For sustaining in market companies have to plan their strategy to cope with current trends & buying behavior of culture rather then following traditional philosophy. For continuous growth one has to plan before & apply in timely manner.

1. Amazon
(Strategic and Financial Planning)
Sujal
Abhishek
Sijiang
Vishwak
Shylaja Ammasani
Date: 10/10/2017
Prof. Joe Garbanzos 1

2. Company Description
Strategic Map
Definition of Market and Customers
Description of Competition
Financial Management
Strategy 1: Core Competencies
Strategy 2: Sustainable Competitive Advantage
Strategy 3: Creating New Markets/Customers
Conclusion : Thinking Strategy Differently
2
Agenda

3.  Description: Founded on July 1994 by Jeff Bezos. Apart from Retail, Amazon is into cloud
computing.
 Industry: Retail(e- commerce), Cloud Computing (AWS)
 Current CEO: Jeff Bezos
 Products and Services :Retail Goods, Consumer electronics, Digital content, Web Services
 Market Share: Revenue for year 2016 was $55.4 billion. It has about 14% of global market
share
 Corporate Headquarters: Seattle, WA.
3
Company : Amazon

4.  Mission and Vision Statement: "Our vision is to be earth's most customer-centric company; to build a
place where people can come to find and discover anything they might want to buy online."
Core Values
Customer Obsession
Ownership
Invent and Simplify
Are Right, A Lot
Hire and Develop the Best
Insist on the Highest Standards
Think Big
Bias for Action
Frugality
Vocally Self Critical
Earn Trust of Others
Dive Deep
Have Backbone; Disagree and Commit
Deliver Results
4
“Our job,” says Amazon CEO Jeff
Bezos, “is to invent new options that
nobody’s ever thought of before and
see if customers like them.”
Strategy 1: Core Competency
Strategy 2: Sustainable Competitive Advantage
Strategy 3: Online Grocery Store
Strategic Map

5. Definition Of Market & Customers

6. Definition Of Market & Customers

7. Amazon’s four principal are:
• Customer Obsession
• Passion for Invention
• Commitment to operational excellence
• Long term thinking
Competition in Business: Amazon has three different segments of business:
• Media
• Electronics
• Other merchandize
Cont…
Description Of Competition

8. Amazon has deep pockets with excellent strategies to outperform its competitors in many ways
• Logistics: Amazon has built warehouses around the world, is buying airplanes, has invested in robotics, and has made logistics a
priority.
• Size and momentum: Amazon's online sales accounted for 31.0% of all U.S. Top 500 retailer sales and 26.1% of all U.S. e-
commerce sales in 2014.
• Diversification. Amazon is by far the largest online retailer in the World with an incredible selection of products.
• Prime. As a loyalty program, Prime is Genius
Apart from all these advantages of Amazon, many rivals still manages to head to head competition
to amazon in it’s own segment.
Media:
• Ebay- Ebay outperforms amazon when it comes to focus on sellers & support them.
• Netflix- Amazon prime’s direct competition is Netflix.
• Time Warner Cable’s spectrum with cable TV is direct competition of Amazon Prime.
• Apple iTunes.
• Google play store is in head to head competition with Amazon App Store
Cont…
Description Of Competition

9. Electronics:
• Best Buy- Electronic Store with deals
• Family Dollar
• Staples- All office stationaries
• Target
• Walmart
• Big lots
Online Stores:
• Alibaba.com (Whole seller of almost anything)
• Overstock.com
• Vipshop Holding
• Wayfair
Operating Segments: Amazon web service (AWS) is conquering market shares by providing best and reliable cloud
services for free (first year).
• Oracle (Cloud storage service provider)
• Google (Cloud Service & Storage provider)
• Salesforce
• Accenture
• PC Connections
When amazon has unleashed one more segment, which is Whole Food by whole food market incorporation in
$13.7 Billions.
Costco came up with 2 day and same day delivery with partnership with Instacart.
Google and Walmart collaborated.
Description Of Competition

10. Financial Management
1. Net Sales: net sales increased from 2014
to 2015 and from 2015 to 2016.
2. Operating Income: increased from 2014
to 2015 and from 2015 ($2233 Million)
to 2016( $4186 Million).
3. Net Income: Amazon's Inc.'s net income
(loss) increased from 2014( $ 241
Milion) to 2015 ( $596 Million) and from
2015 ($ 596 Million) to 2016 ($ 2371
Millions)

11. Amazon Online Grocery Business Decision Tree

12. 01
02 03
Price
Third Party Ecosystem
Leveraging The
Technology
Strategy 1:Core Competency
Amazon is able to leverage technology’s every aspect to its advantage that it
helped the online market place to not only reach the pinnacle of technical
expertise but also in making the process smoother and efficient.
Amazon has created a competitive ecosystem of third party sellers who place
their products for sale on Amazon. This strategy helps Amazon promote its
reputation and deliver the cheapest prices from the result of pricing
competition in the ecosystem
Amazon is adept on offering low prices to boost sales and retain customers. One of the
key ways it is able to do this is to minimize logistics costs. Amazon reduces its
overheads by only stocking a small percentage of its products

14. EXISTING MARKET NEW MARKET
NEWCORE
COMPETENCE
EXISTINGCORE
COMPETENCE
• Amazon Web services
• Amazon Prime Video
• Amazon Alexa
PREMIER PLUS 10 MEGA-OPPORTUNITIES
• Delivery by Drones
FILL IN THE BLANKS WHITE SPACES
• E-commerce Market
• Amazon Prime
• Amazon Fresh
• Online Grocery store
Amazon: Core Competence Acquisition
Agenda

15. Logistics
Diversification
Size & Momentum
Brand
Culture
Prime
Strategy 2: Sustainable Competitive Advantage
Logistics
Diversificatio
n
Size &
Momentum
Brand
Prime
Culture

19. Strategy 3:Creating New Markets/Customers
Amazon is currently working on taking over several new markets, according to Anthony
DiClemente, a research analyst at Nomura.
• The Online grocery business is one example of a market Amazon is ready to move into as they
acquired whole food in 13.4 bn in resent period.
• Amazon poses such a significant threat to other major grocers because it could use new
technologies to cut costs and offer dramatically lower prices.
• In the grocery segment, Amazon could cut costs by implementing new technologies like those
it is testing for its Amazon Go store format The store concept uses sensors and machine
learning algorithms that track which items customers pick up as they move about the store
• As of February, Amazon held 40% of the public cloud market while Microsoft, Google, and
IBM combined had a 23% share.
https://www.youtube.com/watch?v=5OfhJhlZemg

20. Conclusion:Thinking Strategy Differently
• Bezos’s philosophy, which is still true today, has always been that Amazon doesn’t make money when
it sells things, it makes money when it helps customers make purchasing decisions.
• Amazon has constantly supported this risk-taking culture, pushing the company to explore areas
outside of Amazon’s core business. Doubling down on distribution and fulfillment capabilities is far
from the only example of this: The company has funded a number of separate exploratory units—A9,
a product search engine developer, Click River, an advertising service, mTurk, a lab exploring the use
of human intelligence and crowdsourcing for solving difficult problems.
• In the innovation game, it is easy for firms to fall into one-track thinking: How can we optimize our
existing business model? But exploration is the path to changing the game in any given industry, it is
what allows companies to discover the future before their competitors do.
• Amazon has proven that it can disrupt established players with technology innovation and then
solidify its gains with sustained improvements. And with the help of business partners, it can amplify
those gains.