jeff Bezos in the year of 1994 and currently the organization is the biggest online retailer in the global market in a measure of revenue and the capitalization of market. Amazon operates in the market of United States of America, France, Canada, China, Brazil, Australia and in many more countries. The organization initially started selling books and later they initiated selling electronics, various software, furniture, toys, electrical goods and many more. In this regard it is worth mentioning that the management of Amazon has launched different websites for different countries where they operate.
The target customers of Amazon Australia are the individuals who are adults and the early adopters are undoubtedly the favorite customers of the management of Amazon Australia. The generation of revenue of the organization immensely depends on the early adopters as these individuals are always enthusiastic to try new products of the market and this group of customers is seen to be lesser price sensitive than the rest of the customers. Apart from that these individuals are loyal towards the organization and they endorse the products of Amazon through word of mouth advertising method willingly (O’Connor 2017). The management of Amazon Australia thus rewards the early adopters by providing them early access to the latest products and these customers also get special benefits. The management of Amazon has aggressively captured the market of baby diapers by lowering the prices and then they bought the organization Quidsi, one of their rival organizations. After that, the new parents of their operational market have become major target customers for the management of Amazon Australia. As these new parents, who are young adults tends to develop a shopping habit for their infant (Abedin 2016). The management of Amazon Australia has seen this trend and targets this customer base with Amazon family that provides almost 20% discount to the Prime members for the subscriptions to diapers and other products for babies (O’Connor 2017). The purpose of this report is to draw a gather the knowledge regarding the consumer behavior of the target customers of Amazon Australia.
Currently Amazon is one of the biggest online retailers in the global market and when they established their business in Australia a few months ago, the management of Amazon Australia has observed that in the Australian market the growth of online sales has increased almost 10 to 12 % and to capitalize the situation the management of Amazon expanded their business to Australia. The major rival companies of Amazon Australia are the organizations like Harvey Norman, Myer, JB HiFi and many more. The management of Amazon Australia is targeting to establish their business ion the market of Australia by providing exciting offers to the target customers and by selling the products and giving opportunities to the target customers after getting to know their requirements (Abedin 2016). Thus, it can be said that getting to know the requirements of the customers are important for the success of a retailer organization. It is seen that the management of Amazon Australia is reputed for their aggressive way of capturing the market and in this scenario; the management of the rival organizations are thinking that by lowering the prices immensely the management of Amazon Australia might capture the total online retail market of Australia making it difficult for them to sustain (Cavusgil et al. 2014). The management of Amazon Australia uses better distribution and logistics system and that helps the organization to satisfy the requirements of the customers more easily and that can help them to gain the competitive advantage on their rival organizations. Apart from that, another feature allows the management of Amazon to gain competitive advantage and that is leveraging Information technology and the usage of e-commerce makes it sure that the productivity and profitability of the organization remain higher than the rival organizations in the market of operation.
Learning theories for the customers of Amazon Australia
There are mostly two types of target customers of Amazon Australia and those are new parents and early adopters. The early adopters are the ones who show enthusiasm to buy the latest products launched by the organization and these customers do not care for the monetary aspects. Thus these are the major customers of Amazon Australia, who will determine the profitability of the organization in the Australian market. The other group of target customers of Amazon Australia is the new parents; as the management of the organization has captured the most of the baby diapers and the products for the infants, the new parents automatically became the target customer groups. In this section of this report it will be discussed that which or which combination of learning theories will help these customers to learn the services provided by the management of Amazon Australia.
There are mostly two types of learning theories that the consumers can utilize and those are behavioral approach and cognitive approach to learning. In the behavioral approach, the process of learning occurs as a response to the events taking place in an individual’s external environment. On the contrary, in the cognitive approach, the learning becomes a result of the individual’s deliberate and conscious information processing and the storage activity (Hsu 2018).
The management of Amazon Australia provides their target customers with unique rewards and attractive facilities to keep them loyal towards the organization and these are positive aspects of the management of the organization as when a target customer experience that he or she can easily choose the products from the shopping portal and get exciting offers and good service from the organization, naturally they will tend to buy products from the organization and make some researches in order to avail the exciting offers provided by the organization (Walker 2017).
On the other hand, looking at the advertisements of the organization, the target customers of the organization can accumulate necessary information regarding the services of the organization that will make it easier for them to take the right decisions to choose the organization from whom they will buy products (Hsu 2018). It can be said that the combination of these two theories can be fruitful for the target customers of Amazon Australia to choose the right organization from whom they want to purchase goods.
