...people and give them opportunities to promote and sell their product. Amazon is also expanding their service from books to other merchandise which is a plus. But like in any case, working with other services or third parties can bring risk. I feel like Amazon will surpass and find ways to adjust and work their way through. 2. I agree and disagree at the same time with Ravi Suria’s analysis. Amazon present negative cash flow which results higher debt risks than other retailers who has a lower ratio of debt. It created doubt in people if Amazon was able to carry themselves and not run out of money. But then I disagree because at the end, Amazon strategically used those critics and remarks and make adjustments to their operating procedures. Amazon did not change their business model which resulted a missed in Suria’s predictions that were to be expected. 2. Amazon today is one of the largest and known web retailer in the United States. There are people from all over the world buying products and even selling their products. Their business model is still pretty much the same. You can find any product you need and or you can have sell your products and have the option of having Amazon fulfill the shipment orders. Amazon kept their vision of offering diversity of products, which I recently learn that in 2015 is beat Walmart as the most valuable retailer in the US by market capitalization. This proves that Amazon did great over the past...
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...Mighty Amazon by Fred Vogelstein The story of how he started Amazon is now legendary. While working at Shaw in 1994, he read a study that predicted the Internet would explode in popularity. He figured it wouldn't be long before people would be making money selling over the web. After researching a host of items that could sell online, he settled on books. Almost every book was already catalogued electronically, yet no physical bookstore could carry them all. The beauty of the model, Bezos thought, was that it would give customers access to a giant selection yet he wouldn't have to go through the time, expense, and hassle of opening stores and warehouses and dealing with inventory. It didn't work out that way. Bezos quickly discovered that the only way to make sure customers get a good experience and that Amazon gets inventory at good prices was to operate his own warehouses so he could control the transaction process from start to finish. Building warehouses was a gutsy decision. At about $50 million apiece, they were expensive to set up and even more expensive to operate. The Fernley, Nev., site sits about 35 miles east of Reno and hundreds of miles from just about anything else. It doesn't look like much at first. Just three million books, CDs, toys, and house wares in a building a quarter-mile long by 200 yards wide. But here's where the Bezos commitment to numbers and technology pays off: The place is completely computerized. Amazon's warehouses are so high tech that...
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...ACE Challenge 2015 Amazon Confidential Preliminary Round: ACE Case Breakers Case Study: Operations Introduction It is a bright autumn morning in 2205 and Gaurav Maurya, SVP – Amazon Enceladus1, is gazing outside the window and reminiscing about how Blue Origin2 had transformed Enceladus into a bustling human colony in a short span of 50 years, much like some of the developing countries back on Earth. Also, continuing Amazon’s legacy, Amazon.en has become Enceladus’s most customer-centric company in a short span of one year and customers love to buy all sorts of products on it every day. Gaurav is scheduled to meet the Board of Directors back on Earth in 3 days to present the first year report. For this meeting, Gaurav has decided to focus on operations, and on how different verticals within operations are helping raise the bar on customer experience. Gaurav enlisted four of his team members to share their stories. As Gaurav prepares for the meeting, he has asked you to take a look at the reports that his team has put together and help him answer some open questions and come up with fresh ideas on how to solve the problems. Scenario 1: Like on Earth, Amazon’s goal is to offer Enceladus’ largest selection on Amazon.en. Deonn, who recently joined Amazon.en wants to accelerate the addition of new products in the catalogue. While Amazon already provides tools for vendors to submit their items in the catalogue, the error rate remains high. On an average, vendors...
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...fortify in the tablet market as new entrants such as Amazon, Samsung, Motorola and Google battle to overrule the already dominant and established Apples, iPad. Jeff Bezos, creator of amazon chose to step out of his area of comfort, away from the online bookstore in attempt to overthrow the tablet industry, he did so an was able to capture half of the non-Apple tablet market. It can be said that Amazon were the one who introduced e-books because of Jeff Bezos innovation and urge to simplify the everyday lives of individuals. Despite the success the Kindle Fire experienced as it entered this market, amazon was moving further away from what they had originally specialized in, and closer to a market which was already established long before they decided to enter. A detailed analysis of Amazons internal and external environment is needed in order to be able to fully understand the condition of the issue and to be able to formulate a successful recommendation that will align with the corporations goals. The internal analysis includes the companies features while the external analysis was conducted using Porters five forces study. The three alternatives that amazon could pursue were: to continue to compete in the tablet market, to step away from this industry and focus on the companies strong areas, and to partner with universities in order to stay close to their comfort zone while still expanding. In the long run, Amazon should work towards satisfying their current consumers...
