THE GROUP PRODUCT MANAGER,
AMAZON INC,
410 TERRY AVE. NORTH
SEATTLE, WA
98109-5210.
RE: BUSINESS PLAN
I at this moment write to you with the intention of bringing to your attention a research that I have conducted concerning you firm.
This work purposes to bring to your attention a concept that I firmly believe that if properly implemented and executed, will help improve the efficiency of your services and profitability of the firm.
I have had a keen interest in your marketing strategies, and that is the area where my research is based. It is not a secret that Amazon is one of the largest online distributors of good and services world over.
Recently, a friend of mine requested for a book with explicit details on what he wanted. The book was due in two days. However, upon delivery, he realized that the book was not exactly what he wanted.
Consequently, he had to choose whether to return it or keep it and make another requisition. He, therefore, loses a lot of time.
I looked at the situation and realized that his, was not an isolated scenario. Upon proper research, I have realized that a lot of people world over go through this pain.
In this plan, I have evaluated the possible challenge, and I have sought to find a suitable remedy to it. The problem is that in most cases, customers do not get an opportunity to view what they want, they just look at its descriptions, and once satisfied, they make an order.
I, therefore, want to present a plan that I believe will help reduce, or eliminate, the chances of returning goods to the stores. This reduction will help improve customer satisfaction and retain them in the ever co
Situation analysis.
An important part of the strategic planning process is to carry out environmental scans in order to determine the set of factors that influence the operational activities of an organization. As part of the environmental analysis, the planning team carried out both SWOT and PESTEL analyses.
In each and every year, Amazon has got thousands of returned good. Some are damaged while others fail to meet the specifications of the customers. My concern in this paper is not going to be the damaged good. No. I want to deal with the problem of those products that they return because they do not meet the specifications of customers.
On this matter, some cases come to mind. In March 2013, a computer programmer whose name is Nelson Greg purchased three hundred and forty-three items from Amazon. Nelson was never satisfied by some of the goods that were delivered to him, and he returned thirty-seven of them. One of the reasons that he gave for rejecting the goods was that they were never according to his specifications.
The company went ahead and punished him. His account was deregistered. Nelson had some money in his account, and he ended up losing that money. That must have been a terrible ordeal for him since had been a loyal customer of the firm for quite a long time. I believe the organization is also not happy to lose even a single client. Moreover, Nelson could have gone to court and started a legal battle that the management would not desire to have.
The Nelson case was not an isolated scenario. In November 2015, another client, Nigel Colledge from South Devon, had his account closed. Nigel had also spent a lot of money with the giant marketer. He had been a customer since 2006. In the year 2015 alone, the guy had bought a total of 256 items. This guy is a customer of good repute. The items that he returned were majorly electronics that had failed to meet his expectation. As a result of his actions, he also had his account revoked.
Finally, early this year, one more lost her membership after she had returned goods. Katy Kilmartin bought some one hundred and twelve rights of which 30 did not meet her standards. She decided to return the goods. Ordinarily, people do not accept products that they do not like. It is therefore very unclear why these customers lost their accounts. Moreover, they also lost the substantial amount of money that they would have spent elsewhere.
In light of the matters as mentioned earlier, I, therefore, bring up the idea of Amazon Television station. A television station that is entirely dedicated to the marketing of the goods that the company has on offer. The presence of television is going to ensure that buyers get to see exactly what the company has on offer without incurring any cost. At the moment, the videos that people in charge are showing are incapable of giving full information to the public. The implementation of this idea will profoundly reduce the rate at which the clients return goods.
SWOT analysis
I have developed a SWOT analysis of this project in a different power point presentation. Venturing into television may appear like an exciting idea. Like any other new idea, it is shrouded in uncertainty as to whether it will achieve its objective. The SWOT analysis comprises of internal (Strengths and Weaknesses, SW) and external (Opportunities and Threats, OP)
The strengths are the strong points of the Office that enable it to perform exceptionally, accomplishing its mission and achieving its strategic objectives while the weaknesses are the conditions that inhabit good performance. They represent the incapability of the Division to achieve its mandate effectively and realizing its strategic objectives.
Television already has a lot of players and the competition is at the fever pitch. For Amazon to get ahead way into the sector, they will have to pump in millions of dollars. This investment would, in turn, affect their profit margins. However, due to the strong base of suppliers they have, the company may tap into the loyalty and get revenues in advertising costs. The proceeds obtained are likely to boost the dwindling profitability of the organization.
