AMAZON STRATEGIC PLAN
Strategic Management
Prepared By
Samah Bakr
Israa Gamal
Mohamed Foad
Walid Mohamed
Mohamed Mahmoud
Presented to
Dr. Ossama Mossallam
OCTOBER 12, 2021
AASTMT
Smart village
Content

Introduction

Mission

Vision

Strategy formulation and Situation Analysis
- Internal Strategic Factors
- External Strategic Factors
-
Internal Factor Evaluation Matrix
External Factor Evaluation Matrix
Competitive Profile Matrix
SWOT analysis
Strategic Position and Action Evaluation Matrix (SPACE)
Boston Consulting Group (BCG Matrix)
Internal External Matrix
Grand Strategy Matrix
Quantitative Strategic Planning Matrix (QSPM)
PESTEL analysis
-
Porter’s Five Forces Analysis of Amazon

Goals

Strategies

Objectives
Introduction
Amazon.com, Inc. is an American multinational conglomerate which focuses on ecommerce, cloud computing, digital streaming, and artificial intelligence. It is one of the Big
Five companies in the U.S. information technology industry, along with Apple, Microsoft,
Google and Facebook. The company has been referred to as "one of the most influential
economic and cultural forces in the world", as well as the world's most valuable brand.
Below is a complete strategic plan to Amazon, publisher will investigate many factors that
can affect the company and the most valuable strategies could strengthen its market
position.
Mission
“We strive to offer our customers through online and physical, focusing on the lowest
possible prices, the best available selection, and the utmost convenience”
Customers should expect services from Amazon that go beyond satisfying their needs,
according to the statement. It aims to provide the greatest deals to customers on three
shopping factors: price, variety, and personal satisfaction. Based on this, this statement has
the following components:

Affordable Prices
Amazon aspires to be a corporation that values its customers' spending. It achieves
this by offering the best pricing to its consumers without sacrificing the quality of the
items it sells.

Varied Selections
To meet this need in Amazon's mission statement, the company's management
expands the breadth of products and services available to customers. One of the
main reasons Amazon has grown in popularity as a platform where one can find
practically anything quickly and easily is because of the availability of these items. In
essence, there is no limit; the selection is unlimited.

Top Convenience
Amazon places a premium on the convenience of online shopping. It recognizes that
this is the best approach for clients to get whatever they desire, from the comfort of
their own homes. To add to how Amazon addresses this issue, the business works
with dependable partners to ship all of its customers' items quickly, regardless of
their location.
Vision
“We aim to be Earth’s most customer centric company. Our mission is to continually
raise the bar of the customer experience by using the internet and technology to help
consumers find, discover and buy anything, and empower businesses and content
creators to maximize their success.”
The company's vision statement reconfirms its goal of being a place where all customers
across the world feel happy and cared for in every manner.

Client-Driven Company
According to Amazon's corporate culture, the client comes first in the order of priority.
For example, as an indirect incentive for customer loyalty, the company integrates
periodic stunning deals and promotions as a sign of how much it aims to please its
customers.

Global Presence
Amazon, as an e-commerce company, aspires to have the greatest influence on the
global market. The company's strategic methods are directly linked to the
progressive expansion attempts that Amazon prioritizes. It explains why the company
uses the phrase 'be Earth's' as a reminder of the organization's desire for its impact
to be felt.
Strategy formulation and Situation Analysis
Stage 1: Analytical frame work stage
In this stage, input information will be summarize d and different matrices will be performed
to analyzing the current situation of Amazon either internally or externally.
Different tools will be generated in this stage:



IFE: Internal Factor Evaluation
EFE: External Factor Evaluation
CPM: Competitive Profile Matrix
In order to apply the above-mentioned tools, Internal and external factors that affect on
Amazon business will be formulated.
Amazon’s Strengths – Internal Strategic Factors

Strong and reputable brand name
As a global pioneer organization in e-commerce, it has a strong and valuable image
in market.

Brand position
Amazon is positioned as from the top retailers ($386,064 million revenue in 2020)
either in the US or globally specially in online shopping in three major key businesses
Amazon Marketplace, Amazon Web Services (AWS), and Amazon Prime.

