assignment 1 introduction and analysis amazon e commerce company

Amazon introduced its online music and movie businesses, as well as toys and electronics to its marketplace.. Until now, not only does it sell books, music, video, toys, etc., but Amazon

UNIVERSITY OF ECONOMICS AND LAW

FACULTY OF INFORMATION SYSTEMS

ASSIGNMENT 1:

INTRODUCTION AND ANALYSIS

AMAZON E-COMMERCE COMPANY

Supervisor: Mrs Lam Hong Thanh Student: Mai Thi Thu Quyen

Student ID: K214110847 Full name: Mai Thi Thu Quyen Class: K21411C

Ho Chi Minh City, October, 2021

TABLE OF CONTENTS

IPIbN 9) 10 3 LIST OF FIGURES 0.0 3

LIST OF TABLE

Table 2.1 The liquidations processing fee of FBA Liqu1daflons

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LIST OF FIGURES Figure 1.1 The change n Amazon's logo from 1ís inception fo present

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Figure 2.5 Amazon’s worldwide retail e-commerce sales

Services

1994 Seattle, Washington, United States Public

1,298,000 AMZN www.amazon.com

$386 billion

>» Profit | Net income (Dec 2020): $21 billion

1990s when Bezos was researching the internet for D.E Shaw & Co ‘”, a worldwide

investment and technology development business, he realized that books would be an ideal commodity to sell on the internet since book wholesalers already kept digitized listings of their books online However, Bezos' suggestion was rejected by Shaw The corporation was unable to see the future that Bezos could create The future that eventually results in the establishment of Amazon - a perfectly-currently successful company Nonetheless, Bezos still chasing his goal and established the company in Seattle

in 1994 under the name Cadabra, Inc., but the name was changed because it was noticed that people were occasionally mistaken for Cadaver in pronunciation Until July 1995, he named the company Amazon after the Amazon River in South America, hoping that the company's scale would ultimately be big as the Amazon river's vastness, and also because

it begins with the letter A, which will appear at the top of the alphabetical list After months of strategic thought and preparation, Bezos launched the company website Since its inception, Amazon founder, Jeff Bezos, has clarified that its primary goal

is to increase market share in and dominate the areas in which it operates, ignoring short- term profitability In just over a month, the company shipped books to every state in the United States as well as 45 other nations Its early success can be credited to Bezos' hands-

on approach He was so keen for the company to achieve quick momentum that he directly assisted in its delivery operation, helping to assemble orders and driving packages to the post office After going public in 1997, Amazon established itself as a renowned book store by being the sole book retailer on AOL and Netscape's websites This same year, Bezos hand-delivered the company’s one-millionth order to a customer who ordered a

Windows NT manual and a biography about Princess Diana in Japan “

By 1998, the company had begun to broaden its product Amazon introduced its online music and movie businesses, as well as toys and electronics to its marketplace At the same time, the corporation grew overseas Amazon purchased online retailers in the United Kingdom and Germany and the Internet Movie Database (IMDb), which provided Amazon with the advertising resources needed to sell DVDs and videotapes Until now, not only does it sell books, music, video, toys, etc., but Amazon also provides everything that people require, such as clothing, watches, toys, games, baby products, sporting goods, jewellery, garden things, health and self-care items, cosmetic products, musical instruments, foodstuffs, industrial and scientific supplies, and so on Bezos accelerated the product expansion by purchasing Junglee, a comparative shopping site, and PlanetAll, a company focusing on calendars, contact books, and reminders

The years that followed in Amazon's history continue to reflect the company's

tremendous development The company raised $1.25 billion from a bond sale in 1999 ©

In the same year, Amazon collaborated with Sotheby's, an international art auction company, and built distribution centres to speed up the shipment and hold inventory By

the conclusion of this year, the firm had sent 20 million things to 150 countries worldwide 4)

Due to a restructuring plan, Amazon cut 15% of its workforce in 2001 By 2002, Amazon continues to extend its product selection, including apparel from prominent shops such as Nordstrom, The Gap, and Lands End That same year, the firm received ICANN (Internet Corporation for Assigned Names and Numbers) certification, identifying