In this context, it is worth mentioning that the consumers cannot take their decisions alone and they will be needing to get some information from different types of sources like reference groups, advertisements of the organization or any other secondary or primary source of information (Li, Nagurney and Yu 2017). The decision making process of the target customers of the organization is among the stimulus for the purchase, the requirements of the consumers and the corresponding responses. The stimuli can either be inter-personal or intra-personal from the customers. This issue can be explained in more details using the black box model.
The box involves the characteristics of the customers and the decision making process of the customers. The external and internal factors might be represented in the model as the environmental stimuli and the buyer characteristics. These factors will both manipulate the process of decision making. From the identification of the issue till the post assessment of the decisions at every step is vital for the customer that can unswervingly to the marketing strategies. The learning which is positive can reduce the time for making decisions where the customer can eliminate the choices and the customers will take lesser time to do market research. It can be said that all these aspects are related to the motivation, learning, psychological factors and the personality of the consumer (Walker 2017).
Black box model
It is a matter of fact that, from the above mentioned theories the information regarding Amazon Australia the target customers will get will either positively or negatively impact on the relationship between the organization and the target customers (Li, Nagurney and Yu 2017). On the other hand, the observational learning materials for the consumers, like advertisements of the organizations can influence the target customers to buy the products from that specific organization.
Reference groups
The term reference group refers to a group of individuals; to which another group or an individual can be compared. Further it can be said that the reference groups can be used to determine and evaluate the nature of other group’s or individual’s sociological attributes and characteristics. The reference groups give benchmarks and the required contrast to evaluate and compare groups and the personal characteristics.
When a particular reference group is seen used as a source of information, people get all the necessary information from the group members. In this way, either the information is shared verbally or in form of writing from the direct instruction, observation or demonstration by the group members (Cavusgil et al. 2014). In this way, the members become the authoritative source for all types of information. There are always some members who are dependent on the others regarding gathering the information. When the source of information is seen as reliable and the provided information is relevant to the issue, it becomes more influential. For an example, if a 20 years old computer engineer is asked for opinion regarding purchasing a laptop, he or she will become the most influential source of information.
In this regard, it is worth mentioning that the information might be dispersed within the reference group by social media websites, blogs and via social meetings. For an example, it can be said that an individual might ask for necessary information from the co-members of a reference group. The information can also be distributed among the members of the reference group informally or unintentionally.
Generally the reference groups are of two types, primary and secondary. In a primary reference groups the group members happen to have close bonding, frequent face to face interactions. The members of a primary reference groups tend to have a significant influence on the other individuals and that includes the influence in the marketplace (Li, Nagurney and Yu 2017). For an example, it can be said that if there is a small group of friends where the individuals are interested in automobile, and a group member is planning to buy a gadget for his or her car from Amazon, the other members of the group will definitely help that person to buy the product by providing him the necessary information regarding the product.
On the other hand, a secondary reference group is referred to the group in which the communication among the group members is lesser and example of such groups is large social clubs, professional organizations, or alumni associations. In this scenario, the influence of a group member to the other members of the group is lesser. It is seen that the secondary groups are generally formed from smaller primary groups (Cavusgil et al. 2014). For an example, it can be said that a person might choose to wear blue shirt and black pant just like the other individuals of his workplace does the same.
Diffusion theory of innovation demonstrates why, how and at what rate the new notions and technologies get spread. Everett Rogers widely popularized the theory of diffusion of innovation where he stated that diffusion is the way by which a unique innovation gets shared over time between the members of a social system. There are four major elements of theory of diffusion and those are; time, social system, the innovation itself and the communicational channel (Tigabu, Berkhout and van Beukering 2015). For the sustenance of the innovation, it should be widely adopted. In the rate of adoption, there should be a point where a unique innovation reaches the critical mass. To categorize the adopters, they can be divided into groups like early adopters, innovators, early majority, late majority and laggards. The diffusion can be seen in various ways and it is subject to the categories of innovation decision process and the adopters. The decisive factor of categorization of the adopters is innovativeness that can be explained as the degree to which a person adopts a new notion or idea.
Communication channels are one of the most fundamental aspects of diffusion theory of innovation and diffusion takes place among the individuals or organizations. The channels of communication allow the transfer of information from one unit to another unit (Li, Nagurney and Yu 2017). The patterns of communication or the capabilities should be established among the concerned parties as a minimum for diffusion to take place.
There are two major communicational channel of Amazon Australia and those are social media and the other one is word of mouth of the early adopters.