The Opportunities are the external avenues that need to be tapped, representing the operational potentials that the Division should exploit in order to achieve its stated goals and objectives. The Office is also bound to threats, which represent external operational challenges which may hinder accomplishment of its mandate and strategic objectives during the plan period.
The project has got both opportunities and threats. However, a precise analysis of the situation indicates that the possibilities and the strengths by far outweigh the threats and weaknesses. Given the issues raised, the venture would be reasonable.
Opportunity Matrix
Below is a brief elaboration of the possibilities that are available concerning Television. The options ate also presented in power point.
Loyal customers; the company boast of millions of customers who are very faithful to the firm. There is, therefore, need for proper information to be given to them. The main reason for this project is to ensure that people, the world over, can see the goods they want to buy even before they see them. The interaction with customers is essential to ensure the qualities of the products are known to the customers.
Market growth; television will bring an opportunity to improve the client base of the company. It's notable that a lot of people are skeptical to buy items they have not seen. The fear is actualised by the fact that a lot of buyers have lost their membership when they return the items they are not satisfied with. With an introduction of Television, Customers may, without incurring costs, clearly see the things that they want.
Diversification; this idea gives the company an opportunity to venture into new territories. Traditionally, Amazon has concentrated on sales. However, with their entry into television, they get a chance to venture into marketing and research. This development may, in turn, generate millions of dollars that would increase their profitability.
Objectives of the proposal
This idea has got a lot of targets that it intends to achieve by 2017. Discussed below are some of the aims that it wants to accomplish;
Eliminate the chances of delivered goods being turned down by the recipients; the key goal that this project attempts to arrive at is the elimination of the likelihood of rejection of deliveries. Statistics indicate that thousands of goods are rejected by the same people who made orders and paid for them. Description becomes an issue. In circumstances where advertisements should happen on Television, customers may clearly describe what they saw.
Reduction of client revocation; my aim is to ensure that the customers do not lose their membership by returned goods. I have not with grave concern that in the majority of the cases where customers get themselves blocked from accessing their accounts, returning of goods has been the principal cause. If the number of revoked membership in the United States alone stood at about one thousand and five hundred in the year 2015, my aim is to reduce this figure by half at the end of the year two thousand and sixteen. The numbers would ultimately reduce to zero digits by the year two thousand and seventeen.
Retention of customer confidence to the services of the firm; in situations where people return delivered items, the trust issue will hit the public trust. The ability of the company to provide is in question. Once the capacity of the enterprise to offer is in question, the effects would be devastating.
Increased profit margins; the idea would help to bring in more customers. This development would be due to the advertisement costs that you will gain. Mostly, the firm would take up a lot of the advertising to its suppliers. The reason for this is because there is an already existing relationship between the company and the suppliers. It would, therefore, be easy to sway them to channel their advertising demands to Amazon. Of course, this advertising would be done at relatively lower costs than other people in the advertising industry.
The mission of the project.
I tend to ensure the comfort of the customers and the credibility of the company. The primary mission is to ensure that buyers do not experience the inconvenience of their supplies. At the same, the idea wants to endear itself to the public. You will guarantee customer satisfaction
The mission is therefore double sword, ensuring customer satisfaction and at the same time retaining them for the company.
Strategic approach
The strategic approach that I have developed in this work is to ensure maximum impact on the operations. This adjustment begins with an intense strategic research on intended aims and the targeted market. I look at the availability of resources, systems and television technological changes that can be effected to realize the maximum impact.
Monitoring and evaluation of market; the first key strategic approach that I develop in this idea is Monitoring and evaluation. This assessment allows the company to realize the effectiveness of the introduction of television in the marketing of its services. The evaluation would give the managers an opportunity to take stock of the areas that need to be adjusted. It would also be crucial in noting the responses of buyers and suppliers. The results would be used in future decision making and allowing desirable adjustments.
Research; it is always crucial that entrepreneurs engage in business research and find out better ways to improve their service delivery. It is prudent that the management team continuously involved in research activities to ensure that they understand the changing dynamics of the demands of customers. There are also products that the firm still has in stores in various parts or the world, yet they are no longer desirable. These only serve to increase losses since there is the low rate of stock turnover.
Networks and partnerships in the industry; networks and associations are an active ingredient in the success of this venture. In a situation where the firm finds itself unable to get the required money to invest in this activity, it will have to look for partners to carry out this massive investment.
