Diane Popescu 1043410 Master in consultancy & Entrepreneurship March 2022 A VRIO analysis of Amazon and it’s competitive advantage position Who is Amazon? Amazon is a company that started in 1994 as a bookstore and then expanded to sell almost anything, from cosmetics to electronics and food. As of 1999 became the biggest online selling platform and is now one of the largest companies according to their revenue in the US. As of 2017 they also expanded with physical stores and then later also introduced Amazon Prime subscription that was a game changer for the company. Amazon Prime strengthened the loyalty of existing customers and also brought new ones. Amazon brought the “frustration free” packaging to the market. In 2007 they started selling “Kindle”, a device created to enhance the platform’s e-book sales, and later continuing with Ai development and Alexa, a home smart device that made Amazon the 3rd largest smart device seller worldwide. The following paper will detect and state the companies resources, capabilities and then recognize the core competencies which will then be analyzed through the VRIO framework determine whether the company has competitive advantage in the market or not. Amazon Resources The company’s resources can be categorized into physical tangible and intangible assets and resources and organizational capabilities. Tangible resources include “Fullfilment Centers” which are essentially warehouses positioned close to airports that make them easily accessible. Company has a huge market capitalization and represents one of the largest in the world at the moment, 5th to be exact and with an astonishing 1.641 Trilion Dollars. They are the creators of the “frustration free packaging”, an improved package that is both sustainable and ergonomic. Intangible resources include very good staff, some of which had worked for competition before or had previously worked in world leading companies where they made a mark on their development such as PointCast.Inc &Network, Oracle Applications, Procter Gamble and Neteflix. Another resource are the key partners such as logistic companies, authors and publishing companies. Amazon has been around since 1994 and has since built a reputation that stands for great customer service, friendliness and trustworthiness, thus establishing a worldwide known brand presence. Other intangible resources are the 2936 patents owned by Amazon by 2019 such as the “1-Click” order to simplify customer experience and other such concepts of technological nature. Huge investments made by the company in the technological field and research that was made in due time when this market was still in the early stages brought a significant value of Ai services that now Amazon offers. Capabilities They offer cheaper merchandise because of the key/some exclusive partners, along with partnerships with logics companies around the world, and with the strategically positioned warehouses result in fast, hassle-free delivery and ending with a happy client. One of the first movers in in tech, for example by launching their own products such as Alexa and combining them with their Ai services to offer an all in one go to product that further brings customer satisfaction and trust. Brand trust created through customer satisfaction that allowed them to create other trusted sub-brands to sell, like Pinzon, AmazonBasics, 365, Amazon Fresh and many others. They also managed to keep their existing customers, some for decades, with introducing new facilities such as Amazon Prime and at the same time attracting new ones. The approach they have toward their management with certain programs such as offering college tuition for the front-line employees (Forbes named them 4th on the “Worlds Best Employers List”), as well as the input brought by front-line employees with their extensive and recognized former experience, such as Leslie Kilgore, who was chief marketing officer at Netflix since 2000 and has contributed to it’s success, as well as a former brand manager for Procter Gamble CO. from 1992 to 1999, who now continue to expand and bring value to Amazon. Huge donations for various causes such as housing and medical related issues made possible by their huge market cap., making them engaged in sustainability, help of natural disasters, and education promoter. Ai services that further help businesses with security enhancement, to better their customer services by offering tailored solutions and incorporating them with the existing software the company uses. Services such as various types of cloud storage from personal use to industrial use, data transfer, data collection with good coverage in remote locations or extreme conditions, hosting services, encryption services, app development, along with the customers service for all these solutions. Core competencies of Amazon - Optimized customer service and customer relations that follow with the company mission and statement, which is to be the best customer-oriented service provider Fast delivery due to the positions of the warehouses near airports in various cities and extensive logistics created over decades Provides products from a variety of markets and offers very good prices because of their key partnerships also developed over a long period of time Tech presence that continues to exist because it emerged at the right place and right time and continues to grow an adapt to the market at a fast pace, making it a leader in the field (AWS) VRIO Analysis into Competitive advantage Their network system consistent of key partnerships is international and very well optimized along the years since the company started, reaching and connecting markets around the world. The partnerships also represent Amazon and because of the network size developed along the years and offers low-cost solutions, because if this it is very hard to imitate, valuable and rare that make up a long-term competitive advantage. The company is one of the largest on the market at the moment and has one of the highest market capitalizations, and this allows them to also buy-out any emerging potential “threat” companies resulting in sustainable competitive advantage. Amazon also has a recognized brand equity worldwide making it easier for them, as compared to other companies to keep their clients and attract new ones. This is very difficult to imitate, valuable and rare due to the history Amazon has on the market, it proves a long-term competitive advantage. The company is a pioneer (by launching Alexa while trend emerged) and confirming their existence in the technology market but with the innovative combining of their Ai services, software platform and the products (Alexa, Kindle) they have proven to be innovative and further demonstrated competitive advantage. Further by maintaining the organized flow it has proven so far, the customers will continue using them as long as the company maintains the quality of services and products it has proven so far. This results in the continuous use of amazon.com over time by the same satisfied and recuring customers resulting in sustainable competitive advantage. 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