Often, as businesses grow, they lose that ability, and as soon as they do, it’s often the beginning of the end. Amazon Inc, has been experiencing rapid growth including penetrating different markets across the globe. Amazon has been harnessing aggressively its merger and acquisition strategy, as it closed 30+ deals in the past five years. Or don’t, and you’ll be like Blackberry, Kodak, Blockbuster, and other brands that failed to innovate. Amazon Strategic Analysis. The latest updates from The KPI Institute |  The industry is replete with such examples where firms have used one or more of these strategies for competitive advantage. Rank Well On Google & Maximize ROI. How do you ensure, once they’re there, that they use it? What are these intensive growth strategies through which Amazon has reached such heights in the world of online retailing? This tape is strong enough to hold the box shut, but it’s easy to open with your bare hands. In his article, Amazon.com Inc.’s Generic Strategy, Intensive Growth Strategies, Nathaniel Smithson offers a very good example through which he illustrates Amazon’s success: What are these intensive growth strategies through which Amazon has reached such heights in the world of online retailing? Now, guided by the book, Be Like Amazon: Even a Lemonade Stand Can Do It, we have the framework for your business to do just that: set the standard for your own industry in the same way Amazon does it for its own. And they’ll keep you focused on what matters most, guiding your decisions, your priorities and your day-to-day operations. The brand has continued to see very fast growth and has come a long way since its inception. For physical products, how can you make something as mundane as the packaging a memorable experience? The 4 pillars are about creating an Aha! You focus on building your brand. For digital products, how can you create delight and an intuitive experience accessing your product? One strategic objective based on this intensive growth strategy is to increase research and development investment, which can lead to rapid product development and quick release on the online retail market. Be Like Amazon: Even a Lemonade Stand Can Do It, How to Master Product Photography on a Tight Budget (We Did it With Less Than $50), How To Write Product Descriptions To Grow Sales [Samples Below + Updated in 2020], Ecommerce Shipping: Your Step-by-Step Guide to Shipping Profitability, The Complete Guide to Advertising on Facebook: Strategies That Convert [in 2020], Evolving Ecommerce: 14 Trends Driving Online Retail In 2020. Amazon.com: SEO for Growth: Strategies to Stay Ahead in the Changing World of Digital Marketing. Amazon’s primary intensive growth strategy. The chart below summarizes the M&As of Amazon since 2014. Clearly, Bezos understands that the customer experience doesn’t end when UPS delivers your order. Cookie Policy, The KPI Institute’s 2020 Agenda is now available! This tool helps organization identify growth approaches in four keys areas. As Amazon identified potential strategy options, it developed evaluation criteria and rated various alternatives. Amazon is the largest online retailer and has found very sharp growth in the recent years. Both had free two-day shipping (something Amazon has forced so many online businesses to do by being so dang good at it). Then, the toy was further packaged in clam-shell packing that’s impossible to open. As an example, after a Kodak employee invented the digital camera in 1975, management promptly killed it. This is the final intensive growth strategy employed by Amazon. Wherever he wanders, he likes to leave room for inspiration, preferring “loose” meeting agendas over rigid ones. Amazon approaches emerging markets and technologies as a growth investor does, looking for blockbuster returns that will offset the flops that … Only after reviewing it from the customer’s perspective can they talk about code or get input from designers. Amazon's stock will no longer depend solely on revenue growth as the company focuses on non-retail segments to improve margins.The online store sales growth … This is about coming up with new ideas and new ways of doing things, but not for the sake of creativity or impressing stockholders. Let us future-proof your backend. The growth of Amazon itself is partly influenced by the development of new products. Innovation. Today, no one turns to Blackberry for business advice. The objective in applying this intensive strategy is growth based on new business. Amazon strategies by expanding their business and service aggressively, to the point that they will embrace minor profit margins or experience losses for the "rapid growth." For instance, Amazon puts a chair in every boardroom to represent the customer — a physical reminder to innovate on their behalf. We’re on a mission to provide businesses like yours marketing and sales tips, tricks and industry leading knowledge to build the next house-hold name brand. 25 Amazon focuses on keeping the customer happy and customizing products that would appeal to the customer. how to produce content that sells more). Is it any surprise they filed for bankruptcy in 2012? Optimization is about improving processes so you can become more efficient and bring more value to your customers. It includes frustration-free packaging and your first impression of the product itself. Amazon Acquisition Strategy. Written by Maria Juncu on July 24, 2019. Amazon’s 4 pillars are designed to keep your focus where it belongs: on the foundational principles that spur growth and profits. Amazon goes public at $18 per share, giving it a valuation of $300 million.      |      So within minutes of delivery, Eisenberg’s kids had ripped open the box and were playing with their new toy. We haven’t got an unlimited budget, a fleet of drones, or 43% of market share. Like many of its other initiatives, Amazon is going all-in on voice and is determined to offer the best and most compelling selection of products. One way for Amazon to counter this could be through increasing the number of Prime customers, as there is a “huge difference” in their AOV compared with non-Prime customers. While we all aim to imitate Amazon, can we really be like them? Amazon’s third, supportive intensive strategy for business growth. These four intensive growth strategies are part of the reason why Amazon has risen above its competition and has succeeded in becoming a worldwide leader in the online retailing space, staying true to its vision statement: “To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online.”, Tags: Amazon, Business Strategy, Growth performance, Strategy, Copyright © 2004-2020 The KPI Institute Pty. Amazon – the online retail giant – is omnipresent when it comes to eCommerce news. For Bezos, customer centricity is WIIFM on steroids. You’ve heard of WIIFM, or what’s in it for me, right? According to Nielsen's "What's In-store for Online Grocery Shopping" research (January 2017), findings show us the rate of growth in online grocery shopping.According to the results, the percentage of consumers who prefer home delivery was 25% in 2014, and it is 29% in 2016. That box required a knife to cut through the tape. If you are interested in advertising with Performance Magazine, leave your address below or contact us at: marketing@smartkpis.com. Amazon is dependent on its consumers, which is why when consumerism grows, the business by default grows. It happens anywhere you creatively serve your customers, from your office cubicles to your meeting rooms. Omnichannel Strategies / Selling on Amazon. From messaging to packaging and returns, from your business operations to how your bathrooms are cleaned, there’s always room for improvement. Amazon’s secondary intensive growth strategy. ... For a look at the firm’s U.S. marketing strategy, I recently asked Trever Gregory, VP marketing at Rakuten Rewards to fill us in. In Be Like Amazon, authors Jeffrey Eisenberg, Bryan Eisenberg and Roy H. Williams lay out 4 core principles that are responsible for Amazon’s explosive growth. The next thing that stood out was his experience when the boxes arrived in the mail. Required fields are marked *. True innovation is about bringing value to your customers — because innovation that doesn’t benefit and serve your customers won’t help you grow. Here’s an overview of Amazon’s strategy in 2019, and what retailers can learn. Profits become the highest priority, and innovation and optimization grind to a halt. Watch the interview above to see what Ryan Deiss and Bryan Eisenberg discussed around the 4 Pillars of Amazon’s Success last time Bryan stopped by the DigitalMarketer office! This shows us that the company makes use of acquisition to implement this intensive growth strategy. Introduction: Amazon, the leading e-commerce brand of the world, led by Jeff Bezos was first incorporated in Washington in 1994 and again in Delaware in 1996. They work equally well for digital and physical businesses. Being like Amazon isn’t a matter of size or budget or nifty technological gadgets. Techies everywhere fell in love, and Blackberry quickly became the leading hand-held device. The Amazon Of Japan Looks For U.S. Growth. The MarketWatch News Department was not involved in the creation of this content. But innovation isn’t confined to radical new ideas. Whether she's covering Amazon or start-ups, she's always up to speed on the newest working trends in commerce and content. Corporate agility is about speed of execution, the ability to remain flexible and adaptable regardless of your business’ stage of growth. Amazon has been and still is to this date a pioneer in the online retailing space and the world’s largest online retailer. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Amazon. This article analyzes the generic strategy used by Amazon and the intensive strategies it has used to find growth in the market. But Amazon's growth strategy could take a cue from Google Travel, a metasearch engine that competes with sites such Kayak. Growing the e-commerce business through an aggressive acquisition strategy is another strategic objective associated with this final growth point. The company recently launched its international shopping ‘wing’. As a test, Bryan Eisenberg ordered a Rubik’s Cube from a popular toy store and from Amazon. Bezos' company is benefitting from surging e-commerce growth during the pandemic. Amazon, is after all, the most customer-centric company is the world. – Part II, Marketing, Storytelling and how some ideas were Made to Stick. This strategy aims to generate more revenue from markets where the company currently operates. Online sales of groceries have tripled as consumers went online in large numbers to buy food during the coronavirus pandemic, and Amazon increased its grocery delivery capacity by 160%. At the same time, Amazon can focus in minimizing the possible weaknesses and threats to make its … The KPI Institute’s 2020 Agenda is now available! Ltd. All rights reserved The company can benefit from higher sales revenue, if they succeed in increasing consumers’ interest for online retail shopping. Amazon Growth Strategy Recommendations. It may sound daunting, but that might not be as hard to do nowadays, considering the popularity of the Amazon brand. It uses technology to its advantage in setting the prices. Your email address will not be published. Amazon's Aggressive Growth Strategy by Felix Richter, May 24, 2013 Amazon Amazon has been one of Wall Street’s darlings in the past decade. The consumer shift to online grocery shopping is increasing, and Amazon is already there. Not so with the toy-store packaging. Here’s how Bezos has explained his approach to innovation: “I like to wander” down the paths of ideas. In July 2020, Amazon reported a 43.4% increase in North American sales and 33.5% worldwide revenue growth in the second quarter of 2020. It’s an innovation in and of itself. Amazon’s success is proof of its competitiveness, and its growth & expansion are the result of the company’s intensive growth strategies. Their revolutionary iOS reinvented how devices should operate, and it didn’t take long for Blackberries to become obsolete. Mobile First Index, AI, Google Snippet, Content & Influencer Marketing eBook: Bartnik, Matthew: Kindle Store Entry and growth in new markets is the main objective in this intensive strategy. Given Amazon's traditional role as a marketplace owner and facilitator, the latter option could be more likely. Amazon’s generic corporate strategy can be described as concentric diversification. moment after your sales?”. However, the shift is slow. Amazon's Use of Ansoff Matrix Strategy Tool. 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