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Amazon Strategy

In: Business and Management

Submitted By leonlhy
Words 383
Pages 2
Amazon’s strategies
The online retail line of business includes those products sold by Amazon as a traditional retailer, most commonly as a low-cost retailer. Amazon claims to have "Earth's Biggest Selection" of products available through its family of websites, sold at the lowest cost at a small profit. The company started as an online book seller, rapidly expanding into music and movies, and ultimately into electronics and household goods.
But Amazon doesn't stock everything that is sold through its website. Another part of its retail strategy is to serve as the channel for other retailers to sell their products and taking a cut of every purchase. Amazon maintains its status as a destination website, but does not have to maintain inventory on slower-selling products. This strategy has made Amazon a leading long-tail retailer, expanding its available selection without a corresponding increase in overhead costs.
Extending this long tail retail model further, Amazon introduced the sale of used products through its seller marketplace. Originally developed to compete with eBay, the seller marketplace provides another retail revenue stream for the company without the need to stock products in its warehouses. Advertising and shipping are handled exclusively by sellers, with Amazon taking a cut of every sale simply for providing the channel.
Amazon's internet services cannot easily be discussed as a standalone line of business because it is deeply intertwined with both its retail business and the Kindle ecosystem. From the consumer perspective, Amazon has begun to provide services like Amazon Prime, which provides free two-day shipping on retail purchases, on-demand video streaming, and free access to the Kindle library, all for an annual fee. Amazon Prime overlays the subscription and all you can eat business models with the retail model to provide additional customer

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