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...When first reading this case we thought that Amazon is using Clayton Christensen’s law of conservation of attractive profits which says that when one thing becomes modular and commoditized, another thing becomes valuable. We thought that, as shown by exhibit 4, Amazon is selling the excellent Kindle at a bargain or maybe even at a loss (Kindle is better on most specifications than its direct e-ink competitors and is less expensive) in order to make huge profits on eBooks sales. A common strategy in the industry: Google gives its mobile OS Android for free because the more people will use smartphones the more money Google can make on online advertisement – its core business. But after a closer look we noticed that Amazon isn’t even making money on eBooks sales because as we can see in the document, eBooks on the kindle store (Via Kindle readers, PC, Mobile phones etc.) can be sold with a (significant) loss for Amazon. And this is, in our opinion how Amazon changed the book industry, it has dramatically lowered the cost for customers to acquire an e-reader (a basic kindle reader costs no more than 49$ today) and didn’t stop at that, it made the purchase of e-books even more affordable by subsidizing the later. A strategy that no competitor can follow, because very few can afford to lose money on every sale they make. In addition, Amazon is making it very easy and very profitable for writers to self-publish on the kindle web store. This is a real game changer. Because not only writers...
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...CBIS250 Section 001 Amazo.com Case Report Part 1 Case Overview This case is mainly about that Amazon.com provides Amazon Web Services (AWS) using its tremendous computing capacity. And utility computing is used as a method charging for services. Amazon’s powerful infrastructure provides them many advantages to attract service users. Such as S3, a data storage service, that is designed to make Web-scale computing easier and more affordable for developers. However, Amazon.com also has some problems in its development of AWS. We just study Amazon’s experience and find some solutions to those problems. Part 2 Organization Context Amazon.com is a virtual superstore with product offering in 36 categories. In 1995, Amazon.com was found. At the beginning, Amazon.com only provided services as bookstore through the Internet. Since 1995, Amazon.com has developed as the largest bookstore through Internet in the world. And Amazon.com is also the bookstore which sells the largest number of books all over the world. But Amazon.com has neither so many employees nor lots of buildings. Now, Amazon.com offers not only books but also music, video, furniture, clothing and even jewelry. 36 categories products are provided by Amazon.com now. Amazon.com reaches its diverse goals through acquiring other kinds of companies. And E-commerce helps Amazon reduce cost and become larger and larger. Since Amazon.com’s infrastructure is so powerful that most...
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...1. What does it means to have the mission, “the earth most customer-centric company”? How well is Amazon achieving this mission? The concept of customer-centric and its benefits has been discussed for more than 50 years. Drucker (1954) wrote in his book, The Practise of Management, that “it is the customer who determines what a business is, what it produces, and whether it will prosper.” Levitt (1960) proposed that firms should not focus on selling but rather on fulfilling customer needs. Gavan ( 2012) further elaborate that customer centricity doesn’t mean doing everything customers want. It means focusing on what they value most, in line with overall business strategy and brand promise. For example, the most important thing for a budget airline customer is price. While passengers might like extra leg room, they don’t want it at the expense of low airfares. Danish (2006) summarised the characteristic of an organisation with customer-centric as below:- Basic Philosophy | Serve customers; all decisions start with the customer and opportunities for advantage | Business Relationship | Relationship Oriented | Product Positioning | Serve customers; all decisions start with the customer and opportunities for advantage | Organizational Structure | Customer segment centers, customer relationship managers, customer segment sales team | Organizational Focus | Externally focused, customer relationship development, profitability through customer loyalty; employees are customer...
