Value Chain Analysis Of Amazon

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1- Company Background
Amazon.com is one of the first major companies to sell goods over the Internet and has become a well-recognized name in the world. Amazon.com is an e-commerce company of America in Washington. Founded by Jeff Bezos in 1994 and started as an online bookstore, but because of its success, Amazon has diversified into other lines of products and services such as groceries, electronics and Merchant Programme. Amazon.com stock price has fluctuated in recent years from $ 105 in 1999 to $ 5 in 2001. Amazon.com has developed separate for Canada, UK, Germany, France, China and Japan sites. Amazon.com vision is to become (Amazon.com, 2007): "the largest selection of Earth and be the company's customer-focused Earth."
Amazon.com is
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They used the value chain model from Michael Porter’s book, “Competitive Advantage: Creating and Sustaining Superior Performance.” The value chain analysis undertaken examines the operational effectiveness of activities that enable Amazon.com to perform better than its competitors; i.e. the distinctive value chain activities that are difficult to imitate. Using the framework proposed by (Amit and Zott, 2001), this analysis focuses on “value creation” and “transaction cost economies”; where Amazon.com configures its value chain activities to create unique value for customers, reduce its costs of carrying out these activities and reduce the cost of its customers’…show more content…
143 million of these will be in Asia-Pacific. Second only to Western Europe with 185million. (Euro monitor International from national statistics). More Potential consumers for Amazon.com.
Social
• Increase in online social networking (e-Marketer online, 2008) Marketing needs to take advantage of this new channel.
• Product category risk and financial risk decrease online shopping (Sorce et al., 2005) Need to consider overcoming risks to increase users.
• Growth of internet from 2002 to 2007 is 244.7%.18.9% of world population use the internet (Internet World Stats, 2007) Opportunity to increase market share.
Technological
• There is an increase in broadcasting, information and telecommunications technologies for internet access. Increased frequency of use and sources (e.g. mobile devices, TV etc.) for internet access by online shoppers.
• Rapid development of ‘high-speed’ network services (e.g. broadband) increases usability of media-rich applications Media-rich contents are easily made available to online shoppers.

5- SWOT Analysis and TOWS Analysis
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