Amazon

 History
Jeff Bezos founded Amazon in July 1994. He chose Seattle because of technical talent as Microsoft is
located there. In May 1997, the organization went public. The company began selling music and videos
in 1998, at which time it began operations internationally by acquiring online sellers of books in United
Kingdom and Germany. The following year, the organization also sold video games, consumer
electronics, home-improvement items, software, games, and toys in addition to other items.
In 2002, the corporation started Amazon Web Services (AWS), which provided data on Web site
popularity, Internet traffic patterns and other statistics for marketers and developers. In 2006, the
organization grew its AWS portfolio when Elastic Compute Cloud (EC2), which rents computer
processing power as well as Simple Storage Service (S3), that rents data storage via the Internet, were
made available. That same year, the company started Fulfilment by Amazon which managed the
inventory of individuals and small companies selling their belongings through the company internet
site. In 2012, Amazon bought Kiva Systems to automate its inventory-management business,
purchasing Whole Foods Market supermarket chain five years later in 2017.
 Reasons for Amazon’s Success

Amazon’s success largely stems from its innovative technologies and practices, many of which were
championed by its CEO, Jeff Bezos. Consider the Echo, Amazon’s impressive voice command device.
Echo can be used to play songs, research your favourite sports teams, and even check the weather with
a few spoken words. This innovative technology was a huge investment for the e-commerce giant—one
that fostered exceptional results. Over 22 million Echo units were sold in 2017 alone. Amazon’s
progressive mindset doesn’t always bear fruit, but accomplishments like the Echo prove that innovation
can yield impressive results for e-commerce companies.

Because of its commitment to world-class customer service, Amazon has developed a range of helpful
tools users can employ to track packages and quickly return or exchange ordered items, bringing
simplicity and convenience to their online shopping experiences. Amazon’s Customer Service team has
won multiple awards for its dedication to preventing and swiftly addressing problems for customers.
One of Amazon’s overarching missions is to become the planet’s most customer-centric company—
and the brand’s dedication to this goal has paid dividends. Social media is another powerful tool that
Amazon employs to engage with shoppers and enhance the quality of its customer service. When done
right, social media channels can help your e-commerce business address customer concerns and build a
solid foundation of loyal and passionate followers who advocate your brand. That’s why many e-
commerce companies work with Snap’s Social Media Team to refine and grow their social presence.

Amazon gets everything right when executing customer orders. They select products and services that
customers want and need—and leverage distribution centres across the globe that allow them to
quickly ship products. Amazon also has excellent vendor relationships that allow them to offer
customers discounted pricing. The world’s largest online retailer is also ramping up plans to invest
more across Europe this year, employing thousands of more employees. They’re also looking to
implement brick-and-mortar stores that will have the capability of same-day-delivery via drones.

Starting off as an online bookstore, Amazon now offers everything from soup to nuts. Literally. A
search of the site reveals over 3,000 listings for vegetable soup. Search the term “nuts” and you’ll see
over 37,000 results. Amazon now carries products in music, books, electronics, health and beauty,
automotive, grocery and clothing. Business owners can contract with Amazon’s network of pros to get
IT support, furniture assembly and even A/V services. By diversifying its offerings, Amazon is
continuously driving reach and relevance. Regardless of your industry, you should be fearless in the
pursuit of diversification. Expanding into new markets and product categories will help you attract new
business opportunities to grow your organization. You should even diversify your digital growth
initiatives when possible. For example, Amazon currently boasts an impressive 3.6 billion backlinks
and 3.8 million referring domains. A highly diversified link portfolio plays a pivotal role to any
successful SEO campaign. That’s why many e-commerce companies partner with us to optimize
their link building strategies.
 A strong UX makes it easy for e-commerce customers to find what they’re looking for and move
further down the conversion funnel, resulting in more sales. That’s why Amazon employs a full UX
team comprised of professionals in everything from user research and interaction design to web
development. These UX experts collaborate with Amazon’s engineers, product managers and
executives to create seamless user experiences that drive customer conversions. Fortunately, any
company can improve its online UX with help from the right digital marketing partner. Snap Agency’s
Design Team offers comprehensive web design and CRO (conversion rate optimization) solutions to
help you perfect your website’s UX and UI. Our human-centred design process will boost the
conversion impact of your online presence through user experiences that inspire and engage.

It’s no secret that long-tail content is a huge component of e-commerce SEO. You need large amounts
of keyword-rich copy to increase the visibility of a page on search engines—which is why Amazon
uses lengthy product descriptions and FAQs on its product pages. However, take a look at any product
page on Amazon, and you’ll notice that this long-tail content doesn’t adversely affect its flow or UX.
Amazon’s product copy is given less priority than important CTAs (such as the “Add to Cart” and
“Buy Now” buttons). This seamless merging of design and content ensures that Amazon pages
attract and convert relevant web traffic. If you’re looking to optimize your site’s content without
sacrificing its UX, then consider partnering with a digital marketing partner like Snap. We provide
robust content marketing solutions for our e-commerce clients to maximize the performance of their
product pages on leading search engines. Our SEO Team can create impactful long-tail content that
aligns seamlessly with your site’s design to drive traffic and conversions.

