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Running Head: AMAZON INTERNAL AND EXTERNAL ENVIRONMENT ANALYSIS

Amazon Internal and External Environment Analysis

Student’s Name

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AMAZON INTERNAL AND EXTERNAL ENVIRONMENT ANALYSIS

Table of Contents
1. Executive Summary.............................................................................................................................3
2. Existing mission, objectives, and strategies.............................................................................................4
a) Amazon’s Mission Statement..........................................................................................................4
b) Amazon Objectives and Strategies...................................................................................................4
I. Customer Obsession..........................................................................................................4
II. Passion For Invention..........................................................................................................5
III. Commitment To Operational Excellence...............................................................................5
IV. Long-Term Thinking..............................................................................................................5
3. New Mission Statement......................................................................................................................6
4. Analysis of the firm’s existing business model.....................................................................................8
References...................................................................................................................................................9
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1. Executive Summary
Amazon Company operates in an environment where creativity and innovation are

critical for success. The company has ensured they adopt a business strategy that is aimed at

meeting the company’s core values. Amazon’s primary focus has always been the customers

whom they serve. They have ensured that every business strategy employed in the company is

aimed at addressing the concerns of their customers. They are using the four focus areas, which

include customer obsession, passion for invention, commitment to operational excellence, and

long-term thinking.
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2. Existing mission, objectives, and strategies

a) Amazon’s Mission Statement
Amazon’s mission statement has always been centered towards its primary focus, which

is the company’s online customer. Amazon’s decision-making process has always focused

mainly on how best to make the customer feel comfortable and how best to meet customer needs

(Amazon, 2018). Amazon’s success has come about based on the company’s primary focus on

the customer. The company’s vision and mission statements fully show its commitment to its

customers.

b) Amazon Objectives and Strategies

Amazon Company’s primary objectives have always been to primarily focus on their

customers. According to the company’s annual report in 2018, Amazon has identified four areas

which are their primary focus which includes the following

I. Customer Obsession
Amazon has always been about customer obsession rather than competitor focus. Since

the company’s inception in 1997, Amazon has ever made its primary focus be on the customer.

According to Mullaney (2017), Amazon mainly focuses on how to improve their customer

experience. Rather than focus on what competitors are doing, Amazon has invested more in

understanding its customers and offering what they want. Amazon does this by carrying out

numerous research about their customers. They always send customer surveys to try and listen to

what their customers are saying or what they think. They have a team of researchers and experts

all who are geared towards using such critical information and coming up with business

strategies that meet customer needs and preferences. According to Jeff Bezos, Amazon CEO,

focusing on the customer has enabled the company to be a market leader (Premack & Cheong,

2019). It means that Amazon’s strategy has ensured that they lead the way as others follow.
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II. Passion For Invention
Just like the company has invested in understanding their customers, Amazon has also

perfected the art of being more innovative and creative than its competitors. Premack and

Cheong (2019), reports that the company’s CEO believes that following current trends do not

lead companies anywhere. Any severe company like Amazon should be at the forefront of

coming up with creative and innovative ways of doing business. Creativity should be modeled

around the need to meet consumer needs while also creating more value for them. They focus on

a need and invent solutions to such needs so that the company can continue being relevant to its

customers.

III. Commitment To Operational Excellence

The secret to success for any organization is always operational excellence. Amazon, as a

company, has focused on setting high standards when it comes to operational excellence.

Numerous processes occur at amazon before any products are shipped out to consumers. The

company has invested in tamper-proof systems that have been tried, tested, and updated several

times to improve on excellence (Tabaka, 2019). Amazon’s processes involve a wide range of

activities, including the use of human labor, technology, and many more factors. All these factors

are fused to ensure the smooth running of company activities. The ultimate goal for the stable

operations at Amazon is so that the customer can receive the best form of service (Caporaso,

2018). The operations are also done in a way that they are less expensive, so that they do not

interfere with the final price. Investment in technology has ensured these processes save both

time and money for the customers.

IV. Long-Term Thinking

According to Jeff Bezos, when he was starting Amazon, he did not look at the short-term.

He had a long-term vision, which he believed would finally pay dividends. Currently, Amazon is

the world’s most significant online retailer, thanks to this long-term vision (Caporaso, 2018). The
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company’s business model is based on coming up with a strategy that is to be implemented

continually for several years to find out its suitability. Instead of trying out new models every

time they fail, Amazon mainly focuses on improving their models and ensuring it picks up with

time.

3. New Mission Statement

 Customers: Amazon’s primary business strategy has always been to create a one-

stop-shop for everything under the sun. What this means is that amazon targets all

customers around the world. Amazon’s customer, therefore, is all seven billion-plus

people around the globe (Rossman, 2016). The company strives to ensure these

customers can find everything they are looking for through Amazon platforms

 Products or services: Amazon has adopted a similar approach to the products they sell

by providing they sell everything. The company, in a bid to reach out to as many

customers worldwide as possible, they have embarked on making all types of goods

available in their platform (Chaffey & Ellis-Chadwick, 2019). The company,

however, has a strict policy of ensuring all the products and services sold in their

platform are of the right quality and value. They also offer competitive services,

which is very critical towards remaining on top.

