3. Current Assessment
Amazon had a razor sharp
focus on growth and
expansion for years; it had
yet to turn a profit
Leadership was concerned
about mounting pressure
regarding the spinoff of Amazon Web Services
High aggressive industry segment;
Marketplace leaders regularly disrupt
business and vice versa
4. External Analysis-PESTEL
Demographic
o Broad customer base (books, devices, professional services, gaming)
o The convenience of Amazon is not limited to one group
o Depth of products and broad appeal (financial implications)
o Prime customer is higher household income bracket
Political
o Lawsuits re. lower profits for authors and publishers
o Accused of violating Toys “R” Us contract
o Loss of pricing advantage re. sales tax
Economic
o Counterfeit items
o Broad range of products protects company from economic factors
o Fluctuation in shipping charges
5. External Analysis-PESTEL
Sociocultural
o Packaging, wind farms, solar energy, recycled
energy
o Environmentally friendly on-line shopping
Global
o Growing in Europe; India presents strong
opportunity
o Owns Joyco.com in China; now called Amazon
China
Technological
o Products with high functioning batteries, “Point
and shoot” shopping
o Video gaming capabilities
o Exclusive content
o Storage capabilities
o Kiva
6. External Analysis-Five Forces
Significant
Intensity of Rivalry
Moderate
Bargaining Power of Buyers
Low
Threat of Entrants
Threat of Substitutes
Bargaining Power of Suppliers
13. Strategic Plan
Recommendation and Key Benefits
Retain AWS within Amazon
Continue to innovate (internally, externally)
International expansion
Turn a profit
14. In Summary
Bezos Reflection of the year ending for 2014
Internal & External Analysis – strengths
outweigh weaknesses
Achieving Competitive Edge – it’s all about the
“long run”
Strategic Direction – where do they go from
here