E-Business Model Monte Sutton Strayed University Assignment #2 Submitted in Partial Fulfillment of the Requirements for the Course BUSSES: Contemporary Business Dry. Miller Fall 2011 Discussion 1. Discuss the pros and cons of Amazon’s growth and diversification of business and specialization, and make recommendations about what Amazon could have done differently. The internet has become a part of most everyone daily life for many years now. In addition E-Business has appeared for several years now.
E-Business refers to conducting business over the internet. E-Business accounts for more than one- quarter of the value of all manufacturing shipments, sales and revenues, totaling $1. 3 trillion (Boone & Kurt, 2011). In 1996 a famous retail company in E-Business was launched called Amazon. Com. Amazon. Com sells various products like electronics, books, music, DVD’s, housewives, PC’s and cars. Amazon. Com is the biggest retailer in E-Business, it has expanded its business in more than 220 countries. Amazon had first started out as a company had first started out as an online bookstore.
While selling books Amazon was making a decent profit, but Amazon leadership did not feel hat they were not making as much money as they had hoped to make for the first year. Also a lawsuit from Barnes and Noble prompted Amazon to come up with a way to better its corporation. In 1999 when the E-Business boom began Amazon called to Jump on ten Downward Ana emerge Itself Into ten world AT E-Business. Went Amazon began to emerge into the world of E-Business this was the best thing they could have done. By doing this they begin to make huge profits and turned into one of the world’s leaders in E-commerce.
Amazon was able to take over the E- Business because they began to offer to their customer’s better deals than the other E-Business corporations could offer. They were truly focused on customer satisfaction. The firm uses sophisticated inventory tools that help keep its costs down and allow it to wait for favorable supplier prices before placing orders. Amazon was able to restock when nobody else was restocking. As demands was falling off a cliff [because other retailers had placed holiday orders much earlier], they could get better rates (Boone & Kurt, 2011 up. 23). The owner Jeff Bozo understood that in order to remain competitive in this business they had to first focus on the needs of the customers. Understanding what customers want and need is was very beneficial for the success of the company. Also expanded its merchandise at a lower cost would also attract more customers to order from Amazon. Another benefit of Amazon was that they had partnership with numerous transportation companies and could provide fast and accurate service to their consumers.
Amazon has experienced many negatives ratings from some of their customers because of some of the defective merchandise they have received. Because Amazon has partnership with many consumers to sell their merchandise Amazon does not really know what a person may be receiving. Consumers only know that they ordered this merchandise from Amazon and if something is wrong Amazon should be responsible for the product. I fully understand their complaint. I fully understand the consumer’s complaint. I recently ordered a Colby MPH player from Amazon and when I got the MPH player it did not work.
I looked all over the internet to try and find a contact number for Amazon but could not. I called Colby and went through some trouble shooting techniques before it was determined that the part was defective. The Colby told me to return the merchandise back to Amazon and they would replace it. Although once I went on Amazon website to find out how to return the item it was fairly easy. I felt as though instead of me returning the item back to Amazon I should have returned the item to Colby and they could have sent me a replacement item.
Now I have to wait until Amazon gets the old MPH player and the they order me another one from Colby. I would recommend that Amazon find out a way to cut out the middle man so that consumers can get their replacement items in an expeditious manner. Discussion 2. Determine the impact if Amazon. Com had split up and became a family of brands (for example “Amazon” for books, “Super toys” for toys, etc. ), each with a public face but all run by the same parent company. Amazon may have lost some consumers had they would have branded themselves into a family of brands.
What makes Amazon so unique is that a person can go to their one website and find everything they are looking for. The website has made so many changes to make it easier for the consumer to go directly to their website categorize what they are looking for and will be able to see Just that product. Had Amazon would have Just distinguished itself into a certain brand it would have seemed like they may have been trying to promote a certain item and this would have created competition amongst Amazon with its own mercurialness equipment .
I Nils cool a nave Eden contusing to ten customer who truly likes ordering from Amazon. They would think that this is another E- Business that they are not familiar with doing business with. The ease of going to one website and understanding that everything at this website is all Amazon and the way that you use to order your merchandise you can still do it the same way. To many companies tend to think they are doing things to make it better for the consumer but in all actuality they are confusing the consumers. Discussion 3.
Determine if it would be possible for Barnes and Noble or Borders to extend their markets in the same way that Amazon. Com has. Explain your rationale. Yes I think it is very possible for Barnes and Noble or Borders to extend their markets in the same was Amazon. Com has. The reason I feel this way is because the average American consumer we are always looking for the next best marketable company on the internet. Variety is the spice of life. At first consumers would be hesitant to order something other than books from Barnes and Nobles or Borders.
But once the word get out that both these companies have become and establish E-Business like Amazon they should have no problem with becoming marketable in the E-commerce business. Not all consumers are happy with ordering merchandise from Amazon, so therefore it will take another company to get into the E-commerce business and have an established reputation and more will follow. In order for Barnes and Noble and Borders to become successful they need not to try and duplicate what Amazon is already doing in the E-Business.
They need to come up with other creative ways to market their products, and also try and offer better pricing and better shipping rates than Amazon has to offer. Like anything, at first business may be slow for both companies because this is a new venture for them. But once the companies understand how the E-Business works and what customers want and need I don’t for see any problems with them marketing other items other than books over the internet. Discussion 4 Determine what Amazon. Com would need to do to expand their distribution chain to include some brick and mortar outlets, and whether or not this would be a good idea.
In order for Amazon to get into the Brick and Mortar outlet Amazon now would have to go out and find more building throughout the world and then higher more employees to run the outlet facilities around the world. Now Amazon instead of competing in the E-commerce industry now they would also be competing in the store industry. By doing this would cost Amazon more money and could possible reduce the decline in sales over the internet. This would not be a good idea for Amazon for many reasons. Operation cost to maintain a building and a full time staff aka up a large part of the overhead cost.
Most retail stores commission are a big part of a sales person salary so therefore they may not have the best interest in the customer. Eat R II stores cannot compete Walt ten online prices Ana most times ten internet provides more information than the sales representative could. Most consumers now days go to a retail store and price and item then go home on the internet and get a better deal. Amazon is doing Just fine by remaining the top E- Business on the internet, References Boone, L. , Kurt, L. , (2011). Contemporary Business. Sons Inc. Hoboken, NJ: John Wiley and