Does anybody really remember when Amazon was unprofitable? If you’ve been around for a while,
you might remember Bezos’ warning to investors that it would be a long time before they would see a
return. Back in 1997, he told Inc. Magazine that Amazon would be unprofitable for a very long time.
His “in it to win it” mindset kept the company pushing through new strategies until 2003—when the
company posted its first profit. No matter how you look at it, Amazon has grown up from a little online
bookstore to an industry giant. You could even say Amazon created the industry for total domination.

 Amazon’s Growth Graph (1997-2019)

 Subsidiary Companies

1. Whole Foods Market- Whole Foods is a prominent grocery store chain with the distinction of
being the only USDA Certified Organic grocer in the U.S.

2. Ring- The company specializes in smart home security devices, including its popular Ring
Video Doorbell, which allows users to monitor entry points to their home from a remote
location.

3. Zappos- Zappos is the leading footwear and apparel website in the world. The name comes
from the word zapatos, which means "shoes" in Spanish. 

4. PillPack, Inc.- One of Amazon's more recent acquisitions is PillPack, Inc., an online pharmacy
company.

5. Twitch Interactive- Twitch Interactive is perhaps best known for its live streaming video
platform, also called Twitch. This platform is incredibly popular among video gaming
enthusiasts, with more than 15 million daily active users.

6. Kiva Systems- Kiva Systems, now rebranded as Amazon Robotics, was one of Amazon's
largest purchases at the time of its acquisition in 2012. The company develops and
manufactures robotic systems for a variety of uses. Interestingly, compared with Amazon's
other acquisitions, Kiva Systems has been fairly unique.

7. Audibles- Audible sells and produces audio entertainment, information and educational
programming on the Internet. The company sells audiobooks, radio and TV programs, and
audio versions of magazines and newspapers.

 Challenges Faced by the Company over the Years

1. Keeping Up E-commerce Growth- As noted in a recent report from by Evercore ISI's Anthony
DiClemente, growth in Amazon's legacy, first-party e-commerce business has lost some of its
steam, with Amazon posting 10% growth year-over-year in the segment "While other higher
margin business lines have taken over the growth mainly from the Online Stores unit, this
operating segment still makes up >50% of revenue, and a more substantial slowdown would
weigh on consolidated revenue growth," he wrote.

2. International Performance- Some of Amazon's lacklustre October earnings was accounted for

by weak returns in Amazon's international segments, which posted lighter-than-expected
growth at 15% on a constant currency basis versus 21% the previous quarter. Amazon CFO
Brian Olsavsky pinned some of the weak growth on the timing of India's Diwali holiday as
well as Amazon's purchase of Souq.com on an earnings call, but investors will be on the
lookout for how Amazon fares internationally this year.

3. Keeping Rivals at Bay- Amazon may be the undisputed leader in e-commerce, but formidable
rivals like Walmart (WMT) - Get Report could get more aggressive in their efforts to siphon
market share from Amazon. In a December report, Edgewater Research's Daryl Boehringer
pointed out that Amazon pulled back on promotions and price matching versus rivals last year,
and in turn, "brick-and-mortar competition (namely Walmart) appears to be taking advantage
of Amazon's less aggressive stance," he wrote, citing an apparent profit focus, rather than a
growth focus, by Amazon in recent quarters. For investors, sabre-rattling from other retail
giants, ever eager to deepen their online presence, is worth keeping an eye on in 2019.

4. Balancing Investments vs. Profits- With Amazon's newer efforts in areas like health
care consistently in the news, Evercore's DiClemente wrote that a fresh wave of investment by
Amazon could be imminent in 2019. "Amazon is obviously notorious for ploughing earnings
back into the business," he wrote. "With new initiatives like healthcare, payments, logistics,
etc. continuing to make headlines, there is some concern amongst investors that the next
 aggressive investment inflection could be just around the corner." Although investing in new
technologies and lines of business can reap rewards down the road, an aggressive investment
ramp-up could also weigh on Amazon's earnings growth story in the coming year, according
to DiClemente.

5. Dealing with More Intense Government Scrutiny- With a new congress just settling in, fresh
scrutiny of tech giants could also pose issues down the road. The EU and other countries like
France have stepped up their regulation and taxation efforts of major tech companies,
including Amazon. In the U.S., Amazon's HQ2 expansion -- and the large tax breaks it
received -- became a flash point for criticism last year of Amazon's size and influence over
policymakers. And with a changing of the guard in Congress, privacy and antitrust concerns
will be key issues to watch as lawmakers on both sides of the aisle step up their scrutiny of the
power of Big Tech.

