1. Customers
Who are the current customers/users? Include information related to demographics, psychographics and buying behavior, price sensitivity, customer satisfaction and loyalty.
For example: You could include information such as whether the brand is trying to appeal to a certain social or cultural group and how customers perceive the product/brand. It's also possible to include demographic information related to: age, educational attainment, geographic area, gender, race, employment status and/or home ownership. Additionally, you can discuss psychographic information which includes those attributes that relate to personality, values, attitudes, interests, or lifestyles of people. This area is also related to situational life stages as well as customer beliefs, and how customers want to see themselves and be perceived. Some examples of psychographic groups include video gamers, soccer moms, sports fanatics, hipsters, and single moms. Life cycle stages include: retirees, new homeowners, college students and new parents. Be aware that some products/brands may appeal to a wider customer base than others.
What do the customers buy/use?
What changes can the company/brand expect in the future? How can the company/brand better serve its customers? Include information about potential opportunities and threats.
For example, you could include information about the current demand for the product/brand, and how it is changing or has changed including possible variations or modifications in the future. You may also determine/discuss if the brand/company can take advantage or has taken advantage of the changes. It's also possible to consider and talk about whether the product/brand is a less expensive substitute, perhaps, or maybe a product/brand that is easier to use with more features.
[Insert response]
2. Company
Identify strengths and weaknesses of the company/brand as it exists today. What does the company/brand do well and not so well at this very moment?
[This is what the company/brand needs to become.]
How can the company/brand improve its weaknesses and maintain or grow its strengths? Suggest how the company/brand can improve upon the things it does well and not so well.
3. Context
Define the current business environment. Include information about political, legal, economic technological and societal factors that may influence sales.
For example: You could perhaps discuss the current trends and conditions for this Industry and for the brand. It's possible to include information about how the Economy affects this industry. This could include changes in income: are people losing jobs, or getting paid more? Changes in spending habits could be considered as well. Other factors such as use of public transportation and shopping online may also be relevant. Whether or not the product is high-tech, or state-of-the-art can be also be included in describing the context. For example, are there other companies producing new versions of the product? Is the market changing quickly? How is technology affecting this product or service? Are there any new laws that may affect the brand?
4. Collaborators
Define the business partnerships. Does the company/brand have any current partnerships? What other company/brand may be a good partner for them?
5. Competitors
Who are the main competitors?
6. Recommendations
Based upon the analysis you just completed in this worksheet, what are three (3) key recommendations that you could pass along to Management regarding the future direction of the company you selected?Based on what you've learned so far in this course, regarding the 5 Cs, 4Ps, and STP, complete the assessment questions below. Submit the completed template in the Week 10 assignment
submission link.
1. Customers
Who are the current customers/users? Include information related to demographics, psychographics and buying behavior, price sensitivity, customer satisfaction and loyalty.
For example: You could include information such as whether the brand is trying to appeal to a certain social or cultural group and how customers perceive the product/brand. It's also possible to include demographic information related to: age, educational attainment, geographic area, gender, race, employment status and/or home ownership. Additionally, you can discuss psychographic information which includes those attributes that relate to personality, values, attitudes, interests, or lifestyles of people. This area is also related to situational life stages as well as customer beliefs, and how customers want to see themselves and be perceived. Some examples of psychographic groups include video gamers, soccer moms, sports fanatics, hipsters, and single moms. Life cycle stages include: retirees, new homeowners, college students and new parents. Be aware that some products/brands may appeal to a wider customer base than others.
The current customers/users of Amazon are college students, online shoppers, and customers who are looking and wanting great items at a reasonable price. Amazon is the go to site for college students who want and need college books at a reasonable prices. College students have enough pressure with studying, making good grades, and maintain this thing called "life." Expensive books at the campuses' book store should not be a part of their stress. Amazon takes the stress off students when shopping for books. Amazon is great site for online shoppers. Amazon is my go to site because I don't have to deal with the hassle of different sellers or worrying about what I see online is actually what I'm going to receive after paying. Amazon also has reasonable on most of their products. Amazon is for anyone who is looking for a particular item at a decent price.
