Amazon - Marketing

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M.Mix

Objecti-ves

“E-marketplace”

Web Services

High-end consumer electronics

Product

Short-term

Keep leading position in Online customer service.

Continuously enrich catalogue of available products. Focus on logistics improvement (considered as part of the product)

Propose services to individuals

New disruptive technology (software + hardware)

Mid-term

Develop drone deliveries, become independent from shipping operators (reduce margins and final costs)

Develop new services allowing C2C relation

Improve quality of existing products

Long-term

Become shipping leader, enlarge customer base to small and large companies non-related with retailing industry (like do DHL, Schenker and others) optimize shipping costs through loading synergies

Acquire one significant competitor to enlarge further the product base and guarantee market share

Create an eco-system linking all products together

Price

Lowest prices possible independently of time and business activity – it is linked to declared customer centric approach and global strategy aiming cost optimization and funds for new products implementation through larger customer base (↗ customers = ↗ infrastructure = ↘ costs = ↗ customers = ↗ revenues = ↗ investments for new products = ↗ customers)

Place

Short-term

e-platform

Services available anywhere in the world through the Web. Position servers in low cost countries with high internet development to minimize storage and maintenance costs.

e-platform + all retailers selling competitors’ products

Mid-term

Open chain of small groceries

Dedicated shops (like Apple and Samsung have)

Long-term

Open chain of large groceries

Dedicated area in large groceries

Promotion

Independently of time - Prime membership development as a chain linking all verticals together and creating a sub-eco-system. Adding preferential features and discounts, some free of charge items.

Mid-term

Specialized IT websites, dedicated events

Advertisement through social media and events. ↗ brand perception.

Long-term

- Alternative solution

Focus only on both business verticals where competitive advantage is acknowledged and cancel the High-end consumer electronics development.

As the 3rd segment demands significant investments in terms of product (R&D), place (inventory) and promotion (social media), all those funds could be redirected to strengthen faster the AWS leadership (through infrastructure and technology development). Adding on top new features to Amazon Prime membership (out of which some would be directly linked to AWS), making it impossible for Walmart to copy and promoting in the same time the non e-commerce business part of Amazon.

The supply chain development must be still maintained as e-commerce expectations are increasing and Walmart has a strong infrastructure in place in this aspect.

- Implementation plan

Amazon will be very busy in the first 3 years securing its position. It will need to invest largely in drone and fulfillment centers in order to counter-effect any potential development from Walmart and Alibaba. In the same time advertisement for e-commerce should be implicit - only through the customer service and cost attractiveness – so to restrain the brand perception limitation. Most of the advertisement campaign shall be focused in the first period on the AWS so to bind the brand perception with higher technology. The shift of customers’ attention shall be in the same time influenced by Amazon Prime – AWS will be developing products available for individuals, which will allow to directly link them with the customer loyalty program.

Electronics will only be a source of R&D expense, in search of a disruptive product.

In a 2nd phase, (four following years), the AWS will maintain its leadership through new product and additional advertisement in professional IT newspapers and websites. The e-marketplace will go beyond the virtual market – it will use the Artificial Intelligence developed through several years of customers’ purchases data and Amazon Prime profiles to choose a limited catalogue of products and define best location for instore sales. The e-marketplace will enlarge its activity opening small surfaced groceries, a very limited communication campaign will be done on Amazon internet sites.

Electronics will finally deliver advanced quality products which will be promoted actively through Amazon Prime, social media (LinkedIn, Facebook, Twitter, YouTube, Instagram, Pinterest) and dedicated events (

Electronics exhibitions, special launch events) (exhibit 2). Most of the communication campaign will be focused on this segment. Dedicated Amazon Shops with Electronics will be opened to also influence the brand perception and products availability.

In a 3rd phase (future, 7 years from today), and considering the previous two influenced positively revenues, the cost advantage in “marketplace” will be increased by opening larger groceries (might be an acquisition of a previously competing retailer) which will be able to host a dedicated space to Amazon Electronics. In parallel, AWS will be dominating the industry and an external