KINDLE

FIRE
Amazon’s Heated
Battle for the Tablet
Market

GROUP 5
Annmaria Sunny - PGP/24/130
Kavyashree S - PGP/24/152
Laya - PGP/24/155
Mohammed Ishaan K B - PGP/24/161
Nandhini Balu - PGP/24/162
 Who should Amazon Kindle target?
Which target segments and use cases are promising?
Media Junkies Children and Higher Heavy Travellers
Gamers Education
Tech savvy people who There weren’t many Student are tech savvy Kindle Fire being a
rapidly consume handheld devices that hence this device could be compact, portable and
multimedia content from appealed to the children adopted easily easy to handle device will
numerous channels and children heavily allow travellers to
influenced the purchasing Students would prefer to consume a variety of mass
behaviour of their parents carry a digital device with media content from
Bargain prices and huge
all their study material in a reading to watching
selection attracts these
Parents were reluctant to single place rather than movies and playing
price conscious
give their children high carrying heavy backpacks
individuals games, thereby making it
priced tablets and convenient and increasing
Amazon’s cheaper priced Digital books are
Having tens of thousands the productivity of
and rugged tablet addressed reasonably priced as
of books, magazines, travellers
the issue compared to textbooks
music and movies in one
affordable handheld Handheld gaming was Hence if adequate content
device would make the becoming the fastest is provided in Kindle, many
customers compromise on growing market for gaming students would switch to
Kindle’s smaller screen and Amazon could use this this digital offering for their
transformation to target the studies
How should Kindle position relative to iPad and other E-readers ?

Kindle E-reader was launched to overcome the existing pain points such as slow and clunky operations and existing poor
usability issue. So Kindle was successful in addressing these pain points and kept on improving user experience, lowering the
cost and creating an ecosystem for Amazon ebooks.

Kindle’s focus was on avid Kindle Fire is placed directly against Nook and indirectly against Ipad in the
readers and made it a point to market.
give them more content in an
interactive device. This
approach helped them to acquire Kindle vs Nook : Nook and Kindle Fire were similar on various aspects such as hardware
more consumers and retain features and especially in pricing strategy. Whereas Kindle differentiated itself in user
existing ones. experience and integrating other services like silk web browsers and cloud based
As Amazon is the leader in new services.
books this can be used to sell Kindle vs Apple’s Ipad : Kindle was priced at three to four times lower price than Ipad,
new books and at read textbooks and provided a better user- friendly and end to end experience. So basically Kindle was
at low price to students made as an affordable device.
community
E-readers face competition from tablets and smartphones, hence profitability looks uncertain in future Kindle should position
itself as an affordable e-reader offering decent hardware, other facilities include streaming video, web surfing and numerous
clould based services.
 Unit Cost and Revenues for the Amazon Kindle Fire Over 3
Years
Hardware Content E-Book Commerce Ad Revenue App
Store

Growth Rate 10% 10% 5% 20%

Year I -1$ $10*12 $10*12 $50*12 80%*($10*30mn

*12) +
20%*($30)

Year II $132 $132 $630 80%*($10*30mn

*12)

Year III $145.2 $145.2 $661.5 80%*($10*30mn

*12)

Margin 30% 20% 20% 100% 30%

 Business Model Canvas
● Hardware
● Hardware Development
Manufacturers ● Ecosystem Integration
● Publishers ● Forging partnerships
● Authors ● Content Rights
● E-book sellers Acquisition
● Magazine publishers ● Cloud Services
● Newspaper
Companies
● Players in the
marketplace
(commerce and apps)
● Amazon Ecosystem
● Cloud-based service
● Lab 126 (Hardware
Development Group)
● Personalized
● Cheap digital ● Automated and scalable ● Media Junkies
content library ● Customer acquisition via ● Children and
● Accessibility to device sales Mobile gamers
rich content ● Customer retention via ● Leisure readers
● Useful features content library, prime ● Working
● Access to Amazon and app store Professionals
ecosystem ● Students pursuing
● Multiple use-cases higher education
● Device Sale
● Device and service
feedback
● Content library
● Cloud storage
● App store
● Prime

● Hardware sold at cost (more or less) ● Hardware Sales

● Content licensing costs ● E-book, online content sales
● Subscription and membership charges
● Lower costs for digital conversion and maintenance of content
● Advertisement Revenue
● Self run cloud services and infrastructure investment ● Commerce Revenue
● Cost control via process efficiency, ecosystem efficiencies, technology ● Application Marketplace Revenue
and data network
 To what extent is the model adopted by
Kindle Fire appropriate?

● The model adopted by Kindle Fire at present have flaws regarding

the hardware systems they have.
● All the tablet users would be concerned about the screen
resolutions and the other hardware features provided along. So this
lag should be taken into account to take the model ahead.
● So, to penetrate the market, adding just added contents won't make
their product stand out.
● Content and the platform through which it is provided should be
modified.
● Their strategy of lower pricing is appropriate. Kindle is priced
three to four times lower the price of ipad
 Based on the analysis, what should Jeff Bezos do?

● Amazon has foreseen almost all the flaws in product strategy in the existing
tablets.
● They are trying to expand the ecosystem by introducing Kindle Fire with low
cost strategy.
● Amazon have good competition from Apple and B&N. So low cost strategy will
help them.
● In case of Kindle Fire, they should try to improve on the content they are
providing and the platform through which it is providing. Wider range of data
should be available at low cost.Wider content access for lower price. Since it is
having content as its key driver for revenue, they should shift their strategy in
this area. This low cost will be covered up once the customers start using Kindle
Fire.
● In case of Amazon Kindle, they should try to enhance education sector
penetration.This can be like special packages for specific institutions
● Razor- Razorblade model is actually appropriate. They should have continued
THANK YOU