What do the customers buy/use?
Customers can buy anything such as books, electronics, clothes, home décor, beauty, accessories, movies & tv, office products, sports & outdoors, tools, toys & games, musical instruments, luggage & travel gear, and even wine. Customers can use whatever they purchase from Amazon.
What changes can the company/brand expect in the future? How can the company/brand better serve its customers? Include information about potential opportunities and threats.
For example, you could include information about the current demand for the product/brand, and how it is changing or has changed including possible variations or modifications in the future. You may also determine/discuss if the brand/company can take advantage or has taken advantage of the changes. It's also possible to consider and talk about whether the product/brand is a less expensive substitute, perhaps, or maybe a product/brand that is easier to use with more features.
Amazon's opportunities are:
1. Backward Integration: Amazon can come up with its In-house brands in different product categories. They can also differentiate their offering. This will help them make profits in highly competitive E-commerce market.
2. Global Expansion: Expansion mainly in Asian & developing economies will help Amazon because those are the markets with low competition in E-commerce industries & are not saturated like developed economies.
3. Acquisitions: By acquiring E-commerce companies it can decrease the competition level & also can use the specialized capacity of the other company.
4. Opening physical stores outside U.S: By doing this Amazon can help the customers to engage with the brand, resulting in increase in repeat purchases & increase in loyal customer base.
Amazon's threats are:
1. Low entry barriers of the industry: Low entry barriers affect the current player's business as more & more company means tough competition, price wars, shrinking margins & losses resulting into questioning the sustainability of the players.
2. Government regulations: Not having clarity on the issues related to FDI in multi brand retail, has been a big hurdle in the success of the E-commerce players in many developing nations.
3. Local competition - India has snapdeal and Flipkart who are local E commerce retailers and are taking away majority of the market. Similarly, there are many local players who take bites from the market share thereby making it hard for a big player like Amazon to
make profits.
(Marketing 91, 2016)
2. Company
[This is what the brand is currently.]
Identify strengths and weaknesses of the company/brand as it exists today. What does the company/brand do well and not so well at this very moment?
One of Amazon's strength is low cost structure, the largest merchandise selection and a huge number of third party sellers. Amazon is the largest online retailer in the world. In 2014, the company earned more than US$80 billion purely from online sales, more than any other retailer in the world. At the current growth rate Amazon will become the 2nd largest retailer (as measured by revenue) in the world, behind Wal-Mart by 2018. Another strength is selection. According to Monsoon Commerce, Amazon sells around 339.7 million of stock keeping units (SKU's) in its Amazon.com Marketplace. In comparison, Walmart offers only 8 million SKU's in its online shop, or just 2.35% of the number of products that Amazon offers. This vast difference in range is the reason why online customers are more likely to visit Amazon.com rather than Walmart's e-shop. Third party sellers is another strength of Amazon. Amazon's business model includes accommodating third party sellers who are able to offer their own merchandise on Amazon's sites and whose products therefore compete against Amazon's. Third party sellers are mainly attracted to because of the high volume of traffic on Amazon sites. They often offer products that are not available through Amazon's retail division. More than 2 million third party sellers account for more than 40% of the total units sold on Amazon's sites. eBay is the only other online company that has as many third party sellers as Amazon. (Strategic Management in Sight, 2016) Amazon's weaknesses are:
1. Shrinking margins: Due to extensive delivery network & price wars Amazons margins are shrinking, which is resulting in even losses. In India, Amazon had a loss of $359 crs in the year 2013-14.
2. Tax Avoidance issue: Amazon has attracted negative publicity on account of Tax Avoidance in countries like U.S & UK. Most of its revenue is generated from these well established markets.
3. High Debt: In many developing nations Amazon is still struggling to make the business profitable thereby affecting the overall profitability of the group resulting into High debt.