Variety in offered product or services
Amazon vary its offering of products from books, music, tools, kitchen, electronics,
grocery, fashion, digital devices and many other services either for customers or for
other sellers such as audio and video streaming, web services, stock and fulfill orders
for traditional retailers.

customer-centric business
as it is part of amazon current mission, it always seeking for customer needs this
reflected on diverted portfolio of Amazon business.

Cost Leadership
Amazon always offered customer the lowest prices comparing to physical stores
beside offering free shipping in many times on a selected purchase.

Strong logistic ability
Amazon continuously improved its logistic abilities by investing in building fulfilment
centers and other facilities. By October 2019, Amazon operated 342 fulfilment
centers in 20 countries and 457 other materials handling facilities. Beside own an air
cargo hub in Kentucky and launch the service of Shipping with Amazon (SWA).

strong digital platform
Amazon developed a strong, attractive, secure and easy website with high quality of
customer service, lower cost and timely convenience to reach for all customers (365
days a year, 24 hrs. a day).

Differentiation and Innovation
Amazon always creates new ideas for the delivered services such as:
- Acquires warehouse robot specialist Kiva for $775 million to improve productivity.
- Delivering packages on Sundays.
- Introduces free two-hour delivery using Uber mobility model.
- Allows users to browse and purchase specific pages or chapters of a book online
- before physical publication.
- Producing digital devices as Kindle and Alexa.
- Fulfillment by Amazon for SMEs.
- Introducing Just Walk Out (JWO) and cashier-less in its physical stores.

Third party sellers
Which represents very important profit channel to Amazon with minimum effort.
Total Gross Merchandise Volume in 2018 ($'billions)
First-Party
Third-Party
116
123
Share of Physical GMV Sold by Third Party Sellers
2018

58%
Strong vision in acquiring and alliances of other businesses
Amazon performed many successful acquisitions for many companies along years
which reflected in more revenue and profit such as:
Toys "R" Us Alliance, Borders Group Alliance, Joyo.com acquire, Kiva Acquire,
Brilliance Audio acquire, acquired eero Wi-Fi systems, Zappos.com acquire,
Diapers.com acquire, Whole Foods Market acquire and many others.
Amazon’s weaknesses – Internal Strategic Factors

Easily business model
Online retail business model is a very easy and common in digital wold today.

diversification strategy (loss of competitive advantage)
Huge diversity in Amazon businesses rather than the core business (retailing books
online) does not allow it to focus on core business.

loosing profit margin due to shipping charge strategy
Amazon always strengthen its position by offering more benefits regarding the
shipping fees which reduces the profit margin.

Low margin business model
Amazon reported $386,064 million as a total revenue with net income of $21,331
million which represents low margin (around 5.5%).

Tax avoidance
As on March 2018, President Trump attacked Amazon by tweeting that the
company did not pay enough taxes and implied that he might use the power of the
presidency to intervene in the company’s success.

limited physical presence
An online shopping represents an advantage to Amazon as it can save a lot of
operating costs, but it prevents Amazon from tapping into markets where ecommerce is still an emerging trend.

Criticized Un-healthy work environment
the internal phone directory showed employees how to send confidential feedback to
each other’s bosses, one ex-employee recalled, “Nearly every person I worked with, I
saw cry at their desk.”, as many decried poor working conditions in the company’s
warehouses.

Focus on North US and Europe market
Amazon focus only in the US and Europe market rather than the emerging markets.

Focus on delivered price and due rather than product quality
Amazon always focusses on price and due time for delivering its product and did not
make a reference for product quality level.

Focus on expansion and revenues
Expansion and achieving high revenue are the major aim to Amazon rather that
profitability.
Amazon’s Opportunities – External Strategic Factors

Expansion into the emerging markets.
Amazon has a great opportunity to expand its existence outside the US market into
many emerging markets special with strategy of cost leadership.

Go green
Large segment today prefers green products, Amazon has a good opportunity to
attract customers who like to buy such products.

COVID-19 pandemic
The pandemic has led to exponential growth in specific sectors (especially online)
such as healthcare with consistent growth in FMCG and essential commodities.

