Organizational Description – Amazon
E-commerce is the second largest market in Asia Pacific region with the expected market to grow by $24 million by 2018. More than 69% of the Australian population buys the products digitally. With more than 7,630,000 Australian population almost 40% populations order product in every four week. Amazon.com is one of the largest market players in the online marketing. They are known for their quick logistics process. The customers do not have to wait for a week for their products. Their products are cheap and affordable for the customers and the company aims to associate with their customer for long run. The objective of this paper is to analyze Amazon and its operating environment from a marketing perspective. Literature suggests that different organizations can have different orientation or different perspective towards marketing (Erevelles & Fukawa, 2016). For example, some organizations have market orientation and some have product, production or sales orientation. Amazon is known for using the market the market orientation towards marketing. The orientation map that shows different types of orientation and the positioning of Amazon on that map can be shown as:
Amazon.com is the largest e-retailer in the world. The company was founded by Jeff Bezos on 1994. The companies vision statement focuses of the future of global dominance of online retailer companies. However, the companies mission statement focuses on the high quality and effective service.
Amazon’s Vision statement is “ To be Earth’s most customer-centric company where customers can find discover anything they might want to buy online.” The statement clearly indicates the aim of the organization of becoming the best e-commerce retailer in the world. The statement has emphasized on three major things – Global reach, Customer prioritization and widest selection of product. The mission statement of Amazon is “ We Strive to offer our customers the lowest possible prices, the best available selection and the utmost convenience.” The statement focuses on the attractive e-commerce service to satisfy customer’s need. The statement emphasizes on three major things- Low pricing, Best Selection or varied range and convenience (Erevelles & Fukawa, 2016).
It is one the largest Internet based retailer in the world by the total sales and capitalization. Amazon was originally founded in USA, since then it has expended its operation across the world (Bensinger & Morris, 2014). In most of the regions, Amazon has dominance in e-commerce retail and it is expected that Amazon would continue to grow its scale in different parts of the world.
Analysis of 5 C’s – Amazon.com
The marketing mix is defined as the process of placing the product at the correct price, place and time. The marketing mix is the combination of the elements that when put together, it creates the foundation of the business, missing out any element can result into the product failure.
The situational analysis can be one of marketing mix 5C. There are other tools that are present for the market analysis such as SWOT analysis and Porter Five Force analysis. The 5C’s concept analyzes the internal and external environment. This helps the organization to understand their customers and the capability to serve them better.
Customers: The demand of customer varies accordingly. A company needs to understand the customer wants and needs and work on it to fulfill their demand. The company should understand their potential market size and growth. The company should also have the understand of the change in desire, needs and wants of customer and buying behaviour of the customers.
Amazon has a customer from the age 14 to old age. The basic demand of the customers can be fulfilled easily.
Company: The companies should create their brand value or image irrespective the size of the company. By building the brand image the company will be able to grow its customer loyalty and help them in brand re-call. The company needs to assess the need and understand the requirement of the customer and should change according to their needs.
Amazon has always updated their website according to the recent trend that are running in the market. They have also assessed the needs to book readers and launched their product Amazon Kindle.
Competitors: This analysis will give details about the competitors that are present in the market. The competitor analysis should focus on three things- identify the competitors, identify the product line that competitors offer and threats that competitors might create in the future. This analysis will help the company to focus in increasing their market share and serve their customer better.
There are several competitors of the Amazon that are present in the market such as Harvey Norman, Myer and JB Hi-Fi. Amazon always stand out due to their customer services.
Collaborators: Collaborators are the one who show their interests in the growth of the company and are the company is willing to share their profits with their collaborators. Identifying the correct collaborators is the most important as they help the company to discover the untouched opportunities that company is aware of. Collaborators can be the suppliers, distributers and alliances to the customers.
Amazon Collaborators can be from the delivery boy to management and customers.
Context or Climate: The context or climate analysis means the analysis of external environment. This analysis is often done by PESTLE tool. The PESTLE tool helps organizations to study and analyze the external factors like political, social, etc. (Ramjawan,2011).
Market intelligence is used to access the market entry opportunities to formulate the market development plans and penetration strategies. It is a tool which is important for any organization. It helps in assessing the competitive advantage, need assessments as well as their market positioning. The Market Intelligence uses multiple sources of information that’s helps in creating the broader picture of company’s existing market, customers, problems, competition and growth market for new products or services (Jamil 2013 pp 463-472).
Market Intelligence also helps in updating the market trends and new business function that’s happening with their competitors.
Market Intelligence answers the question related to current and potential market. The questions that are addressed are:
- How resource allocation should be done?
- Is there any pattern that customers buy products?
- Which market should the company enter next?
- What other products can be cross marketed to existing customers.
- How demographic segmentation helps in understanding their buying behaviour?
There are certain tools that are available in the market to help in market intelligence analysis (Durmu?o?lu & Barczak, 2011 ; pp 321-330).
Market research is a tool which is important for all the business. Statics of research analysis helps the organization to take important decision about the company related to the business. It helps the organization to understand the market trends, customers and their needs as well as their competitors’ insights (Chen,Chiang & Storey, 2012 pp 1165-1188).