4. Product flops - Amazon launched the fire phone in the US which was a big flop. At the same time, Kindle fire did not pick up as strongly as Kindle did. Thus, there were several product flops which caused a dent in Amazon's deep pockets. (Marketing 91, 2016)
[This is what the company/brand needs to become.]
How can the company/brand improve its weaknesses and maintain or grow its strengths? Suggest how the company/brand can improve upon the things it does well and not so well.
Amazon can improve its weaknesses by simply reflecting on their weaknesses. One of their weaknesses were shrinking margins. This weaknesses is odd to me because I wouldn't think that shrinking will be an issue for an online shopping site.
3. Context
Define the current business environment. Include information about political, legal, economic technological and societal factors that may influence sales.
For example: You could perhaps discuss the current trends and conditions for this Industry and for the brand. It's possible to include information about how the Economy affects this industry. This could include changes in income: are people losing jobs, or getting paid more? Changes in spending habits could be considered as well. Other factors such as use of public transportation and shopping online may also be relevant. Whether or not the product is high-tech, or state-of-the-art can be also be included in describing the context. For example, are there other companies producing new versions of the product? Is the market changing quickly? How is technology affecting this product or service? Are there any new laws that may affect the brand?
The business environment is the combination of internal and external factors that influence a company's operating situation. The business environment can include factors such as: clients and suppliers; its competition and owners; improvements in technology; laws and government activities; and market, social and economic trends. (Business Dictionary, 2016)
4. Collaborators
Define the business partnerships. Does the company/brand have any current partnerships? What other company/brand may be a good partner for them?
Business partnership is a type of business organization in which two or more individuals' pool money, skills, and other resources, and share profit and loss in accordance with terms of the partnership agreement. In absence of such agreement, a partnership is assumed to exit where the participants in an enterprise agree to share the associated risks and rewards proportionately. (Business Dictionary, 2016) AWS is one of the partners of Amazon. The AWS Partner Network (APN) is the global partner program for AWS. It is focused on helping partners build a successful AWS-based business by providing great business, technical, marketing, and GTM support. (Amazon Web Services, 2016)
5. Competitors
Who are the main competitors?
Amazon Inc. (AMZN) is a multinational consumer electronics company and the largest Internet company in the United States as of November 2014. The company also sells a great deal of other consumer goods. Amazon.com operates in three general segments: media, electronics and other merchandise. In the media segment, Amazon competes with auction site eBay (EBAY); media game-changer Netflix (NFLX); Time Warner Cable (TWX); Apple (AAPL), with iTunes; Google (GOOG) with its Play Store; and media producer Liberty Interactive (QVCB). Amazon has several competitors in the electronics and general merchandise segment, many of which are brick and mortar rivals including Best Buy, Family Dollar, RadioShack, Staples, Target, Walmart, Sears, Big Lots, Delia and Systemacs. In the electronics and general merchandise segment online competition includes Alibaba Group, LightInTheBox Holding Co., Overstock.com, PCM, Vipshop Holdings, JD.com, Wayfair Inc. and Zulily. In the other operating segment, Amazon competes with several of the world's largest companies including CDW, PC Connection, Insight Enterprises, Google, Oracle; salesforce.com, Accenture and Citrix Systems, among others. For its 2013 fiscal year Amazon reported $74.45 billion in revenue, and it has a market capitalization of $153.37 billion as of Nov. 20, 2014. Analysts' street consensus estimates see the online retailing pioneer reporting $89.49 billion in revenue for 2014. The company is also expected to report a loss for 2014 and return to profitability in 2015. (Investopedia, 2016)
6. Recommendations
Based upon the analysis you just completed in this worksheet, what are three (3) key recommendations that you could pass along to Management regarding the future direction of the company you selected?
1. Be aware of the companies weaknesses and threats
2. Identify the weaknesses and threats and come up with a strategy to improve the weaknesses and threats
3. Continue to keep the strengths and opportunities positive and up and numbers.