Low Price Strategy
Strategic analysis is a procedure to analyse the business environment of the company. Strategic analysis helps an organisation to achieve the goal and objectives by identifying the consumer behaviour and the external environment of the market. It helps the company to analyse the resources to ensure the profitability competitiveness and growth of the company. In this report, Amazon Australia is taken into consideration to analyse the strategies. In this report, strategies of Amazon Australia are analysed which helps the company to gain the competitive advantage. In the last stage of the report, recommendations will be provided.
Amazon Australia is a US online retailer, it was founded in 1994. It started the business by selling books online after the great success; it expanded his business massively in the past years. In the recent years, it started operating in everything from its own branded tablets to the household product. Amazon Australia has its own websites for Australia; it is the second world largest company. The company earned the US $1 trillion with the help of 5666,000 employees (Amazon, 2018).
It is a price strategy which is low price offer by the company to the customer as compared to the other company to stimulate the demand and gain market share. It is one of three market strategies which can be easily adopted by any company. It is usually employed where the product has few competitive advantages (Alamdari, and Fagan, (2017). It has been seen that Amazon Australia offering the low prices to the customer to achieve the success and earn more revenue. The main focus of the company is based on customer experience by offering the low prices and provides the huge amount of products. The company sell many products online which attract the customer towards the goods and services. On the Website of the company, it is founded that there are a variety of products which has low prices as compared to the market prices; this attracts the customer towards the good and services. On some special occasions or festivals, it offers the high amount of discount which makes the customer greedy towards the goods and buys the products in bulk. This strategy of the company helps the company to achieve the higher name in the world and also achieves the customer loyalty (Rothaermel, 2015). There are very few a company those have been success in achieves the customer loyalty and awareness. Many cost leaders are relying on economies of scale to achieve the efficiency. Economies of scale have been created when the cost of offering goods and services decreases and the firm is able to provide the goods in large quantity. Amazon has less advertising expenses or travelling expense, people can easily buy products from its website. Thus, the company did not waste its time and money on travelling and advertisement. That is a reason behind the low price strategy of the company because the company has low cost (Nagle, and Müller, 2017).
Product Differentiation
The company can enjoy the high profits because it has a high market share in the market. It can be said that high-priced competitors will not want to compete directly with the company. The low-cost firm has an advantage that it can consume less time to influence the product.
It is a strategy which makes the Amazon Australia different from other online websites. Product differentiation is the process which makes the product differs as compared to the others (Devece, Palacios-Marqués, Galindo-Martín, and Llopis-Albert, 2017). The company makes the product more attractive to a particular target market, or target customer. The company makes its product different from the competitors as well as its own product. Amazon Australia sold goods at the higher amount with the little product differentiation but the competitors copied this strategy which creates the conflict between the companies (Banker, Mashruwala, and Tripathy, 2014). It can be said that the competitors fought for the cutthroat price war, but after this war Amazon constantly focuses on cost reduction by saving the cost and introduce the little changes in the precious products.
It is a marketing strategy in which the company main focus is given on its resources to enter or expand the business in the new market. This strategy is adopted by the company when the segment is set and the product is completely satisfying the customer needs. It is also one of the three generic strategies. It has been seen that Amazon Australia follows this strategy to expand the business at the higher level (Peng, 2017). Amazon started its business by selling the books and now it sells every product which is available in the market such as household, electronics and many more items. Amazon Australia expands its business by selling the new products to the customer at the lower prices. It also expands the business from one market to another market by building the customer loyalty. From the above analysis, it can be said that Amazon is the world second largest company online. Amazon Australia always focuses on customer satisfaction; it heard the customer complaints and takes as a recommendation and make sure that it did not repeat more with another customer. This quality of Amazon builds the strong relationship with the customer and attracts the more customers which increase the revenue and profit of the company. This strategy helps the company in expanding the business in the new market. Amazon Australia expands its business by merging with the different dealers to sells their products; it deals with every item which can easily available in the market. Focus strategy helps the company in expanding the business at the higher level and makes the brand world famous (Leonidou, et al., 2015).
Focus Strategy
Amazon focuses on the long-term goals; it does not focus on the short-term goals. It has been seen that Amazon focus on the next quarter which comes in the near future and this strategy of the company helps the company to gain an advantage for a long time. It long term strategy is helpful for the customer because its long-term strategy introduces the advance new products (Pascual, et al., 2002). This strategy helps the company to survive long in the market with the great success. A perfect example of this long-term strategy is that Amazon Web series, its start-up and developers expand the series to the millions of customers. All size companies use this series of AWS such as Interest, Johnson& Johnson, McDonald and many more companies. This startup is made by focusing on the long-term benefits for the customer and long-term success.
From the above analysis, it has been seen that the company follows the good strategies to achieve the success in the market. But still, it has to focus on the more strategies which help the company in attaining the high revenue.
Promotion strategy is a most important source for the company to build the customer relationship. The advertisement is the best way to introduce the product in the market and increase the customer in the market (Kim, Kim, Kim, and Magnini, 2016) Even the company has a strength that it can easily promote its product through online. Nowadays, every person is to use the social sites so that the company can easily promote its products on these sites by uploading the pictures, post and many others. It helps the company in promoting the product or increasing the customer for the high revenue (Huet, Frail, Lake, and Snyder, 2015).
It is a strategy which helps the company to expand the business at the higher level by focusing on resources. It has been seen that the company focus on its resources and expand the business at the higher level (Wensley, 2016). But it has to focus on the developing countries to expand the business at the international level. Amazon Australia has to the implement its business in the shops or makes the stores for kept the products for a long time. This strategy helps the company to earn more profit by providing the products to the customers (Baker, 2014).
Conclusion
From the above analysis, it has been concluded that Amazon Australia is the world largest companies in the online market. It has a high brand value which helps the company in earning the more revenue. It has been seen that the company follows the strategies which help the company in building the customer loyalty and attracts the more or more consumers towards the goods and services of the company. For achieving the success, the company offers the low prices as compared to the other companies to attract the more customers towards the goods and services. The company follows the strategies which make the services different from the others services. The company focus strategies help the company to improve the resources and to expand the business. The long-term strategy of the company is based on the long-term benefits. Although, the company has a good brand image it has to improve the resources and techniques to target the new customers. The company has to adopt the market and promotion strategy to expand the business at the higher level. To apply these strategies; the company will achieve success in the near future.
References
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Wensley, R., (2016) The basics of marketing strategy. In The marketing book (pp. 75-107). Routledge.
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