Global growth in digital technology and devices
Mobile internet is valid in many countries in an easy way with rapid technological
developed devices.

Global interest and awareness of online shopping
Online shopping represents an attractive purchase model for large segments of
customers in global market.

Globalization
All the world becomes one global market, it represents a great opportunity to amazon
to enter and compete in new markets and gain more revenues.

Customer positive review
Online retailing experience depend on many factors such as customer service and
delivery but one of the most effective factors that affect on customer purchase
intention is the positive review on purchasing experience, Amazon has great
opportunity on such issue.

Encourage capital investment by many government
Specially in emerging countries, they have facilitated procedures to encourage
foreign investment, it would be a good chance to Amazon to invest in such countries.

Acquiring small local online retailers
In many countries there are many small online retailers has customer base locally, it
will be a great opportunity for Amazon to acquire and start from their ends.

Amazon image in emerging market
One of the most reputable retailers in the emerging markets, they consider it as a
giant in the retailing and online shopping, it will be a great competitive advantage in
these markets.
Amazon’s Threats – External Strategic Factors

Very complicated business
needs high inventory control and faces return problems.

Government regulations and taxation
As a result of expansion Amazon could affected by government regulations and
taxation, it could threaten the business proceedings of Amazon in some critical
countries.

Aggressive competition
With big retailers as Walmart and eBay, Video Streaming Service as Apple TV and
Netflix, logistics as UPS and FedEx and autonomous as Tesla.
Very aggressive competition with giants in their fields could be a great threat on
Amazon.

Low barrier to entry business
As many other companies uses Amazon business model specially in local emerging
markets as Jumia, Noon.

Economic Recession
Very important factor can affect Amazon sales in many countries as the expenditure
level becomes too low.

Lack of internet services in some emerging countries.

Quality control
As the third-party gross merchandise volume is exceeding 50% of sales and their
product quality is out of Amazon control.

Brand dilution Risk
Due to expansion in delivering services and selling a very wide range of products.

Credit purchase is low
In many emerging companies, this will make difficulties in payment and will affect the
online purchase.