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...Amazon Kindle Case Study The case study under review in the McGraw Hill text International Business: competing in a global marketplace on page 533 deals with the Amazon Kindle e-reader. The e-reader market quickly became flooded with competition from many competitors who have found ways to design the products mainly in the United States but find cheap parts and labor by outsourcing manufacturing to other countries. This international competition is no surprise in an increasingly global market. When deciding where to manufacture the key components of the Amazon Kindle, the main driving factors considered were sleek design that is highly functional and reliable with relatively low price. In designing the display, Amazon utilized the design expertise of a leading company in Cambridge, Massachusetts. E Ink designed the microcapsule beads that make the Kindle’s display visible with miniscule amounts of battery. Despite the research and design coming from American firms, there are no American firms that have the ability to manufacture the “bistable electrophoretic display” that shows an image without utilizing battery power. Amazon landed on a Taiwanese based company to manufacture the display components; which are the single most expensive to manufacture, costing about $60 per unit. Next the wireless card is designed by Qualcomm in San Diego and allows the Kindle user to access the digital bookstore wirelessly. The component cost about $40 to manufacture and is produced by...
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...Amazon Case Study I definitely think Amazon is moving away from its core capability of being a leading online retailer. I shop on Amazon.com frequently because of their competitive prices. Amazon.com provides new and used top of the line products for very low prices, and their used products, such as DVDs and video games, are in top shape. I am very pleased with Amazon.com being an online retailer. I do not think it is a wise thing to do. It is understandable that Amazon’s operating margins are lower than Wal-Mart’s because Wal-Mart is an actual retail store instead of an online retailer. Many people do not shop online, therefore the operating margins and profits are going to be different. The components of the Amazon database are the Simple Storage Service (S3), Elastic Compute Cloud (EC2), and the Mechanical Turk. With the Simple Storage Service, Amazon charges 15 cents per gigabyte per month for businesses to store data and applications on Amazon disk drives. With the Elastic Compute Cloud, Amazon rents out processing power, starting at 10 cents per hour for the equivalent of one basic server. The Mechanical Turk service combines processing power with networks of real people who are paid to do the kind of work machines cannot do as well as humans can, such as recognizing inappropriate content in images or transcribing audio. Companies post work onto the Mechanical Turk and pay people online. Amazon receives 10 percent commission for this work. The data management issues...
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...Amazon.Com - Financial Analysis Case Study Name Institution Course Date Amazon.Com - Financial Analysis Case Study Introduction The bookselling business is one of the stable developing industries which have an estimated a total sale of $27 billion in 2006. The vending of the books mainly relies upon distinctive seasons. The business has different clients who purchase various types of books which also incorporates the professional books, trade books, college books, and mass business paper-back books. With solid competition from the corporate sector, the organizations are strongly concentrating on adopting distinctive ways and means to win more customers and getting a high market share in the company. Company Overview Amazon.com is thought to be the market player in the e-trade industry; that is, bookselling. The company was established by Jeff Bezos, who concentrated on upgrading the book shopping experience of buyers, with the development and better approaches to selling books via the web. One of the key players of the company is Noble and Barnes. Initially, the company began as an online bookshop that has transformed into one of the biggest online retailers offering items ranging from movies and music to furniture and artwork. As its website states, "it is by configuration that technological development drives the growth of Amazon.com to offer clients more different products, at lower prices, and even more conveniently." In this paper, we will review the financial...
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...all gadgets amongst themselves. E.g. here we wish to have a network pool registered with the Master Controller which enables connectivity and interaction of all the devices with each other. So a DSLR connected to a Smart TV through the master controller shall enable us to see the captured moments on the big screen. * The humanoid thinking of the Master Controller is what we intend to achieve in order to derive the maximum value of all the devices. The devices shall in this case act as per my thoughts. UNDERSTANDING THE APPROACH Here we see the Master Controller (MC) connected to all the devices through the Li-Fi ("light fidelity" technology, that can be a complement of RF communication or a replacement in contexts of data broadcasting. It is high speed and bidirectional which carries much more information and has been proposed as a solution to the RF-bandwidth limitations) and Bluetooth, the devices in turn are connected to this common pooled network established by the Master controller. CASE: Peter has been working on his DELL STUDIO for a long time now. The MC device interacts with the laptop to find out the programs Peter had been running in it, the laptop in turns sends the feedback of voluminous...
