· Amazon has a large customer base as well as loyal customers.
· GLOCAL strategy: By using this strategy (“Go global & act local”), Amazon is adapting to the culture of the target market seeing as the branding is adjusted locally. In India, Amazon used the “Aur Dikhao” campaign to engage new users and existing users to buy more of their products.
· Amazon has a huge range of products available on their website. The product range has continued to grow seeing as the numbers of third party sellers are increasing.
· Amazon focus a lot on innovation. Technology is a huge source for competitive advantage. It helps with managing their website as well as simplifying the experience for the customers. Amazon invests in innovation in the “cloud business” and has continued to increase its investment in research and development each year
· Amazon’s operating margins are weak. In 2017 the operating margins were at 3.5% and in 2018 3.8%. This is not good if you compare it to Facebook that has 45% (Ovide,2018)
· Some of the innovations (fire phone) made by Amazon did not perform as they expected them to and product failures causes a huge deficit for the company.
• Backward Integration: Amazon can expand their product range with In-house brands as well as differentiate their products. This will benefit them in a highly competitive E-commerce market.
• Another opportunity for faster growth is by acquiring new businesses. Amazon has recently acquired Whole Foods and Ring. By acquiring a new business, the company can expand into new areas that can help grow their business and brand.
· Heavy competition is a huge threat for the company. Ebay, Alibaba and Walmart are some of the main competitors. Amazon provides Cloud services where they face solid competition from companies like Microsoft, Oracle and Salesforce
· Legal and regulatory pressures are creating a strain for big technology company’s like Amazon. In the EU the environment is changing fast and the companies have to adjust accordingly. In 2017 Amazon had to pay a fine of 250 million Euros due to tax avoidance.