Customers warry about their information security.
One of the important threats is the hacking of customers data, Amazon should take
the necessary actions to guarantee securing of customers data.
Internal Factor Evaluation Matrix
Key Internal Factors
Weight
Rating
Weighted
Score
0.03
0.03
0.1
0.1
0.05
0.07
0.05
0.05
0.01
0.04
3
3
4
4
4
4
3
4
3
3
0.09
0.09
0.4
0.4
0.2
0.28
0.15
0.2
0.03
0.12
Strength
Strong and reputable brand name
Brand position
Variety in offered product or services
Customer-centric business
Cost Leadership
Strong logistic ability
strong digital platform 
Differentiation and Innovation
Third party sellers
Strong vision in acquiring and alliances of other businesses
Key Internal Factors
Weight
Rating
0.02
0.04
0.05
0.04
0.08
0.02
0.07
0.04
0.06
0.05
1
1
2
2
1
2
2
1
2
2
2
Weighted
Score
Weaknesses
Easily business model
Diversification strategy (loss of competitive advantage)
Loosing profit margin due to shipping charge strategy
Low margin business model
Tax avoidance
Limited physical presence
Criticized Un-healthy work environment
Focus on North US and Europe market
Focus on delivered price and due rather than product quality
Focus on expansion and revenues
0.02
0.08
0.1
0.04
0.16
0.04
0.07
0.08
0.12
0.1
2.77
The Internal Factor Evaluation Matrix indicates a strong internal position to Amazon as the
total weighted score is above 2.5
External Factor Evaluation Matrix
Key External Factors
Weight
Rating
Weighted Score
0.07
0.04
0.05
0.07
0.05
0.03
0.1
0.04
0.05
0.04
4
3
4
4
3
3
4
4
3
4
0.28
0.12
0.2
0.28
0.15
0.09
0.4
0.16
0.15
0.16
Opportunities
Expansion into the emerging markets
Go green
COVID-19 pandemic
Global growth in digital technology and devices
Global interest and awareness of online shopping
Globalization
Customer positive review
Encourage capital investment by many government
Acquiring small local online retailers
Amazon image in emerging market
Key Internal Factors
Weight
Rating
Weighted Score
0.05
0.05
0.07
0.03
0.06
0.05
0.04
0.03
0.04
0.04
1
1
2
1
2
1
2
2
1
2
1
0.05
0.1
0.07
0.06
0.06
0.1
0.08
0.03
0.08
0.04
2.66
Threats
Very complicated business
Government regulations and taxation
Aggressive competition
Low barrier to entry business
Economic Recession
Lack of internet services in some emerging countries
Quality control
Brand dilution Risk
Credit purchase is low
Customers warry about their information security
The External Factor Evaluation Matrix indicates a strong external position to Amazon as the
total weighted score is above 2.5
Competitive Profile Matrix
Competitive Profile Matrix (CPM)
Amazon
Walmart
Critical Success Factors
Marketing
Brand Reputation
Location
Product Quality
Customer Service
Customer Loyalty
Product Range
Total Score
Weight Score
0.2
0.2
0.05
0.15
0.25
0.05
0.1
1
4
3
1
1
4
1
3
Weighted Score
Score
Weighted Score
Score
0.8
0.6
0.05
0.15
1
0.05
0.3
2.95
3
3
1
3
4
3
2
0.6
0.6
0.05
0.45
1
0.15
0.2
3.05
4
4
1
3
2
3
1
Apple
Weighted
Score
0.8
0.8
0.05
0.45
0.5
0.15
0.1
2.85
Stage 2: Matching stage
In this stage we will focus on generating feasible alternative strategies by aligning internal
and external factors using different tools such as SWOT, SPACE, BCG, IE matrix and Grand
strategy matrix.
Internal
SWOT analysis
Usually Positive
Usually Negative
Strengths
Weaknesses
-Strong and reputable brand name.
-Brand position.
-Variety in offered product or services.
-Customer-centric business.
-Cost Leadership.
-Strong logistic ability.
-strong digital platform. 
-Differentiation and Innovation.
-Third party sellers.
-Strong vision in acquiring and alliances of
other businesses.
External
Opportunities
-Expansion into the emerging markets.
-Go green.
-COVID-19 pandemic.
-Global growth in digital technology and devices.
-Global interest and awareness of online shopping.
-Globalization.
-Customer positive review.
-Encourage capital investment by many
Government.
-Acquiring small local online retailers.
-Amazon image in emerging market.
-Easily business model.
-Diversification strategy (loss of competitive advantage).
-Losing profit margin due to shipping charge strategy.
-Low margin business model.
-Tax avoidance.
-Limited physical presence.
-Criticized Un-healthy work environment.
-Focus on North US and Europe market.
-Focus on delivered price and due rather than product
quality.
-Focus on expansion and revenues.
Threats
-Very complicated business.
-Government regulations and taxation.
-Aggressive competition.
-Low barrier to entry business.
-Economic Recession.
-Lack of internet services in some emerging countries.
-Quality control.
-Brand dilution Risk.
-Credit purchase is low.
-Customers warry about their information security.
Strategic Position and Action Evaluation Matrix (SPACE)
Boston Consulting Group (BCG Matrix)
Internal External Matrix
Grand Strategy Matrix
Stage 3: Decision stage
In this stage, a Quantitative Strategic Planning Matrix (QSPM) technique will be used, it will
use input information from stage 1 to evaluate feasible alternative strategies in stage 2 on an
objective basis.
Quantitative Strategic Planning Matrix (QSPM)
Strategic Alternatives
Integration
Intensive Strategy
Strategy
Key External Factors
Weight
AS
TAS
AS
TAS
0.07
0.04
0.05
0.07
0.05
0.03
0.1
4
2
2
2
1
2
-
0.28
0.08
0.1
0.14
0.05
0.06
4
2
3
3
2
3
-
0.28
0.08
0.15
0.21
0.1
0.09
0.05
0.04
2
4
2
0.08
0.2
0.08
3
2
3
0.12
0.1
0.12
0.05
0.05
0.07
0.03
0.06
3
2
2
Opportunities
Expansion into the emerging markets
Go green
COVID-19 pandemic
Global growth in digital technology and devices
Global interest and awareness of online shopping
Globalization
Customer positive review
Encourage capital investment by many
government
Acquiring small local online retailers
Amazon image in emerging market
0.04
Key External Factors
Threats
Very complicated business
Government regulations and taxation
Aggressive competition
Low barrier to entry business
Economic Recession
Lack of internet services in some emerging
countries
Quality control
Brand dilution Risk
Credit purchase is low
Customers warry about their information security
Total
0.05
0.04
0.03
0.04
0.04
1
3
-
0.15
0.14
0.12
0.09
3
3
3
1
-
0.15
0.21
0.18
0.03
Strategic Alternatives
Integration
Intensive Strategy
Strategy
Key External Factors
Strength
Strong and reputable brand name
Brand position
Variety in offered product or services
Customer-centric business
Cost Leadership
Strong logistic ability
strong digital platform 
Differentiation and Innovation
Third party sellers
Strong vision in acquiring and alliances of other
businesses
0.03
0.03
0.1
0.1
0.05
0.07
0.05
0.05
0.01
0.04
1
2
1
1
1
1
3
-
0.03
4
0.16
0.2
0.1
0.05
0.07
0.05
0.15
3
3
3
3
3
3
3
-
0.09
1
0.04
0.3
0.3
0.15
0.21
0.15
0.15
Key External Factors
Weaknesses
Easily business model
Diversification strategy (loss of competitive
advantage)
Loosing profit margin due to shipping charge strategy
Low margin business model
Tax avoidance
Limited physical presence
Criticized Un-healthy work environment
Focus on North US and Europe market
Focus on delivered price and due rather than product
quality
Focus on expansion and revenues
Total
0.02
0.04
0.05
0.04
0.08
0.02
0.07
0.04
0.06
0.05
1
3
1
2
3
3
3
0.12
0.05
0.16
0.06
0.12
0.15
3.04
1
2
3
1
2
3
According to the Quantitative Strategic Planning Matrix (QSPM) and considering all the
relevant internal and external factors that could affect the strategic position, the Intensive
Strategy seems to be more attractive to Amazon.
0.04
0.1
0.24
0.02
0.08
0.15
3.84
PESTEL analysis of Amazon (Mega Environment)
During this part we will explore and spot the six different factors impact Amazon as political,
economic, social, technological, environmental, and legal factors. Those factors will impact
the strategic management and operational management decisions in Amazon.
Currently Amazon is the market leader in e-commerce business and all of those factors
obviously will impact Amazon business.