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...Amazon.com Case The story of how he started Amazon is now legendary. While working at Shaw in 1994, he read a study that predicted the Internet would explode in popularity. He figured it wouldn't be long before people would be making money selling over the web. After researching a host of items that could sell online, he settled on books. Almost every book was already catalogued electronically, yet no physical bookstore could carry them all. In 1994, at the age of thirty, Bezos, a Princeton graduate, quit his job at a Manhattan hedge fund and moved to Seattle to found a company that could ride the exponential growth of the early commercial Internet. (Bezos calculated in 1993, that Internet usage climbed by two hundred and thirty thousand per cent.). Bezos originally thought of calling his company Relentless.com—that U.R.L. still takes you to Amazon’s site—before adopting the name of the world’s largest river by volume. The beauty of the model, Bezos thought, was that it would give customers access to a giant selection yet he wouldn't have to go through the time, expense, and hassle of opening stores and warehouses and dealing with inventory. It didn't work out that way. Bezos quickly discovered that the only way to make sure customers get a good experience and that Amazon gets inventory at good prices was to operate his own warehouses so he could control the transaction process from start to finish. Building warehouses was a gutsy decision. At about $50 million apiece, they...
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...While physical distribution is an asset for Amazon, it is also trying to be a dominant player in the digital distribution of content. Do you think this is a good strategy? Why? Why not? Nowadays we can see a fast development of distribution channels and intake of digital content. We have entered a new period of IT technologies where digital information is playing one of the leading roles together with internet, computer technologies, mobile telephony and evolution of mobile devices. The demand of entertainment and informational content (electronic books, social networks, music, games and video media) spreads through the countries together with mobile devices and PC distribution and becomes more and more vital. You can daily feel its influence on yourself as well. Being a modern person you want to be always available and “keep one's eye on the ball”. Internet became a “must” access resource towards information. We use our mobile phone not only for the voice communication but also as an access to different digital contents (music, video, e-books just to read and for studies, etc.) and social networks (to connect friends and colleagues). To have a better understanding let’s see a J’son & Partners Consulting brief overview on digital media content market, sales via internet and other remote communication channels (distribution via physical devices have not been considered). According to J’son & Partners Consulting research key global digital content market...
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...Amazon.com the Hidden Empire Three digital engines to reshape and dominate retail Amazon.com: a digital shop around the corner… … and a digital colossus. Did you know: all these companies belong to Amazon… Did you know: Amazon is also… AmazonBasics Amazon-branded electronic products AmazonFresh sells and delivers groceries in Seattle AmazonStudios online social movie studio Amazon WarehouseDeals offers discounts on refurbished products Did you know: Amazon has had one of the fastest growths in the Internet’s history… Revenues reached within first 5 years $2,8 bn $1,5 bn $0,4 bn eBay Google Amazon Amazon and eBay results from 1995 to 2000, Google from 1998 to 2003. Even though Zynga and Groupon appear to have an even quicker growth, they haven‟t been compared because 1- sales have not been officially disclosed 2- they haven‟t reach their fifth year Did you know: Amazon Web Services drives these companies… Did you know: Amazon.com is a giant… Y/Y growth for Q1 2011 +38% Market cap $90 bn Customers 137 m 3 × growth of 2 × market cap 2 × # customers E-commerce market Employees 33,700 Annual revenue $34 bn Internet traffic rank 16th Retail brand 1st Paid out $1.2 bn 15 × more than 16% more than before before to buy Source: Amazon.com, Alexa, Brandz. Market capitalization as of April 2011. Why? A vision… From 1994, Jeff Bezos knew he could create a retail website that would not have the limitations...
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...Strategic Management: Principles and Practice Case Study B: Amazon 1) Jeff Bezos founded Amazon in 1995. By 2008, Amazon had truly become a global company with a market capitalization of some US$29.4 billion and 20,700 employees. Its success has been based on a critical success factor consisting of constant technological innovation. This strong sustainable competitive advantage has been placed side by side with a continual effort in catering for the needs of Amazon’s different customer groups. Barriers to Entry If we analyze the online retailing industry according to Porter’s five forces framework, we can state that the industry presents high barriers of entry in terms of technological knowledge/experience and distribution channels. More specifically, the expensive start-up (or switching) and maintenance costs of equipment and expertise often deter new entrants in e-retail business. In terms of government regulation, the online retailing industry may face some issues with national authority restrictions, as is the case of China with the social networking site Facebook, as well as compliance issues on data protection and privacy. On the other hand, the industry presents low barriers in terms of the ease with which an online retailing store can differentiate their products and services offered to a new market. Nonetheless, if the start-up company lacks the technical capabilities and proprietary resources in establishing itself, penetration in such a market is more difficult than...
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