Presented by:

Matt Miceli, Adam Beach, Sydney Early

Company History
Stock Symbol AMZN
CEO Jeff Bezos
Incorporated in 1994 in Washington

Mission / Vision Statement

Mission
We strive to offer our customers the lowest possible prices, the best available
selection, and the utmost convenience.

Vision
At Amazon, our vision is to be Earths most customer centric company; to build a
place where people can come to find and discover virtually anything they want to
buy online

Amazons 4 Guiding Principle

1. Customer obsession rather than competitor focus
2. Passion for invention
3. Commitment to operational excellence
4. Long-term thinking

Key Stakeholders
Internal Stakeholders

External Stakeholders

Employees

Society

Managers

Suppliers

Owners

Shareholders
Customers

Corporate Governance
Board of Directors
Letter to Shareholders
Key Shareholders

Stock Ownership
Non-employees
Jeff Bezos $82,000 salary

Corporate-Level Moves
Horizontal Integration
Major Acquisitions
Zappos - Online Shoes
LoveFilm - Online TV shows / Movies
Kiva Systems - Warehouse robotic systems
Twitch - Video platform for games

Geographic Scope
India Market

Business-Level Integration
Information Technology

Team Liaisons
BOD
Trickle Down System

Span of Control
Functional Level
Tall Structure
Vertical Differentiation
Centralized-Decision Making
Narrow Control

Horizontal Differentiation
Top Level Management is
differentiated
Functions within each unit are
divided by Categories

Integrated Mechanisms
Standardization
Procedures for Departments

Regulation
Governing Actions
Rules and Regulations

Goals
Employees Understand
Company Goals

Mutual Adjustment
Atmosphere

Strategic Controls
Organizational Culture
Refraining from Cohesion
Not Giving Away Too Much Information

Financial Controls
ROE
Stock Price
10-K Report

Strategic Fit
Corporate Level and Business Level Strategies
Low-Cost Leadership Strategy
Standardize Products in Mass Quantities
Unique Products and Services
Highly Specialized and Efficient Jobs
Structured Rules and Regulations

Industry Overview
Amazon is mainly in the E-Commerce and Online Auctions Industry
The industry is comprised of establishments that sell merchandise online
The internet is the main selling platform via either a retailers online store or an
auction site
This industry excludes media and software that is streamed or downloaded
online

Industry Globalization
Is currently low however, the trend is increasing

Barriers to Entry in the Industry

Barriers to entry in this industry are low and are decreasing
Competition: High and Increasing
Concentration: Low
Life Cycle Stage: Growth
Capital Intensity: Medium
Technology Changes: High

E-Commerce and Online Auctions Industry Major Players

The Industry has a low level of concentration, with Amazon dominating
the Industry in U.S. Markets
Amazon has the largest market share at roughly 20%
eBay has the second largest market share at only 0.9%
The rest of the market is made up of corporations that sell products both online
and offline
Examples: Apple, Target, Walmart and Alibaba (mainly foreign markets)

Attractiveness of the Industry

In the five years to 2021, revenue is expected to increase at an annualized rate
of 4.4% to $366.2 billion, with an estimated 4.9% growth in 2017

Opportunities in the Industry

Growth in number of mobile internet connections (2017-2022 est. growth 5.1%)
Younger Generations

Growth in the percentage of services conducted online (2017-2022 est. growth

8.6%)

Low barriers to entry

Threats in the Industry

Dishonest sellers in the market
Possible increases in world price of crude oil
Government Regulations on shipping
Large dependence on per capita disposable income
Potential price wars between competitors

Strategic Group Map of Industry

Opportunities for Amazon from Key Competitors

Opportunities for Amazon
Wal-Mart's Labor Related Lawsuits and Negative Publicity
Wal-Mart faces Increasing resistance from local communities
eBay had the second largest data breach of all time
eBays declining customer base

Threats for Amazon from Key Competitors

Threats for Amazon
eBay is a first mover
Brand recognition for both Wal-Mart and eBay
Wal-Mart's success and increasing acceptance of its Great Value brand
Wal-Mart is exploring possible expansion to new markets and increasing its growth in
the E-Commerce Industry

Generic Business-Level Approach

Cost Leadership Strategy

Entry into E-Commerce Industry

Appeal to all Demographics

Buying and Selling Goods and Services

Offers Wide Variety of Products and

Services

Online Transactions

Product Differentiation

Functional Level Competencies

Economies of Scale
Efficiency
Quality
Innovation
Customer Responsiveness

Focus on B2B and B2C

Low Costs

Investment Strategy
Partnerships and Acquisitions
Audible.com
Zappos
Twitch

Product Innovation
Technological Gadgets
Amazon Drive
1-Click System

Strengths and Weaknesses in Industry

Strengths

Weaknesses

Strong Brand Name

Technology Security

Economies of Scale

Third Party Reliance

Extensive Product Lines at

Low Costs

Little to No Product
Differentiation

Advanced Technology
Capabilities

Low Profit Margins

Channels of Distribution

Dependency on Partners

SWOT Analysis - Internal

Amazons Strengths
Warehouse Engineering

Lean Production

Brand Loyalty

Diversified Geographically

Customer Service

Low Cost Structure

Efficient Delivery Systems

Wide Variety of Merch

Financial Performance

Long-term Investing

Merging into New Market

Economies of Scale

Patented Online System

SWOT Analysis - Internal

Amazons Weaknesses
Intangibility to Brand
Over-diversification
Near Zero Profit Margins (due to Cost Leadership)
Free Shipping
Tax Avoidance Issues

SWOT Analysis - External

Amazons Opportunities
Younger Generations
Internet Accessibility
Acquiring Competitors and Companies
Growth in Online Shopping in China
Growth in Movie Downloads (ex:LoveFilm)
Growth in Cloud Computing

SWOT Analysis - External

Amazons Threats
International Laws and Regulations
Cyber Security and Online Hacking
Large Variety of E-Commerce Competitors
Low Entry Barriers
Dependence on Vendors

SWOT Matrix - S/O Strategy

1st Recommendation Expand globally into Chinese market by acquiring
Alibaba
Strengths

Opportunities

Diversified Geographically
Customer Service
Long-term Investing

Acquiring Competitors
Growth in online shopping in
China

Overseas/Global-Level
Strategy

SWOT Matrix - W/O Strategy

2nd Recommendation Creating Brick and Mortar Retail Stores

Weaknesses
Intangibility to Brand
Over-diversification

Opportunities
Mergers & Acquisitions of
local B&M Stores

Business-Level Strategy

SWOT Matrix - S/T Strategy

3rd Recommendation Investing in Cyber Security Systems & Consultants
Strengths
Long-term Investing
Brand Loyalty (AMZN) is a Big Name
Threats
Cyber Security and Online Hacking

Business-Level
Investment
Strategy

SWOT Matrix - W/T Strategy

4th Recommendation Merge or buy out EBay to gain larger market share
Weakness
Over-Diversification
Threats
Large variety of E-Commerce competitors
Low Entry Barriers

Corporate-Level
Strategy

Questions?