Political factors
Amazon is an American founded multinational company it’s headquarter located in
Washington, Amazon operates 13 country-specific sites, and offered Prime in nine of
them before adding India. Those Prime-eligible countries are the United States,
United Kingdom, Spain, Japan, Italy, Germany, France, Canada and Austria.
This is show how much the political factor for Amazon is very sensitive factor, it may
impact Amazon business directly, fortunately USA have a good relation with all of
those 13 country and this support Amazon for future growth and find out new
opportunities.
-

Political stability of developed countries, like USA, UK, Canada and European
countries (opportunity).
Governmental encourage e-commerce (opportunity & threat).
Increasing governmental efforts on information technology (opportunity).
Economic factors
Operating in different countries with different Economic positions makes Amazon
business operation is very hard and required more efforts for business operation
study.
-
Economic growth rates
Interest / exchange rates
Inflation.
As well as the Micro-economic and macro-economic factors, Micro-economic will formulate
the way how people plan to spend their incomes, Macro-economic for governments interest
rate control and taxation. Both impact the consumer behavior.
During Epidemic years, despite of high labor cost in USA and UK and change in taxation
Amazon profit an increase of 37%from the US$87.44 billion the company reported in the
fourth quarter of 2019 to reach US$119.45 billion in Q4 2020.
Overall result
-
Economic stability of developed markets, especially the U.S. and European
countries (opportunity).
Increasing disposable incomes in developing countries (opportunity).
Potential economic recession of China (threat).

