SM Project on

AMAZON
GROUP B7
An overview of Amazon
• Amazon’s popularity is widespread around the globe. It has over 310 million
active users and 100 million subscribers worldwide. Being the world’s leading online
retailer, Amazon bags many achievements, eye-popping profits, and successful
launches.

• Let’s discuss this online retail giant in a little depth and understand the company’s
business scenario with the help of Amazon SWOT analysis.

• Jeff Bezos laid the foundation of Amazon in 1994. Originally, the company started as
an online bookstore but soon converted to a top online retailer selling almost
everything from A to Z just like its logo says.
Vision and mission statement analysis:

• Mission- “We strive to offer our customers the lowest possible prices, the best available selection, and
the utmost convenience.”

• Vision- “to be Earth’s most customer-centric company, where customers can find and discover anything
they might want to buy online.” 
VRIN matrix:

• Valuable- In Amazon, there is logistic speed and innovation.

• Rare- In Amazon, there is bundle of services

• Inimitable- It is difficult to imitate but it can be inimitable for startup.

• Non-Substitutable- In Amazon, there is whispernet-3g.

Porters’ generic strategy:

Amazon uses cost leadership as its generic strategy for competitive advantage.

Minimization of operational costs is the objective in this generic competitive strategy.
External Factors Evaluation (EFE)
Matrix
Opportunities Threats
State of the economy is
Taxes imposed for EU customers
improving
Pressure to permanently ban
Aggressive competition
the Internet Tax
Increased number of Internet
users worldwide Ease of entry into market

Online sales predicted to

increase Identity theft

Customer spending increased Volatile stock market

Internal Factors Evaluation (IFE)
Matrix
Weakness Strengths
Operating losses Strong management team

Interest payments on debt

High brand name recognition
issued

High inventory risk - seasonality Distribution centers

Small number of vendors

(suppliers) High inventory turnover

Breach of customer confidential Up-to-date technology and

information software

Corporate culture
 BCG Matrix
STAR Question Marks

Amazon
Prime Air Amazon Fresh
(Drones)

Amazon Retail
Goods Amazon
Amazon Auctions
Prime Amazon
Amazon Studios
Kindle
Cash Cows Dogs
What are the core competencies of Amazon.com based on internal
analysis?

There is a reason why Amazon is at the top of the chain in the e-commerce world – it does
what it does well!

The following are some of Amazon’s core competencies:

Customer Brand Technological

Convenience Variety Low Prices
Experience Equity Achievement
 PESTLE Analysis
• The organization has economic stability in the
• Political stability I the developed countries, such as in USA
developed market
& European countries
• There is an increase in disposable income in
• The business has complete government support
• the developing countries
Increase in the effort by government to enforce proper
• There is an economic recession in India,
cyber securities option.
which is a threat to the company

POLITICAL

• There is an increase in wealth disparity,

• Rising interest in the environment programs
• Rising emphasis on sustainability EVIRONMENTAL ECONOMICAL which is a threat
• There is an increase in the consumerism I
• Increase in the popularity of low carbon
the developing countries, which is an
lifestyle
opportunity
• There is an increase in online buying habit
which is an opportunity as well

LEGAL SOCIAL
• Opportunity of rising product
regulation
• Change in the import & export • There is a rapid technological
regulation
TECHOLOGICAL obsolesce
• There is an increase in rising • Increase in efficiency of IT resources
environmental protection regulation on • Increase in the rate of cyber-crime
business which is a threat
 SWOT OF AMAZON
Strength: Weakness:
1. Strong brand name 
2. Brand valuation  1. Easily imitable business model 
3.Customer oriented  2. Losing Margins in Few Areas 
4.Differentiation and Innovation. 3. Product Flops and Failures 
5.Largest Merchandise Selection  4. Tax Avoidance Controversy 
6.Large number of third-party sellers  5. Limited brick-and-mortar presence
6. Declining consumer safety 

Opportunities: Threats:

1.Amazon can gain the opportunity to penetrate or expand 1. Government regulations 

its operations in developing markets. 2. Links to exploitative labour 
2.By expanding physical stores 3. Aggressive competition with big retail firms
3.Amazon has the opportunity to improve technological like Walmart and eBay 
measures and organizational policies to reduce counterfeit 4. Fake Products – The increase in counterfeiting
sales.   and fake products. 
4.More acquisitions  5. Economic Recession
5.Self Driving Technology . 6. Fake reviews
6.Launch of electric rickshaws in India
 Value Chain
Human Resource Management
• The effective HR management can allow Amazon com to reduce competitive on motivation, commitment and skills of its
SUPPORT ACTIVITIES

workforce.
• The company can also achieve its cost minimisation objectives by analysing hiring and training costs with their relative return.
• The heavy dependence of Amazon com on employees' talent will increase the importance of this value chain support activity.
pressure based
Procurement
• The procurement in value chain denotes the processes involved in purchasing the inputs that may range from equipment, machinery, raw
material, supplies, raw material and other items necessary for producing the finished product

Technology
• The technological integration in production, distribution, marketing and human resource activities requires Amazon com to realise
the importance of technology development.
Outbound Marketing & Service
Inbound Logistics Operation
I. Marketplace
Logistics Sales 1.Warrenty
1.Vertically integrated
1.Order 1.Earth Most and support
suppliers operation, for
2.Decentralized Fulfilment customer centric
centers to route the item a
II. Packaging, Fulfilment company Marketplace,
put away location III. AI-Software 2.Order 2.Segmentation Aws,
3.Item Replenishment Development Handling 3.Customer service. 2.Education
4.Quality Control, fulfilment and training
from prime Location
IV. AWS 3.Invoicing 4.promotion
Operation

PRIMARY ACTIVITIES
CPM Analysis:
Competitive Profile Matrix  
Amazo   Ebay.com   Walmart  
n.com
Critical SuccessFactors Weight Rating Score Rating Score Rating Score
Market Positioning 0.11 4 0.44 4 0.44 4 0.44
Price Competitiveness 0.05 3 0.15 3 0.15 4 0.2
Financial Position 0.05 3 0.15 2 0.1 4 0.2
Consumer Loyalty 0.12 4 0.48 3 0.36 3 0.36
Brand Awareness 0.13 4 0.52 3 0.39 3 0.39
Service Quality 0.11 4 0.44 3 0.33 4 0.44
Global Expansion 0.08 3 0.24 2 0.16 4 0.32
Customer Service and Support 0.11 4 0.44 3 0.33 4 0.44
Organizational Structure 0.05 3 0.15 3 0.15 3 0.15
E-commerce 0.11 4 0.44 3 0.33 3.5 0.385
Product Diversity 0.08 3 0.24 2 0.16 4 0.32
  1   3.69   2.9   3.645
Strategy Canvas: Amazon vs walmart Vs ebay vs Alibaba

45 10500
2.73 $514,405 Million
billion

40
$280,522 Million
200

856 million 32 country

36

$56,152Million
24
560
469 million
$ 10,800 Million
14 13 country
176 million

65 

Traffic Revenue Product Physical Cost

expansion
Site category stores leadership
Conclusion:

Amazon has developed an unprecedented customer support only in

the span of last 15 years with its unique business model of online
business. This not only allows the company to have a cutting edge
advantages over the competitors but also makes it a cost leader in its
business.
 GROUP B7
Ayush Tiwari 20PGPM085
Dhaanya 20PGPM090
Meenal Wadhwa 20PGPM104
Shekhar Kumar Alagh 20PGPM122
Tuhin Ghosal 20PGPM130
Gudapati Jitendra 20PGPM136
GROUP B7