Amazon as a domain registrar © In 2005, Amazon Prime was introduced This shipping

service assured two-day shipment to consumers from any location for $79 at first and is now $119 per year It had created a great significant influence on retail at that point Amazon launched its first food business in 2006, followed by the Amazon Fresh delivery service, which was available to Seattle residents The Kindle, an electronic and portable book reader, branded Amazon, was introduced in 2007 Because of the success of the Kindle, Amazon announced in 2011 that it was selling more electronic books than physical books ° Aside from that, Amazon created two other websites: Endless.com, which links Amazon users to a portion of their site that sells shoes and accessories, and Askville.com, which allows users to ask questions and receive answers Brilliance Audio was also acquired by Amazon in 2007

Amazon concentrated on the leisure and retail industries in 2008 Amazon Video OnDemand was introduced The corporation purchased The Talk Market, an online shopping startup that assists merchants in creating video commercials, which allow Amazon to grow into the area of apparel as well Amazon purchased Zappos.com, a large online shoe and clothing retailer in 2009 in order to capitalize on the company's mastery

of customer care and its uniqueness

Amazon continues to learn from professionals in various fields by purchasing companies from a wide range of industries and incorporating their technology into their own tactics So, with this method, Amazon's development appears to be limitless, always improving, expanding, and developing

Amazon Studios was started in late 2010 and received more than 10,000 feature screenplay submissions and 1,800 television pilots, of which it has put 17 films and nine

television series into active development “., Content is distributed through theaters and

Amazon Prime Video, Amazon's digital video streaming service, whose competitors include Netflix and Hulu

Additionally, in 2014, Amazon paid $4.6 million for the ".buy" domain, marking their area as the online buying center Following the relative success of the Amazon Fire

HD tablet and Amazon Fire TV, the business also debuted the Fire Phone in 2014 The Fire Phone, on the other hand, was a colossal flop and was discarded barely a year later This mistake in the company's prosperity cost $170 million

Amazon released the Amazon Echo in 2015, along with Alexa, a device that performs as both a speaker and an artificial intelligence assistant Alexa can place orders

on Amazon.com, and play music, answer questions and interact with customers in their daily lives Moreover, by the end of 2015, Amazon became the world’s most valuable

retailer, surpassing Walmart “’ Also, this year Amazon Web Services became the world’s leading provider of Cloud infrastructure services © By 2016, the company had hit $136

billion in revenues

In 2017, Amazon invested $13.7 billion in acquiring Whole Foods in mortar retail

in the digital world Through this intelligence investment, Amazon received a great of consumer data that helped Amazon gain a fuller understanding of the food industry in order to efficiently enter the food market Following the success of Echo device, which had been sold tens of millions and reached more than 100 million paid Prime members globally, Amazon music has been expanded to more than 30 countries Meanwhile, Amazon also launched the Prime Wardrobe, a shopping service that allows you to try

clothes on at home before you buy them “”.

Kindle e-books outsell hardcover books Jul 2010

Mar 2006 Feb2011 Aug 2015

Apr 1998 Feb 2005 ov 2007 Jun 2013 July 5, 2017

Figure 1.2 The milestones of Amazon from 1994 to 2017

In June 2018, Amazon acquired a $753 million for PillPack, an online pharmacy

that allows consumers to buy drugs in pre-made dosages “'”, This highlights that Amazon

aims to play a more direct — and commercial — role in the realm of healthcare in the coming, years In November 2019, the company changed their branding from "PillPack, an

Amazon company" to "PillPack by Amazon Pharmacy" “'” This is also the year in which

Amazon heavily put Alexa into everything They revealed that Alexa's deep neural networks will be improved so that it can comprehend people who are whispering, ask better follow-up inquiries, and learn new languages quicker It can also predict athletic

events and provide answers to math, physics, and engineering questions “?