Social factors
Social factor is very important in situational analysis, Amazon is an American
company and operation in multinational environment, should study and adapt the
strategic management on the social factor adaptation to meet the multinational
consumer aspect.
This is not easy for sure, to study different people and different nation social factors will
impact Amazon business. Simply we can come up by two observations as below:

Increasing consumerism in developing countries (opportunity).
Increasing online buying habits (opportunity).
Technological Factors
No doubt that nowadays a huge impact of new technology has a direct effect in all
business, especially the new technology of information communication technology
and e-commerce.
Factors importance in Amazon.com business can be formulated as:
-

High technological innovation rate (threat & opportunity).
Efficiencies of ICT (5G) (opportunity).
Cyber security issues (threat).
Environmental Factors
Amazon is one of the largest companies worldwide, it should carry over some
responsibility for the environmental impact on the world many aspect impact Amazon
for this part.
Amazon should run a waste management program and support eco-friendly
environment by support green energy which impact the energy consumption.
Meanwhile, Amazon should care about the sustainability of the business, higher
sustainability standards will support Amazon to improve the environmental impact and
enhance the image of the company as a market leader of e-commerce business.
Amazon shows the significance of a comprehensive corporate social responsibility strategy
to increase the company’s competence.
-
Support environmental programs CSR (opportunity).
business sustainability (opportunity).

Legal Factors
Amazon shall be impacted by different legal terms in different countries, e-commerce
business operations should adhere to legal requirements in many developed
countries.
This is enforced Amazon for some basic requirements of paying high attention to
consumer product safety and employment regulation.
Again, for this factor Amazon can take the advantage to play a vital role in cooperate
social responsibility.
On the other hand, the country openness or restriction on world trade (import/export)
will help Amazon expansion plans.
-
Develop product regulation (opportunity).
import and export regulations (opportunity).
Porter’s Five Forces Analysis of Amazon


Threat of new entrants – High
Amazon main business is for e-commerce, it’s fact we can consider it’s easy to start
an online retail and start an e-Commerce website and compile with Amazon, this is
all the time required a huge investment like in warehousing, marketing, logistics,
distribution and customer service.
-
Switching Costs – However it doesn’t require much investment to launch ecommerce business, but this will not be easy for any new entry to market as
Amazon invested a billions of dollars last years and built a strong customer
experience.
-
Economies of scale – Amazon is one of the biggest retailers worldwide now, so
they have a big advantage of economies of scale, almost 35% from online
purchase in USA 2021 is allocated to Amazon.com. But the existing of new
competitor will impact Amazon market share.
-
Customer Loyalty – Amazon is one of the old e-commerce retailers they had built
a strong customer relationship by main program’s to grantee customer loyalty,
meanwhile built a strong 24/7 customer service center helps Amazon user’s.
Bargaining power of buyers – High
It’s worldwide known that customers have a high bargaining power on e-commerce
business due to high competition, consumer are sensitive for prices all the time
looking for best price and best value with high recommendation for best quality from
consumer prospective.
Amazon are providing a wide range of quality products and brands with a minimum cost with
a unique consumer experience and consumer satisfaction with delivery on time different
services.
On the other hand, Consumer have a low bargaining power for the products with less
alternative options like Amazon web services. Amazon are focused to consumer satisfaction
on all products they are providing.

Threat of substitute – High
It’s clear that the substitutes are available in online and normal shops, Amazon are
not selling 100% of Amazon production products and it’s played the role of retailer so
it makes Amazon work very hard to maintain the consumer good experience
otherwise the consumer will turn around to substitutes on other competitive rates.