 Markets: Amazon is an American company with most of its business activities

happening in North America. However, the company has a presence in all the five

continents of the world. The bulk of the company’s operations, however, are in North

America and Europe (Caporaso, 2018).

 Technology: Amazon, together with Facebook, Google, and Apple, are regarded as

the big four tech companies in the world. The company relies mainly on technology
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since its primary operations happen online (Caporaso, 2018). The company ensures

that all its systems are technologically current, and they have massively invested in

cybersecurity to minimize any threats.

 Concern for survival, growth, and profitability: Amazon Company is primarily a

retail company. It uses a sales revenue model where it earns a small percentage from

all goods and services sold within its platform. The company currently appears as

number 8 in the Fortune 500 list of US companies by revenue. As of the year 2019,

Amazon recorded up to $280.52 billion in revenue, which represents growth from the

previous year (Tabaka, 2019). The company’s primary business model is focused on

growth and financial soundness while also meeting its primary goals to the customer.

 Philosophy: Amazon operates with the belief that service to their customers is their

key to success. The company has a philosophy of focusing on the needs of their

customers and delivering on such needs (Roemmele, 2017). The company’s major

priorities are to offer the best value to customers by insisting on high quality and

standards.

 Self-concept: According to the company CEO, Amazon’s success has been attained

mainly by the company’s long-held strategy of focusing on the customer at the

expense of competitors. Amazon ensures that they apply their creativity to become

innovative in the market, therefore, becoming market leaders.

 Concern for public image: Amazon’s strategy of customer focus has led to the

company being the most responsive to consumer needs. The company maintains a

massive social media, community, and environmental presence where they engage in

numerous activities aimed at giving back to the community.

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AMAZON INTERNAL AND EXTERNAL ENVIRONMENT ANALYSIS
 Concern for employees: Amazon has ensured that its employees are among the

highest-paid employees around the world. The company has provided that they share

most of the profits they earn with their customers (Rossman, 2016). However, the

company has faced criticism for the automation of most of its services, thereby

rendering most casual workers jobless.

4. Analysis of the firm’s existing business model

A. Reselling: Amazon’s most common business model is to resell certain products on their

website. They purchase products in high quantities, thereby gaining on economies of

scale then sell the same products to individual consumers (Chaffey & Ellis-Chadwick,

2019). They buy low and sell high and pocket the difference. They also collaborate with

manufacturers and wholesalers who give them better deals.

B. Dropshipping: most shoppers prefer Amazon due to their ability to deliver products to a

customer’s convenience (Chaffey & Ellis-Chadwick, 2019). Once a customer has

identified a product online and made purchases, Amazon undertakes the process of

delivering that product to the customer.

C. Involve stakeholders: Amazon runs several strategies aimed at working with

stakeholders, including affiliate marketers, manufacturers seeking to sell directly to

clients, and many more (Chaffey & Ellis-Chadwick, 2019).

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References
About Amazon Staff. (2020). Our Leadership Principles. Amazon. Retrieved from

https://www.aboutamazon.com/working-at-amazon/our-leadership-principles

Amazon. (2018). Annual Report. Retrieved from https://ir.aboutamazon.com/static-

files/0f9e36b1-7e1e-4b52-be17-145dc9d8b5ec

Caporaso, T. (2018). 100 Million Reasons Why Customer Focus Has Paid off for Amazon.

Nasdaq. Retrieved from https://www.nasdaq.com/articles/100-million-reasons-why-

customer-focus-has-paid-amazon-2018-05-02

Chaffey, D., & Ellis-Chadwick, F. (2019). Digital marketing. Pearson UK.

Mullaney, T. (2017). 5 key business lessons from Amazon’s Jeff Bezos. CNBC. Retrieved from

https://www.cnbc.com/2016/05/13/5-key-business-lessons-from-amazons-jeff-bezos.html

Premack, R. & Cheong, W. (2019). Jeff Bezos credits Amazon's trillion-dollar success to one

'secret sauce' — an 'obsessive compulsive focus' on customers over competitors. Business

Insider. Retrieved from https://www.businessinsider.com/amazon-jeff-bezos-success-

customer-obsession-2018-9?IR=T

Roemmele, B. (2017). What Is Jeff Bezos's "Day 1" Philosophy? Forbes. Retrieved from

https://www.forbes.com/sites/quora/2017/04/21/what-is-jeff-bezos-day-1-

philosophy/#422f96071052

Rossman, J. (2016). The Amazon Way on IoT: 10 Principles for Every Leader from the World's

Leading Internet of Things Strategies (Vol. 2). Clyde Hill Publishing.

Tabaka, M. (2019). Amazon's 4 Keys to Success, According to Jeff Bezos. INC.com. Retrieved

from https://www.inc.com/marla-tabaka/jeff-bezos-says-these-4-principles-are-key-to-

amazons-success-they-can-work-for-you-too.html