Amazon SWOT Analysis - Strengths, Weaknesses, Opportunities, Threats

Question Two 

Table 1: SWOT Table for Amazon 

Strengths 

First, the Annual prime membership is $119 which includes free two day shipping, delivery benefits, streaming benefits and shopping benefits. Secondly, the website is customer and user friendly. Customers have access to customer service representatives through e-mail, instant chat and phone Customers can return purchases easily through postal drop off services and pre-made packing slips (Mohammad, 2018). Third, it has a large selection of products makes it easy for shoppers to get practically anything on the website. The large selection is also due part to 3rd party sellers. Lastly, Amazon has owns a diverse selection of subsidiaries and websites such as Whole Foods, Audible, IMDb, Zappos and more. 

Weaknesses 

Amazon is only an online retailer. Customers cannot physically go into stores and assess the quality of products and having an only online retailer can interfere with potential business expansions of Amazon (Farooq, 2019). Secondly, there is a growing counterfeit problem on Amazon. This can cause bad reviews on actual brands Amazon pages (Greene, 2019). Fourth, the quality of products is also questionable as there is large number of third party sellers from China and customers question the quality of the products. 

Opportunities 

First, Amazon could offer a type of payment plan to help customers pay in installments for products. The second opportunity is investing in airplanes. By investing in Amazon Air, Amazon will not have to rely on other delivery services to deliver products and goods which then can help its growth (Feiner, 2019). Third, it can expand to physical stores. These stores can be supermarket like or focus on clothing. Fourth, Amazon can implement new technology methods to limit poor quality products and counterfeit products. 

Threats 

Other retailers such as Walmart, offer greater discounts along with free two day shipping without a membership like Amazon prime (D’Onfro, 2014). Secondly, regulation is a threat to Amazon. Amazon has limited competition, and it is a cause in past big-name retailers shutting down (Lovely, 2019). Finally, poor working conditions is a constant complaint about Amazon. Workers have said they work on their feet for long periods of hours, limited breaks, and limited bathroom breaks and these workers are underpaid. 

Question Three 

Amazon should embark on effective technology to remain innovative in the market. To achieve this, the companies should remain loyal to their customers even if chances of switching to immediate competitors are high. 

Amazon should use technology to achieve the differential advantage. By this, a superb and/or superior customer service can be achieved. 

Amazon should lower their pricing to attract other new customers. This could be a perfect effort and opportunity to beat its competitors, who are innovators in this online market ( Lincoln & Andrew, 2018) . It is pre-empted that seeking to take its competitors to war is the best option because the aim is to gain market dominance. 

Question Four 

The greatest consideration in the development of Amazon’s strategic options was first the open systems model which emphasizes on the need for organizations to be flexible to adapt to changes from external influences. The second consideration was the rational goal model which emphasizes on the need for an organization to spell out its goals clearly. In a bid to achieve market control, Amazon should have its goals set right. The third consideration is the internal process model which would bring about smooth communication within the organization particularly regarding the goals and objectives and this would accelerate success. 

References 

D'Onfro, J. (2014, December 18). Amazon Is Facing An Unprecedented Wave Of New Threats. Retrieved from https://sg.finance.yahoo.com/news/amazon-facing-unprecedented-wave-threats-183121696.html?guccounter=1&guce_referrer=aHR0cHM6Ly93d3cuZ29vZ2xlLmNvbS8&guce_referrer_sig=AQAAAJhrIGjEuQDcpNg1QA4EzY8X8IuTp7ZsivbHhSgBPWPS2FmbsqCSXyVWdqGbuR_jovWPoOhfZYAWxvAwpmuhGwnjSuWc0ZRSQ_DcLJCud5wfyDj9ZDJgs_o_myNSLlXNBSOPq7ZBkg7UUvoTkTKfC_Dp01B6ll52pbgdo9B5EX5f 

Farooq, U. (2019, June 6). Retrieved from https://www.marketingtutor.net/amazon-competitors/ 

Feiner, L. (2019, May 19). Amazon is spending billions on internet satellites, self-driving cars and more as revenue growth slows. Retrieved from https://www.cnbc.com/2019/05/17/amazon-makes-several-start-up-investments-revenue-growth-slows.html 

Greene, J. (2019, November 14). How Amazon's quest for more, cheaper products has resulted in a flea market of fakes. Retrieved from https://www.washingtonpost.com/technology/2019/11/14/how-amazons-quest-more-cheaper-products-has-resulted-flea-market-fakes/?arc404=true 

Lincoln, I. V., & Andrew, C. E. (2018). Porter Analysis: A Business Strategy of Amazon. Com Through a Value Chain and Comparative Advantage Analysis of Amazon’s Trademarks and Intangibles.  Com Through a Value Chain and Comparative Advantage Analysis of Amazon’s Trademarks and Intangibles (November 27, 2018). Practical Guide to US Transfer Pricing, 

Lovely, S. (2019, August 20). Antitrust Regulation Is a Major Threat to Amazon. Retrieved from https://www.fool.com/investing/2019/08/19/antitrust-regulation-is-a-major-threat-to-amazon.asp 

Mohammed, S. (2019, October 23). How Did Amazon Build Its 'Sustainable Competitive Advantage'? -The Key Success Factors. Retrieved from https://medium.com/@shahmm/how-did-amazon-build-its-sustainable-competitive-advantage-88cfee7fe2c8 

Tompkins, J. (2005).  Organization theory and public management . Belmont, CA: Thomson Wadsworth.