Bargaining power of suppliers – Moderate
It’s crystal clear that in the e-commerce business suppliers have more influence in
the business because without the main stream suppliers Amazon will not be able to
serve consumer, this is from the supply point of view. Another challenge will raise up
for maintaining the demand with a sustainable quality and attractive price.
2019, amazon shared a list of more than 1500 supplier name on its website. Amazon,
applied a strict rules and regulations to manage the suppliers, this is applied on different type
of suppliers (Small – Medium and large).
Amazon engaged the supplier to think forward integration with Amazon and be a main part
of its supply chain, Amazon provide the supplier and consumer a useful data for
consumption rate and consumer comments for the product.
High sales and more reachable and number of consumers, high competition of different
products, make Amazon have more power in this case over all the supplier.
I8Amazon third-party seller share 2007-2021

Competitive rivalry
Amazon are facing a high completion against strong competitors such as Walmart,
Flipkart, Alibaba, eBay, this is the business nature the rivalry in the online retail
business is very aggressive.
Nowadays, many start-up and small retailers launched their online services, even
small/medium brands are discussing the plan to shift from normal shops to online business.
Low switching cost and the availability of substitute’s apples more pressure on Amazon
because consumers can transfer from one to retailer to other at low cost.
All of those factors push Amazon to invest more amount of providing high-quality products
and services to its consumer and Amazon has consistently retained its position of being the
market leader of the e-commerce industry.
Goals
The company s objective is to become the best place to buy, find and discover any product
or service available online. Amazon.com will continue to enhance and broaden its brand
customer base and e-commerce expertise with the goal of creating customers preferred
online shopping destination in the United States and around the world.
Adapting customer-centric strategies where the company aims to offer convenient services
to customers.
Along with this, the key aim of the company is to be positioned as the most convenient
company with the best customer service platforms and low pricing strategies
Strategies
Grand Strategies
Recommend a strategy, there are clear and distinct opportunities for Amazon providing they
choose strategies wisely. The best strategy for the company is one that fits the models but is
also distinct enough, to recognize their unique position within business.
Amazon Company is a well-positioned to come up with and implement a strategic plan that
is meant to give returns as well as sustain the recommended growth in the economy.
It is expected that Amazon will make an effort to come up with a strategy that will enable
company development as well as product differentiation thus expanding the market share. It
also helps in achievement of brand loyalty for the long-term, through objectives
Achievement as it makes great promises to the customer that the product will be in the
market for as long as it’s needed. Amazon’s grand strategy is highly suited to achieve the
already set goals as well as market development. Amazon Company should use the strategy
of product differentiation that will help the company to build a larger brand and even wider
variety of products which is one of the many attractive features that Amazon offers. This
approach would make the products supplied by Amazon Company to be targeted to very
specific customers thus making them able to conquer given geographical regions with
people and specific characteristics.
Amazon Company is also a well-known company that has excellent operational strategies
that have helped the company to expand far and wide and able to compete with other
competitive firms that are in the industry and remain profitable as well.
Based on our situational analysis and deep study for the variable factors, we do recommend
implementing below strategies:

Intensive strategy
Amazon will focus on the strength and opportunities for internal and external environment
development as well as the focus for weakness and threats for the internal and external
environment.
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Market development
Amazon are capable to focus on the emerging market worldwide as Amazon
have a Strong and reputable brand name, Amazon also have the capability of
Variety in offered product or services.
Those are basic foundation for Amazon strengths will make the market
penetration task easier than other competitors.
Meanwhile, the strong vision in acquiring and alliances of other businesses, like
what happened in Egypt in 2021, Amazon acquired one of its competitors in the
Egyptian market Souq.com, one of the market leaders in Egyptian market on the
e-commerce business.
This plan should be empowered in the emerging market rather than start up in new
countries. Amazon shall increase the footprint on the markets by increasing the supply chain
value and sales persons.
Amazon shall dedicate an enough budget for marketing efforts and the use of celebrity for
the advertising. For sure Amazon will continue the consumer loyalty program and the
different suitable and adaptable promotions. The main focus is to increase the existing
markets share, this is not easy for sure.
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Product/Service development
Amazon have a very strong digital platform, our team will use the DSS and MIS
systems to navigate the consumers focus and analysis the sales volume, use the
benchmarking to evaluate the market consumption rate of the different product.
Amazon will focus on the products which still needed in the market and no
saturation level reported for those services or products.
Amazon shall continue investing in the logistics delivery scope, empower the
Amazon aircraft project for global computation and ship the products out of USA
to emerging markets, meanwhile solve the logistics and delivery cost by new
ideas by adding some service looks like Uber services.
Amazon shall heir stronger third party to strength the product and service
solutions with high quality.
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Market penetration
Amazon have a good footprint in the European market, by offering and market
strength on the green solutions which take care more for the global environment
and meet the developed country plan. This is a great opportunity for Amazon to
increase market share on its existing markets.
Customer-centric business is one of Amazon focal points to build a strong
relationship with customers, this will have a great impact of Amazon business.
Amazon have a strong Research and development team working day and night
to provide a qualified product for the consumers.
Amazon is considered one of the Cost leaders in e-commerce business globally
this will help amazon for increasing market share by delivering the products and
service on competitive prices.

