Running Head: AMAZON.

COM BUSINESS FINAL 1

Amazon.com Business Final

Marlen Sierra

South Texas College

Dr. Eduardo Pastor Jr., M.B.A., J.D.

November 16,2018
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Amazon.com Business Final

I started hearing about Amazon several years ago, but I was not familiarized with what

they sold, and I was not interested in finding out. I would read on Facebook during the winter

months that my friends would post comments about shopping online and I thought it was a dumb

idea to buy things online to give as gifts. My idea of shopping was going store by store and

doing the shopping myself, not sitting in front of my desk, in the comfort of my home. I later

discovered that this crazy idea was being used by my own children when packages started

coming in the mail delivered to our doorstep. Who is buying stuff from Amazon? To what my

kids responded, everyone! Amazon was the new trend and I was not familiarized with it until

one day they sat me down in front of the computer and showed me what Amazon would offer. I

was amazed to see the movies section. I later discovered that Amazon Prime would allow me to

see so many different shows by season. This grabbed my attention and I started looking through

the history, just to find out my kids were buying so many cool items and I did not have to take

them to Wal-Mart or Target. That was the moment I fell in love with Amazon (Mercadal, 2016).

Business Goals

What started as an online bookstore in 1994 by Jeff Bezos has become the sensation

world-wide (Mercadal, 2016). The business goal for Bezos was not in attaining huge profits, but

in becoming the “…largest bookstore in the world” (Mercadal, 2016). The first years in business

constituted huge financial losses for Amazon, yet Bezos’ strategy was to reinvest. Bezos’ vision

in the online market drove him to leave his job at Wall Street and pursue his own dream. Dream

that would become a reality when Amazon started gaining profit and expanding its market into

Web Services. Later it became dominant in the e-Book market when it introduced Kindle. By

2016, Amazon was already counted 8th in the world’s largest retailers. In June 2017, Amazon
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acquired Whole Foods, a grocery company. It is presumed that this acquisition may be an attack

on Amazon’s biggest rival, Wal-Mart (Mercadal, 2016).

Amazon SWOT Analysis

Amazon has become one of the largest online vendors world-wide. Their supply network

has enabled them to serve customers world-wide and this has also caused other retailers to follow

in their steps. Many big retailers are now selling their products online and some of which are

only available online. During the SWOT Analysis from their own company profile we discover

that their strengths are being the largest retailer, a high revenue growth, and they have a very

strong distribution network. In their weaknesses they have been triggered with lawsuits because

of patent infringements, violation of privacy and the declining of liquidity. In their opportunity

analysis we see that there is a huge demand from cloud services which helps them expand their

web services. The increase of online retail sales in the US has also favored Amazon. Their

strategic investments help them grow. In the threat section they are faced with very string

completion, strong regulations and seasonal changes (Amazon, 2018).

Strategic Alliances

The collaboration between two firms is constituted as a “win-win” strategy. Amazon has

been contacted by Future Group CEO Kishore Biyani (Mukherjee, 2018). In an effort to join

forces and become allies in the food chain industry. This is a very good deal for Amazon, since

India does not allow foreign direct investments (Mukherjee, 2018). But in this case, Future

Group holds a foreign portfolio investor (FPI) with which if it joins forces with Amazon, this

will open doors for Amazon in India (Mukherjee, 2018). This is a crucial investment strategy for

Amazon since another one of its e-commerce competitors is Alibaba from China which is also

looking into a strategic alliance with Future Group CEO Kishore Biyani (Mukherjee, 2018).
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(Mukherjee, 2018). Another one of the companies from India who looked into Amazon for

strategic alliance was Mondelez International (Coyne, 2017). The Cadbury chocolate factory

aimed to join forces with Amazon to develop an online presence through the e-commerce and a

aiming to gain presence world-wide. Their ambition is to target US$1Billion dollar sales by

2020 and they chose Amazon.in to make this possible (Coyne, 2017).

3 Year Projected Sales

The projected revenues in billions for Amazon consist of Quarterly Statements. Quarter 1

for 2018 was $3.02 Billion US dollars, in Quarter 2 they reported revenue of $3.97 Billion, in

Quarter 3 there was a decrease in revenue which ended in $3.43 Billion. In this last quarter of

2018 there is projected increase of revenue of $6.92 Billion for the ending of 2018. This amount

is usually higher in the last quarter of the year because of Black Friday and all the holiday sales.

The following Graph gives an overlook of a slight increase in numbers for 2019, 2020, and 2021.
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Top Amazon Competitors

The Top competitors for Amazon.com include US giant Wal-Mart, holding 16% of the

online sales in the US and world-wide. Another giant competition for Amazon.com is Alibaba
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who is a Chinese company that sells many products like Amazon and is holding an 18% market

share with Amazon. Although Amazon holds 29% of the market share world-wide, other online

giants have been expanding their technologies to service more and more customers world-wide,

limiting Amazon’s full potential growth to stall and grow at a slower pace. In Europe, Amazon’s

competitor is OTTO. Due to OTTO’s alliance with many brands, their online sales constitute

80% of their business. Another Giant that is also great competition for Amazon is Priceline.

Their sales in travel related business has eventually made them become a competition in the e-
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commerce for Amazon (Bhasin, 2018).

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Conclusion

Amazon.com is an innovating company that took some time to get establish as a world-

wide company, but it has done an excellent job. It has opened up the sky for many other

companies to reach for the stars in the clouds. They demonstrated that innovation and

technology together with a little creativity can go a long way. It has also opened up the door to

many other business who have launched themselves into the internet to make business

(Mercadal, 2016).
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References
Amazon.com, Inc. SWOT Analysis. (2018). Amazon.Com, Inc. SWOT Analysis, 1–8. Retrieved

from https://ezproxy.southtexascollege.edu/login?

url=http://search.ebscohost.com/login.aspx?

direct=true&db=bth&AN=131310062&site=eds-live&scope=site

Amazon: Salesforce and AWS Expand Global Strategic Alliance to Accelerate Enterprises’

Digital Transformations. (2018). ENP Newswire. Retrieved from

https://ezproxy.southtexascollege.edu/login?url=http://search.ebscohost.com/login.aspx?

direct=true&db=edsgsc&AN=edsgcl.555706776&site=eds-live&scope=site

Bhasin, H. (2018, June 13). Top Amazon Competitors. Retrieved from Marketing 91:

https://www.marketing91.com/amazon-competitors/

Coyne, A. (2017, July 27). Mondelez and Amazon forge strategic alliance in India. Retrieved

from Just Food: https://www.just-food.com/news/mondelez-and-amazon-forge-strategic-

alliance-in-india_id137319.aspx

Mercadal, T., PhD. (2016). Amazon.com. Salem Press Encyclopedia. Retrieved from

https://ezproxy.southtexascollege.edu/login?url=http://search.ebscohost.com/login.aspx?

direct=true&db=ers&AN=89402254&site=eds-live&scope=s