Summary of the Case Analysis
The case “Amazon’s Big Data Strategy” highlights the strategy implemented by the leading e-commerce company Amazon, which showed remarkable performance over the past two decades. Amazon was established by Jeffrey Bezos in the year 1994 and it started off as an online bookstore only. Today, it has diversified into a number of categories and National Retail Federation ranked Amazon among the top ten retailers in the US. Similarly, its subsidiary Zappos is also on the top ten list, which Amazon bought off in 2009 in a deal worth $1.2 bn. However, the case primarily focuses on the Amazon's strategy aligned with the ‘Big Data' of the customers that it maintains in order to provide exclusive service quality. It understood the imperativeness of big data at the start of the 21st century and emphasized on making use of gigantic databases of its customers that were shopping on its platform (McAfee et. al, 2012).
It helped Amazon to find and identify buying patterns and interests so that the firm could give those customers highly customized product suggestions and recommendations to its customers and enhances their shopping experience. Later on, the company also gave keys of its Big Data to other small e-commerce platforms against a commission fee. This strategy by Amazon was also useful in serving new customers. The strategy itself became a huge success and helped Amazon to create to what they call 360-degree customer profiles. This also helped the firm to create and target its individual customers with customized marketing messages with the help of its ‘Big Data'.
Analysis of Company’s Mission Statement
The mission statement of Amazon is as follows: “We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience” (Amazon, 2016). The three important components highlighted in this mission statement are the utmost convenience, best available selection, and the lowest possible prices. This mission statement covers almost all the important areas of what a customer is looking for while shopping on an e-commerce retail platform. This highlights the strategic direction of the company towards serving its customers. The only thing lacking from the mission statement is the nature of the business. The mission statement should be able to distinguish the industry or nature of business; however, Amazon has failed to incorporate its e-commerce nature of business into its mission statement. Apart from that, it's a reasonably good mission statement.
Analysis of Company’s Strategy
Amazon's strategy was to utilize its customer data also known as the ‘Big Data' to target them more effectively during their future purchases and to provide their experience by strategically providing each customer with customized recommendations. It also shared the ‘Big Data' platform to increase its earnings from the commission and also been able to find out the theft at the organizational level by making use of the big data resources. This greatly enhanced the customer experience while shopping on Amazon and also improved the customer relationship with the firm (Ward & Peppard, 2016). Similarly, Amazon also made use of its ‘Big Data’ to enhance the customer care service. The access to the profiles of customers and their past purchasing trends made it extremely trouble-free for the customer service representatives to provide solutions efficiently. Apparently, this strategy was appropriate as it reaped significant benefits for the firm. The strategy not only successful in improving the overall service quality of the firm, but also made it stand out from its competition.
SWOT Analysis & Findings
It can be concluded from the above SWOT analysis is that Amazon has a strong position in the market. Also, the e-commerce industry is on its take-off stage all around the World making it an attractive industry to work in. However, with its benefits, there are also some challenges that should be channeled properly on time in order for Amazon to sustain its market share and profitability in future.
Recommended Strategy
I would recommend International Expansion for Amazon as it is already capitalizing a lot on other factors such as diversification, and acquisitions etc. However, there is a huge room for Amazon to work on the strategy for expansion into more developed markets. Most of the countries are still young to the idea of e-commerce and Amazon can use its industry experience and financial muscle to enter these markets and fill that vacuum. Amazon is already operating in huge markets such as China and India, but it should not ignore other markets with great potential such as the Middle-eastern countries and other countries such as Indonesia, Pakistan, and Bangladesh.
Business Ethics Strategy used by the Company
The Business Ethics, Social Responsibility, and Environmental Sustainability are the imperative agendas for any business organization (Hartman, DesJardins & MacDonald, 2014). Amazon tries its best to keep all in check. Also, E-commerce is now becoming a very competitive industry and each e-commerce platform has to provide best prices and distinctive features to its buyers in order to capture more market share. Moreover, Amazon is leveraging its advanced big data sources to other smaller E-commerce channels. These companies do not have their own sources to implement big data strategy and therefore, Amazon is assisting them in building their business more quickly and also improving their customer experience as well. Amazon is also helping its stakeholders such as the 3rd party sellers to sell their products by utilizing its brand image and market reputation.
References
Amazon (2016) Official Website. About Amazon. Retrieved from https://www.amazon.com/p/feature/rzekmvyjojcp6uc?ref_=footer_aa on January 5, 2016
Hartman, L. P., DesJardins, J. R., & MacDonald, C. (2014). Business ethics: Decision making for personal integrity and social responsibility. McGraw-Hill. Retrieved from http://amberton.mylifeblue.com/media/Syllabi/Winter%202015/Graduate/RGS6036_E3.pdf on January 5, 2016
McAfee, A., Brynjolfsson, E., Davenport, T. H., Patil, D. J., & Barton, D. (2012). Big data. The management revolution. Harvard Bus Rev, 90(10), 61-67. Retrieved from http://www.rosebt.com/uploads/8/1/8/1/8181762/big_data_the_management_revolution.pdf on January 5, 2016
Reimers, I., & Waldfogel, J. (2014). Throwing the Books at Them: Amazon's Puzzling Long Run Pricing Strategy. Available at SSRN 2442747. Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2442747 on January 5, 2016
Ward, J., & Peppard, J. (2016). The Strategic Management of Information Systems: Building a Digital Strategy. John Wiley & Sons. Retrieved from http://samenvattingen.student.utwente.nl/images/c/cc/SMOI_2002_Samenvatting_Peppard.pdf on January 5, 2016
