Amazon Chapter 10 Study Guide

Amazon is an electronic commerce company. Amazon was founded in 1994 by Jeff Bezos who is still acting CEO of Amazon. Its headquarters is based in the Seattle, Washington. Amazon has expanded its reach from the United States to all over the world. Amazon has separate retail sites, and distribution centers in the United Kingdom,France, Italy, Spain, China, and Brazil. Amazon sells everything from books, houseware, electronics, and clothing. In the recent years Amazon has expanded into the world of live streaming music, television shows and movies. Amazon creates its own consumer products like Amazon Kindle, or Amazon FireTV and its new product Echo.

Amazon.com has successfully managed to make its customers to feel that anything they could possibly want could be found on their website. Additionally, its products are marketed at a competitive price. Another important factor is their speedy delivery with their usage of UPS and FedEx (United States) and Royal Mail (United Kingdom). The company also caters for people that prefer online shopping with extra services such as Amazon Prime - a service with a yearly payment, customers are eligible for free next day delivery. Even though Amazon.com is known to be an online seller of most things, it still excels in its original market of book selling. Evidence of such is

Luckily for Amazon.com, this company is one the largest retail sellers in the online world. Amazon is a company with a single enterprise that has risen to the top of the Most Innovative Companies List. It has been increased to this fortitude due to this company’s innovative ideas and the ideas for growth for their consumers as well. As technology had changed, so did Amazon by offering Prime which was a membership that could be purchased to allow the consumer to acquire items faster and receive the products more quickly.

The key to successful pricing is to match the product with the consumer's perception of value.

Amazon.com, Inc., on May 28, 1996, started offering a range of products and services through on-line webpages. This new company began to offer products including merchandise and content that was purchased for resale from multiple vendors and sellers ranging from lots of third-party ways. The Amazon.com business has three different segments within its operating environment: Amazon Web Services, North America, and International make up the operating areas. The North American area for Amazon has segments that focus on the sales from retailers of consumer items or product from sellers through its website Amazon.com.

Amazon is the world’s largest online retailer that was launched in 1995 (Rouse, 2014). Amazon was mainly a book selling company that has enlarged its’ business by selling a variety of goods. The company sells all types of technology devices such as cell phones, games, televisions, movies, cameras, computers,

‘We believe that the principal competitive factors in our retail businesses include selection, price, and convenience, including fast and reliable fulfilment. Additional competitive factors for our seller and enterprise services include the quality, speed, and reliability of our services and tools, as well as customers’ ability and willingness to change business practices’ (Amazon10-K report 2015).

Headquartered in Settle, Washington DC, Amazon.com is a cloud computing electronic and commerce company (Amazon, 2016). The company is one of the largest internet based retailers both in the US and globally based on total sales and market capitalization. The company does a majority of its business through online retail websites throughout the United States and with more that ten countries throughout World. In 2015, Amazon overtook Wal-Mart to become the most valuable retailer by market capitalization.

Amazon is an online retailer focused on selection, price and convenience. Incorporated in May 1996, Amazon.com offers programs that allow sellers to sell products on the website and have the fulfillment performed by the seller. In addition to the online marketplace, Amazon also manufactures and sells Kindle devices. Through the different programs offered by Amazon, the company has the edge over their competitors. They are able to secure the lowest price, fastest shipping and offer incentives to the customer, such as Amazon Prime (Amazon, 2014).

The definition of Premium pricing strategy is, using a high price where there is uniqueness about the product or service. This approach is used where a substantial competitive advantage exists. Such high prices are charge for luxuries, free delivery-pick- up service, service quality, special chemical free products and prestigious presentation.

Amazon is an American commerce company based in Seattle, Washington, USA. The company used to be only a bookstore, but now it diversified into difference type of products. The goal of Amazon is to provide one stop shop experience where the customer can find everything on Amazon as earth’s biggest selection (Warman 2012). Amazon operates as a pure internet retailers that does not have retail store at all while the delivery will be done through Amazon’s networks of distribution centres. This operation makes the company is able to provide wider range of goods and lower cost of products with high quality. Moreover, it is also increase customer satisfaction as it supports customer convenience.

Amazon.com, Inc. (Amazon.com), incorporated on May 28, 1996, is an American electronic commerce company with headquarters in Seattle, Washington and is the largest Internet-based retailer in the United States (Ungar, 2014). Amazon.com started as an online bookstore, but soon diversified, selling DVDs, Blu-rays, CDs, video downloads/ streaming, MP3 downloads/streaming, software, video games, electronics, apparel, furniture, food, toys and jewelry (Ungar, 2014). The company also produces consumer electronics—notably, Amazon Kindle e-book readers, Fire tablets, Fire TV and Fire Phone — and is a major provider of cloud computing services (Ungar, 2014).

Amazon strives in a rapidly evolving and intensely competitive industry. Amazon competitors include publishers, vendors, distributors, manufacturers, physical world retailers and producers. Other competitors include media companies, web portals, shopping websites, online and mobile e-commerce sites, web search engines, and social networks, either directly or in collaboration with other retailers. Any company that provides e-commerce services, including website development, fulfillment, customer service, and payment processing is considered as a competitor by Amazon. Even Yahoo Inc. is also part of these services now with its new framework for providing easy e-commerce website development and payment processing services. Additional competitors include companies that provide information storage or computing services or products, services related to Cloud Computing, including infrastructure and other web services, companies that design, develop, market, or sell consumer electronics, telecommunication, and electronic devices. The competitive factors in retail businesses include selection, price, convenience, fast and reliable fulfillment. Additional competitive factors for Amazon seller and enterprise services include the quality, speed, and reliability of our services and tools. Many of the current

Price interacts with all other elements of the marketing mix to determine the effectiveness of each and of the whole. The objectives that guide pricing strategy should be a subset of the objectives that guide overall marketing strategy. Thus, it is probably wrong to view price as an independent element of marketing strategy or to assert that price, by itself, is a central element in the marketing mix.” (Webster, 1979)

Price, which is one of the most important elements of the marketing mix, can be difficult to get right. Pricing too high, or low, can negatively impact on customer satisfaction and revenue. Adopting a pricing strategy is necessary to achieve desired sales objectives (Chan & Wong 2005).