Business Focus
The project has got one eye on maintaining the entrepreneurial culture, ethics, standard and objective of the organization. Profitability of the venture is significantly tested and proven. The venture intends to spread the tentacles of Amazon to other fields that may also increase its profitability.
While understanding how this programme is going to affect the activities of the firm, I have tried to look at some of the tools that may be used to gauge the business focus. I have discussed some of the tools below;
Supplier power; it is not easy to assume the power of suppliers in managing this king of enterprise. Moreover, this is a venture that is majorly dependent on distributors. We therefore have to give prominence to their influence. By recognizing their input, the project remains rightly within the demands of the company.
Buyer power; the enterprise has had a great relationship with its customers who majorly purchase goods online. This method of buying has become common in the market and it is therefore necessary to develop an idea that serves to maintain this kind of relationship. Besides, Amazon has had a great reputation for putting the interests of customers ahead of its business interests.
Competitive rivalry; Competition is ever getting hot in the market. In such scenarios of intense competition, it is necessary to come up with an adjustment to the manner in which we carry out business with view of outdoing the competitors. If competition is not encouraged, then innovation will not happen. Amazon must therefore embrace itself and prepare for a grueling competition.
Threat of substitution; the company must ensure that customers do not find a substitute. The only way to do this is to ensure that there are no better service providers in the system. An examination of trends today reveal that innovators are finding new ways to do things. The new developments pose serious existential threats to the ancient industries.
Threat of new entry; it is not surprising that firms are getting into the market and slashing away some of the loyal customers that the established guys control. This is because of the heavy investments that they make and also. The new entrants also bring with them newer ideas. Amazon has to find mechanisms to ensure that their area of control is not invaded and taken away from them.
Competitive anchor
As the situation is, there is no direct competitor to Amazon that has got a dedicated channel for marketing the products of their customers. Furthermore, the organizations do not sell the products. Each member, therefore, markets its products. If this you change this situation, there would be an apparent paradigm shift in the manner of conducting the business of the firms. This development would put the company far ahead of the lot.
Units of competitive advantage
There are small components in this idea that would make it more competitively advantaged ahead of the others. I have discussed some of these units below;
Advanced technology in modern times; the organization already has a properly established technical know-how. The next idea is not to acquire new technology but to just use the already existing one to its advantage.
Existing customer base; due to the strong presence that Amazon has, it can utilize it to its advantage. For instance, the account holders are so many, and they would keep their eyes open when the organization is carrying out advertisements.
Resource requirements
Set-up costs; the firm would require finances to acquire broadcasting materials and license fees. The exact costs of equipment will be expensive but within the reach of the enterprise. These costs could even be made affordable in collaboration with other interested players.
Human capital requirements; the project would require the active presence of skilled personnel ranging from information technology experts, journalists and other ordinary staff members. However, since some departments are already in existence, the company would not be obligated to recruit.
Financial profile
This following is a brief illustration of the costs to be incurred and the expected turnovers. These figures are not absolute but are adjustable with the ever-changing market dynamics. Note: These figures only relate to the proposed television and do not include other activities of Amazon for the initial year.
I note that for the initial year, the profit margins may be slight due to slow response from customers. This value is expected to keep swelling as the activities progress.
Conclusion
Finally, I would like to suggest that the firm adopts this idea of coming up with the television channel that you solely dedicate to marketing the products that it has in the stores.
The following are some of the expected outcomes;
Improved customer satisfaction; since the new changes brought will bring more in formation to the customers, it will be easy for them to relate very well with the management. In addition to that, the television programs being aired may show how some items are being used. This development would be an added advantage to the subscribers of the firm.
Reduced number of goods being returned; the issue of goods being returned forms the background of this project. A lot of customers usually go through a lot of pain while trying to get the goods that they ordered for. In most times, the process is tedious. A lot of resources are also consumed while trying to deliver new goods. By this time, the goods could be of no use to the applicant. Worse is that some people lose their membership in circumstances that are not very clear. In this case, there will be massive losses of revenue on the side of the company. If the television is adopted, revenues may be maintained. In fact they will greatly increase.
Increased revenues from increased activities; as discussed above, revenues will improve. This time however, the revenues will increase, not because customers have been retained but because of the advertising revenues that the company will collect.
Retention of clients since you will be reducing cancellation of memberships; it will be easy to relate with customers due to reduced confusion on the described goods. There will be no need to deregister customers.
Competitive advantage; this plan, if implemented, will keep the firm ahead of the rest in terms of competition.
