Amazon.com Inc. is an American E-Commerce company based in Seattle, Washington. It was founded in 1995 by Jeff Bezos and provides a platform upon which consumers can easily access and purchase books and other products such as CDs and DVDs online. The company was started to capitalize on the opportunity for online retailing as internet services grew across the global market. Amazon.com is one of the most cited companies with respect to business-to-customer e-commerce as its domain; amazon.com attracts over 600 million online customers annually (Shier 4). The company operates based on a mass marketing business model which aims to deliver products to customers anytime and in anyplace, using the internet and has an online community of followers created to allow people to write reviews and share them.
Mission, Vision, Core Values
Its mission, vision, and core values aim at enabling the company to be the leading and the largest online retailer globally as they guide the company’s goals and strategic decisions in conducting business.
Mission: The Company’s mission is to strive to offer its customers the lowest possible prices, the best available selection, and utmost convenience.
Vision: The Company’s vision is to be customer-centric in which customers are a priority and to offer the widest selection of products so that customers can find anything they may want to buy online.
Environmental Analysis
E-commerce industry has benefited immensely from the rapid advancements that continue to be witnessed in the field of technology. A general environment analysis of the e-commerce industry that Amazon.com operates in reveals political, economic, social, and technological factors that implicate the operations of the company. The company operates in a politically stable environment. However, the significantly politicized issues that e-commerce companies like Amazon.com face relate to factors such as government support for e-commerce which enables other companies to invest in online commerce and the increasing government efforts on internet security which drive the company to focus on privacy as it holds information from customers in its transactions. From an economic perspective, the company also operates in economically stable markets which increase the possibility of generating profits and growth. However, issues such as the recession in markets like China which the company aims to invest more in can adversely affect its financial performance. On the social domain, there is generally an increase in online buying habits which presents an opportunity for the company’s e-commerce business to thrive. However, factors related to wealth disparity limits the potential of growing its customer base because it does not favor the population that cannot access online platforms and this may stagnate its income. In the technology domain, advancements in technology could help the company improve its operations but also raises concerns about security and privacy thus the threat of online sabotage.
Internal and External Industry Trends
The e-commerce industry has continued to grow in both business-to-consumer and business-to-business sectors owing to technology-related innovations such as mobile applications and wireless technologies (Lee 47). Technological innovations have led to the entrance of numerous players seeking to capitalize on the online retail opportunities thus challenging giants like Amazon.com. The continued growth of technology innovations means that industry major players are able to develop strategies to stay competitive, shift marketing strategies, and enhance customer services to remain afloat.
Externally, factors such as cultural shifts and politics affect the e-commerce industry and have driven the industry towards customer consumption trends and expectations as well as political factors in relation to compliance with regulations. Cultural shifts have led to the shift to online purchases which is likely to increase the customer base of the company. There are also regulations in as far as online business is concerned with political players advocating for online privacy and safety in transactions.
Legal and Legislative Issues
There are various laws and legislations developed in the countries that Amazon.com operates in aimed at establishing a reasonable basis for ensuring transaction security while encouraging e-commerce firms to explore new ways of conducting business online. Amazon.com’s e-commerce activities are governed by legal and legislative issues closely related to contract law, privacy law, consumer protection, and tax and advertising laws. The scope of e-commerce law and legislation is to ensure transaction security, transparency, and effective rules of conduct (Voss et al. 105). The laws and legislations allow the company to develop norms within the basic framework and principles of legislation thus highlighting the essence of ensuring security and transparency are maintained as the company conducts its business.
Internal and External Technological Changes
Amazon.com exploits information technology with internal and external components that deliver digital content to the customers as well as managing physical product delivery. First, the company operates intranet which is an internal communications system that uses technology and internet standards. The intranet system is used to organize and coordinate internal communication efficiently while taking into account factors such as business mobility and distribution.
Amazon has built alliances with various tech-based companies to develop its platform to cater for the dynamic needs of the global market. Internally, the company has exploited technological changes to leverage information including purchasing habits records that has enabled the development of personalized web pages and targeted e-mails (Kangas 109). Technology changes have also enabled the company to apply differentiation and growth as it helps to focus on customers and suppliers because it has facilitated efficiency in terms of communication. Externally, automated interface and networking have been the main aspects that the company benefits from in respect to technological changes. The automated interface has enabled the company to achieve rapid purchase and delivery services and the networking facilitated by technology changes enabled the company to source products from various distributors and publishers even though it creates its own inventory (Amazon.com).
Labor Trends
In the recent years, companies have moved to secure low-cost labor as they seek to increase their profits. Amazon.com has chosen off-shore outsourcing over on-shore solutions due to the aspect of the cost of labor in the U.S. in respect to the trends in the information systems labor market in developed countries. This move also points to the trend towards increasingly globalized production of services in general and out-sourcing-related services. Factors such as the increased adoption and use of information technologies are the main force behind the trend considering that the internet has made it possible to source talent and ideas online from various geographical and demographical regions.
Social Concerns
A key factor that Amazon.com takes into consideration is the question of sustainability of the community and this can be seen in its sponsored customer-to-customer review platforms which develop social ties among different customers. The company’s sustainability goal is to ensure that members’ contributions are maintained as it conducts its business and running the business in an environmentally friendly way (Amazon.com). In addition, the selection of products from its wide range of products creates competition that results in significantly lower prices which are the issue that drives the company and ensures business continuity.
Objectives
The objective of the company relates to its vision of becoming more customer-centric, sales, and growth thus the need to develop measures of financial and non-financial performance. With respect to the aspect of globalization, the company seeks to increase its market share, strengthen its financial resources, and focus on innovation to improve productivity and customer satisfaction. The objectives are primarily strategic and orient towards generating benefits to support the company development through creativity in relation to improving process technologies, enhancing products, and entering new markets.
Financial
Amazon.com’s primary financial objective is long-term sustainable growth in free cash flow to fund maintenance and growth of the company and stretching its cash cycle to enhance its purchasing power in as far as production companies and distributors are concerned. The company also seeks to reduce its variable costs in regard to its marketing spending while at the same time curtailing its expensive growth plans.
Strategic Long-Short/Terms Goals
Amazon.com’s short term plan is to enhance its resilience as the market dynamics change over the years, particularly with respect to the global recessions and ensure profitability is retained. This means that the company aims at making proactive decisions with respect to the market changes that are dynamic in nature to remain competitive. The company’s long-term plan is to continuously integrate the website with the brick-and-mortar operations for diverse products, understand and adapt to dynamic market changes, and retain its employees to its service and enhance long-term stockholder value.
Works Cited
Amazon. Amazon.com, 2017, https://www.amazon.com/. Accessed 21 January 2017.
Kangas, Kalle, editor. Business Strategies for Information Technology Management. Idea Group Inc (IGI), 2003.
Lee, In, editor. Trends in E-Business, E-Services, and E-Commerce: Impact of technology on Goods, Services, and Business Transactions. IGI Global, 2013.
Shier, Erin. Online shopping spree in China. Alberta Canada Hong Kong Office, 2014.
Voss, W. Gregory, Katherine Woodcock, David Dumont, Nicholas D. Wells, Jonathan I. Exor, João Luís Traça, Bernardo Embry, and Fatima Khan. "Privacy, E-Commerce, and Data Security." The International Lawyer, vol. 46, no. 1, 2012, pp. 97-112.