Integration strategy
Amazon is one of the biggest e-commerce retailers, the relation and management of
suppliers and third party is the main objective and successful story writer in amazon
business, so Amazon shall apply the integration strategy in the four wings for business
growth.
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Backward integration
Amazon shall invest more efforts for supplier control especially for the highly
demand products, as well as the logistics service which effectively impact
Amazon brand image.
The use for technology innovation like IoT and 5G application will support the
expansion plan for Amazon and support the growth for its business.
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Forward integration
Amazon shall pay more attention of logistics service and continue the
performance enhancement on delivering systems to control the cost, it could be
done by acquiring local shipping agencies.
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Horizontal integration
Amazon also will apply a strategy of acquiring more companies in different
market and expand the business such as Pharmaceutical sector, healthy food
market, also space market for tourism, it will positively reflect on Amazon
expansion and market share.

Diversification strategies
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Concentric
Amazon shall increase the number of offered products on the online shop from
170,000 to 200,000 in 2022 with expansion plan by 10% for coming 3 years, this
is new challenge for Amazon.com to find the qualified suppliers and attract the
existing customers.
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Horizontal
Amazon plan to expand in product verities which are offered currently to
penetrate the market of pharmaceutical sector and the healthy food industry as
many consumers are focusing now.
Meanwhile the higher demand of green solutions and green environment
products in the developed countries, the sector of Eco-friendly products is a
green area need more development and investment.
All targeting consumers are using Amazon.com nowadays for normal purchase.
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Conglomerate
Amazon shall invest for new emerging sector is Space tourism for the high-level
consumer, this market will allow amazon to provide a unique service with NASA.
Amazon will invest with NASA for this business model development.
Generic Strategy
generic strategy is cost leadership in a broad market segmentation. Generic strategy is when
a company has a large market and it services a varied socioeconomic background. Amazon
has a very broad market segmentation, both global markets and broad range of products.
Their market segmentation is broad, but the socioeconomic background is also broad
making this a cost leadership generic strategy. This strategy is effective for Amazon even
though they have competitors, most of them cannot imitate the strategy that Amazon follows.
Amazon has high buyer interest because of the vast products and services they offer.
Amazon's generic strategy is cost leadership in a broad market segmentation, but the
company also uses differentiation. The company’s differentiation strategy is fast paced
delivery services and having more products and services than competitors. Another way that
Amazon will use differentiation is the cutting-edge technology that is used for both
consumers and producers. Amazon provides an online platform, with quick delivery and
nearly every product on the market. Amazon is more concerned about gaining market share
than profit, in order to achieve this, Amazon has had to balance financial and strategic
objective.
Colourful strategy ( purple strategy)
Amazon should apply purple strategy
Which is mix between bloody red and blue ocean strategy; Amazon keep a good
competition and it should be differentiated between its competitors to guarantee a good
market share and also it should focus on developing and improving itself.
It should focus on improving the shopping experience, enhancing the store, increasing
customer value, win more customers, making more offers and offering gifts for usual
customers, increasing customer loyalty, increasing advertising, applying free shipping to
attract more customers and entering new products and services to make diversification.
Objectives

Increase the sales by 2.5% in current emerging markets by each quarter and in
developed market by 1% in each quarter for financial year 2021-2022.

Increase the traffic of current website of current and new users by 3% in each
quarter.

Increase the revenue by 10% on coming year 2022.

Reduce the logistics cost in 2022 by 5%.

Spend 300 Million on R&D during 2022.