 Competitors

1. Walmart- Walmart is another global giant. This big-box department store generates $514.41
billion in net sales per year. That’s more than double Amazon, although a large percentage of
Walmart’s sales obviously come from brick-and-mortar purchases. There are more than
11,000 Walmart physical store locations across 27 countries. While Walmart is best-known
for its physical department stores, this retail giant also has a significant presence online.
Behind Amazon, Walmart is the second most popular online store in the United States in
terms of ecommerce revenue. With Walmart’s international presence and customer base, they
will be a continuous threat to Amazon in the ecommerce space. Walmart’s online sales are
growing at 40% year-over-year. At this pace, you can expect this giant to take away even
more Amazon business in the coming years.

2. Alibaba / AliExpress- Alibaba is a China-based online retailer. This international giant

specializes in wholesale selling online, which is a differentiation factor compared to Amazon.
Another unique difference between Alibaba and Amazon is its overall business model. While
Alibaba is the B2B focus of the company, while the other branches focus on B2C and
multinational brands, respectively. As of June 2019, there are   worldwide. The company is
755 million Alibaba users

responsible for 58% of all online retail sales in China. Alibaba sold $30.8 billion of products
on November 13, 2018, the Chinese version of Black Friday known as “Singles Day.” With an
international presence, a dominant market share in China, and B2B sales in addition to B2C
focus, Alibaba is a force to be reckoned with. Plus, any website that can do $30 billion in one
day can definitely win against Amazon.

3. Otto- Otto is a European online retailer. The company is best known for innovation
throughout the years to keep pace with the times. At its core, Otto is a trading company,
meaning that it sells products from other brands on its ecommerce platform. It’s essentially a
one-stop-shop for buying online in Europe. Some of Otto’s top categories include fashion,
electronics (like Apple and Microsoft products), home goods, and sports. One of the reasons
why Otto is so popular is due to its user-friendly interface. The platform makes it easy for
consumers to shop online. In 2019, Otto generated roughly $3.8 billion in revenue from online
sales. While this may seem marginal compared to Amazon, it’s still extremely impressive.
Otto has a 13.7% annual growth rate. 72% of their sales come from furniture, appliances, and
fashion purchases. This makes them unique compared to Amazon.

4. JD- Formally 360buy, JD (Jingdong) is another Chinese ecommerce business. This Fortune
Global 500 company is a direct competitor of Tmall, which is run by Alibaba. At JD.com,
consumers can buy a wide selection of products at an affordable rate. The website also has a
“buy in bulk” category, which is another reason why it goes head-to-head with Alibaba.
Joybuy.com is also an affiliate of JD. This site is in English and ships to more than 200
countries worldwide. It also offers 24/7 customer service and 30-day returns. Jingdong has
more than 305 million active customers. Its quarterly active customer accounts are increasing
at a 22% year-over-year growth rate.
5. eBay- Everyone is familiar with eBay. This website was a pioneer in consumer-to-consumer
selling through an online marketplace. Over time, eBay has evolved and become more than
just a way for consumers to buy and sell their own new or used merchandise. Today, eBay is
used for B2C sales in addition to its traditional C2C model. In terms of  marketplace website
visits, eBay is second to Amazon, with just under 20% of the market share. The site traffic to
eBay is impressive. It’s nearly double Walmart, and we’ve already established how successful
Walmart is in the online space. With the ability to bid on products and the unique way for
buyers and sellers to connect online, eBay is a top competitor to Amazon.

6. Flipkart- Flipkart is a newer ecommerce company compared to some of the other competitors
on our list. This Indian-based ecommerce platform was founded in 2007 and quickly became
the largest online retailer in India. In 2018, Walmart acquired 77% of Flipkart’s shares,
valuing the company at $22 billion. With Walmart controlling the majority stake of Flipkart,
there’s no telling where the company can go from here. More than 100 million users are
registered on Flipkart. The platform’s user-friendly design, mobile app, and customer service
make it one of the up-and-coming Amazon competitors. With such a wide range of products
offered through Flipkart, the company is poised for continued success in the coming years.

7. Rakuten- Rakuten is a Japanese ecommerce company. The business generates more than $2.3
trillion per year in retail ecommerce sales. In 2019, Rakuten controlled 14.1% of the total
global ecommerce market in terms of retail sales. Furthermore, they are responsible for nearly
10% of the total ecommerce retail share in Japan. Rakuten generated more than $134 billion in
Japanese ecommerce sales alone in 2019. In 2010 they purchased buy.com to expand its
global presence in the United States. Aside from buy.com, Rakuten has acquired other
ecommerce companies like Price Minster (France) and Play.com (UK). They also ventured
into acquisitions like Ebates (cash-back rewards) and Viber (VoIP software). As Rakuten
continues to expand and buy companies across varying industries and regions, they will
attempt to keep pace with Amazon.

8. Newegg- Newegg is a global leader in selling electronics like laptops, TVs, cameras, phones,
and computer products online. The company generates $2.7 billion in revenue by offering
electronics at an affordable rate. The fact that Newegg is successful in the electronics space is
threatening for Amazon. That’s because electronics is Amazon’s most popular category. 44%
of Amazon shoppers in the U.S. have purchased an electronics product through the platform.
Clearly, Amazon relies on those sales. Newegg’s market share takes billions away from
Amazon in this category.