The social media in today’s world has become one of the major influential medium or channel of communication. In spite of noticeable accessibility and simplicity of the majority of the social media channels, if it is used wisely, it can effectively give opportunity to get connected with numerous new and existing stakeholders ( in this case, the customers) (Agnihotri et al. 2016). Apart from the opportunities, social media can invoke various challenges like other channels of communication if it is not used with proper caution. Since the last decade, there has been a significant increase in the usage of social media websites like Facebook, Twitter, YouTube and many more in order to share information and also to create content. In today’s ever changing world, various business organizations are trying to use social media as a platform to let know their target customers about their existence and the services they offer (Tigabu, Berkhout and van Beukering 2015).
Social media as a channel of communication has been advantageous in most of the cases. Social media effectively enhances the impact of the important information. Social media as a channel of communication leverage networks of individuals to make the sharing of information easier. The social media makes different messages to reach up to the diverse target audiences. The social media communicational channel can help the organization to directly provide messages to the target customers (Hudson et al. 2015). Apart from these, the social media is a major tool that can be used in building credibility and awareness. The business organization like Amazon Australia can be use social media in audience segmentation. The management of the organization can share messages which are specific to te requirements, concerns and desires of a particular target customer group while keeping in mind what factors can attract them to buy products.
Written or oral recommendation by the customers who are satisfied from the services provided by Amazon Australia can be a good word of mouth promotion for the specified business organization. Word of mouth promotion can be considered as one of the most influential form of marketing as when the target customers observe that there are numerous people who have bought the products and are satisfied, that would automatically influence the target customers to buy the products (Baker, Donthu and Kumar 2016). There is some presence of incorrect information sharing too. As some business organizations can hire people for word of mouth marketing and they write positive comments on the shopping portals regarding the products which they have never used. The customers would not be able to differentiate between the fake and the honest inputs.
At times, word of mouth can be effective as a channel of communication in the marketing campaign of any business organization, as it can provide an impactful solution to infiltrate the consumer guards in order to make them talk regarding a specified product. The word of mouth channel of communication is in general personal and that depicts that they are certainly not subject to the persuasion from the business organization regarding individual gains or becoming subject to being bias. This communicational channel impacts positively as it demonstrates the thinking or the statement of the consumers who have already used the product and the comments from the customers are generally considered as reliable source.
As the two targeted categories of customer groups of Amazon Australia are the early adopters and the new parents, the management of the organization should introduce some unique services or introduce some exciting offers for these two target customer groups in order to keep them loyal towards the organization. It is a matter of fact that the loyal and repeat customers immensely determines the success of any business organizations and thus the management of Amazon Australia should introduce some unique strategies to make the most of the Australian market. The management of Amazon Australia can provide some discounts and lower the preorder pricing to attract more people to become early adopters. The management can introduce a new reward system for the early adopters, like the individuals who will buy the latest model of I-phone or Mac book, can exchange their older model with significantly higher pricing. Apart from that the management can call a conference and reward the early adopters to make them believe that they are important for the organization. On the other hand, the management of Amazon Australia can lower the prices of the goods they sell for the infants. In this way the management can attract more new parents to buy products for their child from Amazon’s shopping portal only. Already Amazon has a reputation of lowering the prices aggressively to capture the market, thus, this strategy can effectively help the organization to establish in the market of Australia. The management of the organization needs to improve their policies regarding after sales service and the issues of product returning after the sales. The management if the organization should keep an eye on the quality control of the products as that can effectively build the reputation of the organization in the relatively unknown market of Australia. The business leaders of Amazon Australia can also effectively improve their social media and television campaigning in order to let the target customers know about their newly introduced services and the products. The managerial board of the organization can introduce new reward systems via social media platform in order to attract more individuals to visit their social media pages, and this can effectively increase their engagement with the target customer base trough the platform of social media.
Conclusion
Thus to conclude, it can be said that Amazon is a well established and reputed business organization that is operating in nearing one hundred countries and expanded their business in the market of Australia. To achieve success the management has categorized the target customers into two parts and they will be planning to improve their policies and services to capture the market to achieve the monopoly in the online retail business in Australia. The business leaders of Amazon Australia is planning to improve their relations with the target customers in order to get to know the requirements of them in order to maximize the productivity along with the profitability. Thus the management of Amazon Australia should stress on the factors like improving the relation with the target customers and by improvising the company policies and services to attract more customers and also to let people know about the services offered by the business organization.
References
O’Connor, T., 2017. Retail response. MHD Supply Chain Solutions, 47(4), p.38.