Amazon.com uses market intelligence to assess the need of the market. In 2017, Amazon is penetrating into the retail market in Australia. Amazon understood that there is a tremendous need for e-book as Amazon was selling high number of book online. The company initially assessed the market of readers and their frequency of their buying books. Then it launched the Amazon Kindle which is an e-book reading device where people can buy and read books on the device. E-books were handy, easy to carry and affordable for all the books readers. It helped them to have a competitive advantage among all the other brands. As of now, Kindle comes various models and prices so that consumers can buy according to their income level (Hennig-Thurau & Hofacker, 2013).
In a nut-shell it can be said that Amazon uses both internal and external sources to keep a watch over the market. The company conducts various kinds of surveys that are used to check the sentiments of end consumers in the market.
It would be correct to say that segmentation, targeting and positioning are the most important steps for any marketing plan. It is important that segmentation, targeting and positioning, should resonate well with the overall marketing mix of organization (kantor & Streitfeld, 2015). Segmentation, targeting and positioning can be explained in a three-stage process.
- Determine the interest of customers
- Select the potential customers from the audience to serve them
- Implement the strategies to promote the brand of product or services to the target audience.
The positioning of the brand can be done through the marketing mix concept i.e 4P’s or 7P’s concept. Segmentation also includes to find out what kind of customers exist with different needs.
The market can be approached in three ways:
- Undifferentiated Strategy:This strategy is used when all the customers are treated as same. The product or the service is a standard one and company doesn’t make any effort to satisfy the particular group of people. Also, the competitors that are available in the market do not provide the number of feature that the product or service is providing.
- Concentrated Strategy:In this strategy company focuses on specific group of consumers leaving other segments for the competitors.
- Differentiated Strategy: In the strategy, the companies usually have different strategies for different group of people.
Segmentation can be of several kinds such as:
- Demographic segmentation– In this type of segmentation people are segmented according to the regions and the lifestyles of the people will vary from region to region.
- Age– The need of every person will vary according to their age.
- Income– Income is the biggest factor which decides what product the consumer will buy.
- Behavior– The psychology of every consumer is different which decides what a consumer will buy.
- Gender- The need or requirement of a men and women will be different, so the product will be different for both the genders (Klaus, 2013).
Amazon.com is an online e-commerce website where the customer can buy any product online and they will be delivered to their doorstep. On Amazon, the products are varied from kids clothing or essentials to basic need of any consumers are listed on Amazon. The total population of Australia is 7,630,000 with the age above 14 and according to the survey more than 14% of the consumers order one or more product online in every four weeks. Therefore, here the segmentation of the consumers can done according to age and income. Since, the consumers above the age 14 are allowed to buy products online. The Income level of the consumers will decide in which income level a consumer will fall and what will the consumer buy (Dibb 2010).
The Marketing mix is a marketing tool which is used by the firms to determine the products, service and the brand offerings. The marketing mix tool developed in 1960s by E.Jerome McCarthy. The 4P’s of marketing are Product, Price, Place and Promotions.
By 1981, the marketer thought of extending the marketing mix tools therefore it includes products as a service and not ant physical things. This led to develop the 7P’s of marketing. The 7P’s of marketing are: Product, Place, Price, Promotion, People, Process and Physical Evidence (Ferreira, 2016).
he 7P’s of marketing. The 7P’s of marketing are: Product, Place, Price, Promotion, People, Process and Physical Evidence.
Product: The item which is being sold by the firm and fulfills the need of the consumer.
There are varied numbers of Products that are available on Amazon.com which can be use by the consumers of different segments. The products are available for kids as well as for adults and old age. This online portal sees the market of total $4 million in Australia.
Place: The Products should be easily accessible to the consumers. The mode of availability can vary and it depends on company strategy.
Amazon is an e-commerce portal and all the products that can fulfill the consumers requirement are just a click away.
Price: The amount that a consumer is willing to pay for any product is known as price. The price of any product should represent the good value for money.
The prices that are quoted for a product on Amazon are quite affordable. So the consumers can buy the product accordingly. Amazon doesn’t try to maximize their profits or their bottom line. Their aim is to have customers for long term.
Promotion: It can be defined that how an organization is able to convey the message about the brand and product to the consumers.
Amazon usually runs campaign, discounts, sales and several advertisements to create awareness about their brand and products (Ritala & Golnam, 2014).
People: The people related to an organization come under people. This includes upper management as well as the employee of an organization. Having right people in the company is important as they are one of the offerings as product or service. Amazon’s employees are enthusiastic about their brand and work (Erevelles & Fukawa, 2016).
Process: The delivery of the services which is offered to the consumers and how effectively these services are present usually comes under the process.
Amazon is known for its quick logistics turnaround. Their process is smooth right from ordering the products to delivering the same.
Physical Evidence: Anything which includes the physical elements of any company comes under the physical evidence. This can include the ID cards, uniforms for the organization.
Amazon has a strong physical evidence of their company. Every delivery person wears their uniform while delivering the products (Akroush, 2011).
Conclusion
Amazon the web services which was launched in Australia in 2012 and they instantly captured the whole market of e-commerce. It is expected that the market will grow by $24 million by 2018. Amazon launched its Kindle store in 2013 and currently has employed almost 1000 people of the country. Amazon holds all kinds of product which helps the customer of fulfill their needs and requirements. The Prices of the products are low priced and is known for their quick logistics process. Amazon is now entering the retail market and hoping to provide more number of jobs to the people. With the above discussion it can be said that Amazon would continue to do great in the e-commerce business. It is important that the company must continue to focus on innovation to keep its leadership position in the e-commerce industry.
Reference
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