In 2019, Alexa continued to be the star of Amazon with many new skills and features were announced Although Amazon Studios, the company's film and television production arm launched in 2010, has suffered from movie flops In 2019, Amazon had received eight Golden Globe nominations for movies and streaming shows

Amazon was predicted to be the most significant company in the 2020s after the appearance of Covid 19 in late 2019 Despite the epidemic, Amazon's net profit still

increased This astonishing comes after the company spent more than $4 billion on

"incremental COVID-19 related expenditures in the quarter to help keep staff safe and

deliver items to consumers" ‘) during the epidemic, according to Bezos After full year

2020, Amazon’s net income increased to $21.3 billion, or $41.83 per diluted share,

compared with net income of $11.6 billion, or $23.01 per diluted share, in 2019 #3 By the

end of 2020, Amazon ranked 3rd in the 10 largest technology companies in the world and become the biggest retailer on the planet

Figure 1.3 Amazon History Timeline from inception to 2021

Alibaba Group Holding Limited

» Jingdong Inc

> Newegg Commerce, Inc

> Facebook

1.4.1 Board of Executive Officers

President, Chief Executive Officer, and Chairman of the

Board

Vice President, Worldwide Controller, and Principal

Shelley L Reynolds 56

Accounting Officer

lable 1.1 Executive Officers of Amazon from January 20, 2021

1.4.2 Board of Directors

Former President and Chief Excutive Officer, Marthal’s Table

Chief Executive Officer, Coming Incorporated lable 1.2 Directors of Amazon from January 20, 2021

CHAPTER IT: ANALYZE AMAZON’S BUSINESS MODEL

2.1, Overview of Amazon's business strategy

It might be stated that Amazon's extraordinary success as an Internet retailer in comparison to many of its competitors has been partly attributable to its excellent business model and quick responsiveness to unstop changing market from the inception To begin, Amazon picked the ideal product lines for E-commerce, with things that buyers did not need to hold in person before purchasing: initially books, but then expanding to DVDs, music, cloud computing, and other media Amazon has so focused on diversification and expanding its product offering to broaden its customer base and increase profitability so that the company has placed a significant emphasis on expanding its product library to present customers with various choices Furthermore, having a peer review system, simple checkouts, user-tailored suggested products and making user needs changes proactively makes Amazon one of the best customer-rated online retailers ever

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In 2001, Amazon extended its electronic products and also created computer and magazine subscription shops and developed strategic agreements with merchants such as Target and Circuit City In November 2002, Amazon launched a new online clothing store with merchandise from prominent brands such as The Gap, Cole Hahn, Osh Kosh, Land's End, Spiegel, Old Navy, etc Amazon's diverse business model has enabled it to improve its market capitalization and profitability and become recognized as the world's largest online retailer

The company also focuses on increasing convenience with new features such as

‘Instant Order Update,' which alerts clients if they are going to purchase the same item again Amazon described itself as the "World's Biggest Selection,” aspires to be the world's "most customer-centric company,” functioning via three main basic businesses: Online retail, Marketplace and other, and Third-party sellers Amazon also targeted the institutional sector and consumers in order to create a new source of revenue: renting out its site-building services to other firms When compared to other Internet businesses, Amazon owes much of its financial success to the site-building and hosting services provided to customers such as Borders and Toys R Us

Figure 2.1 Basic business model of Amazon

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Strategic alliances are another important component of Amazon's business model to broaden its range of products and services so the company has entered into a number of agreements by allowing selected strategic partners to sell products and services on the Amazon.com website under co-branded sections These alliances have generally involved Amazon making or having the right to make a minority investment in the companies, as well as the entry into commercial agreements ranging from customer advertising activities and links to their transaction In addition, to develop its travel shop, the firm formed strategic relationships with Hotwire, Expedia, and National Leisure Group, further achieving its diversification goals

Amazon's marketing strategy is one of the most common components of its business model, with the goal of strengthening and broadening the Amazon, increasing customer traffic to its websites, building customer loyalty, encouraging repeat purchases, and developing incremental product and service revenue opportunities In addition, the company's use of strategies such as supplying personalized sites and services, as well as a number of different media, business development activities, and promotional approaches, makes this portion of its business distinctive Amazon also depends on online and conventional advertising, such as radio, television, and print media, as well as direct marketing; nevertheless, one of the key ways the firm attracts people to its websites is via its "Associates Program.” This allows connected websites to offer items to their clients, with fulfillment handled by Amazon, and has proven to be quite successful

2.2, Diver into Amazon business models

2.2.1 FBA Liquidations

This Amazon program assists sellers in recovering the value of surplus inventory and returned products while avoiding storage costs and avoiding inventory disposal Instead of paying a fee to remove or dispose of FBA inventory, you may simply utilize FBA Liquidations to have a wholesale liquidation work on your behalf This service is

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