Schlagwein, D., Thorogood, A. and Willcocks, L.P., 2014. How Commonwealth Bank of Australia Gained Benefits Using a Standards-Based, Multi-Provider Cloud Model. MIS Quarterly Executive, 13(4).
Pollak, A., 2017. Crunch time for Aussie bank investors. Equity, 31(7), p.6.
Perera, T. and Reddy, W., 2017. Improving Australian Commercial Property Market Forecasting by Mapping Structural Changes in Built Environment. In AUBEA 2017 (pp. 87-100). Australasian Universities Building Education Association.
Wirl, F., 2017. Agency Model and Wholesale Pricing: Apple versus Amazon in the E-Book Market. International Journal of the Economics of Business, pp.1-22.
Leong, C.M.L., Pan, S.L., Newell, S. and Cui, L., 2016. The Emergence of Self-Organizing E-Commerce Ecosystems in Remote Villages of China: A Tale of Digital Empowerment for Rural Development. Mis Quarterly, 40(2), pp.475-484.
Rahayu, R. and Day, J., 2015. Determinant factors of e-commerce adoption by SMEs in developing country: evidence from Indonesia. Procedia-Social and Behavioral Sciences, 195, pp.142-150.
Cavusgil, S.T., Knight, G., Riesenberger, J.R., Rammal, H.G. and Rose, E.L., 2014. International business. Pearson Australia.
Hsu, M.Y.T., 2018. Cognitive systems research for neuromarketing assessment on evaluating consumer learning theory with fMRI: Comparing how two Word-Of-Mouth strategies affect the human brain differently after a product harm crisis. Cognitive Systems Research, 49, pp.49-64.
Li, D., Nagurney, A. and Yu, M., 2017. Consumer learning of product quality with time delay: Insights from spatial price equilibrium models with differentiated products. Omega.
Walker, S., 2017. Learning theory and behaviour modification. Routledge.
Ashley, C. and Tuten, T., 2015. Creative strategies in social media marketing: An exploratory study of branded social content and consumer engagement. Psychology & Marketing, 32(1), pp.15-27.
Wang, W.Y., Pauleen, D.J. and Zhang, T., 2016. How social media applications affect B2B communication and improve business performance in SMEs. Industrial Marketing Management, 54, pp.4-14.
Hudson, S., Roth, M.S., Madden, T.J. and Hudson, R., 2015. The effects of social media on emotions, brand relationship quality, and word of mouth: An empirical study of music festival attendees. Tourism Management, 47, pp.68-76.
Agnihotri, R., Dingus, R., Hu, M.Y. and Krush, M.T., 2016. Social media: Influencing customer satisfaction in B2B sales. Industrial Marketing Management, 53, pp.172-180.
Berger, J., 2014. Word of mouth and interpersonal communication: A review and directions for future research. Journal of Consumer Psychology, 24(4), pp.586-607.
Baker, A.M., Donthu, N. and Kumar, V., 2016. Investigating how word-of-mouth conversations about brands influence purchase and retransmission intentions. Journal of Marketing Research, 53(2), pp.225-239.
Eisingerich, A.B., Chun, H.H., Liu, Y., Jia, H.M. and Bell, S.J., 2015. Why recommend a brand face-to-face but not on Facebook? How word-of-mouth on online social sites differs from traditional word-of-mouth. Journal of Consumer Psychology, 25(1), pp.120-128.
Balaji, M.S., Khong, K.W. and Chong, A.Y.L., 2016. Determinants of negative word-of-mouth communication using social networking sites. Information & Management, 53(4), pp.528-540.
Ring, A., Tkaczynski, A. and Dolnicar, S., 2016. Word-of-mouth segments: online, offline, visual or verbal?. Journal of Travel Research, 55(4), pp.481-492.
Tigabu, A.D., Berkhout, F. and van Beukering, P., 2015. Technology innovation systems and technology diffusion: Adoption of bio-digestion in an emerging innovation system in Rwanda. Technological Forecasting and Social Change, 90, pp.318-330.
Wu, L. and Chiu, M.L., 2015. Organizational applications of IT innovation and firm’s competitive performance: A resource-based view and the innovation diffusion approach. Journal of Engineering and Technology Management, 35, pp.25-44.
De Vries, H., Bekkers, V. and Tummers, L., 2016. Innovation in the public sector: A systematic review and future research agenda. Public Administration, 94(1), pp.146-166.
Abedin, B., 2016. Diffusion of adoption of Facebook for customer relationship management in Australia: An exploratory study. Journal of Organizational and End User Computing (JOEUC), 28(1), pp.56-72.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
