Marketing Marketing Strategy of Amazon CHAPTER I Amazon.com Overview
Amazon.com was one of the first major companies to sell goods over the Internet and has become a worldwide established establ ished name. Amazon.com is an American e-commerce company that is based in Washington. It was founded by Jeff Bezos in !!" and began as an online boo#store but due to its success$ Amazon has diversified into other product lines and services such as groceries$ groceries$ electronics and %erchant &rogram 'see Appendi( Appendi( for detailed portfolio). Amazon.com*s stoc# price has fluctuated in recent years from +, in !!! to + in ,, '/auden and 0raver$ ,,,). Amazon.com has developed separate websites for 1ana 1anada$ da$ 23$ 23$ 4erm 4ermany any$$ 5ranc 5rance$ e$ 1hina 1hina and Japan Japan.. Amazon mazon.co .com m visio vision n is to becom becomee 'Amazon.com$ ,,6)7
89arth*s biggest selection and to be 9arth*s most customer centric company Analysis External Analysis
0he e(ternal environment is referred to as the macro-environment macro-environment.. 0his includes the broad environmental factors which will affect organisations at various levels. It is important to consider the potential impact of the e(ternal factors on the individual organisations 'Johnson et al$ ,,:$ &:).
PESTEL Analysis
&9;09/ analysis is used to identify how future trends in the political$ economical$ social$ social$ technol technologic ogical$ al$ environm environmenta entall and legal legal environm environments ents might might influenc influencee an organisation. Industry and cometitor analysis
0he analysis on industry and competitor environment is important for organisations$ because it is useful for managers to understand the competitive forces acting on and between the organisations in the same industry 'Johnson et al.$ ,,:$ p66).
Porters !ive !orces in t"e E#Retailin$ Industry
&orter*s 5ive 5orces analysis is used to assess the attractiveness of different industries$ and therefore$ it can help in illustrating the sources of competition in a particular industry Page 1
Marketing Marketing Strategy of Amazon Cometitor Analysis
4iven 4iven the the scope scope of Am Amazo azon.c n.com om*s *s produc productt range range$$ there there are are hun hundre dreds ds of websi website tess that that Amazon.com competes with.
E#Retailin$% Strate$ic &rou Analysis
&lo'al
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Marketing Marketing Strategy of Amazon Cometitor Analysis
4iven 4iven the the scope scope of Am Amazo azon.c n.com om*s *s produc productt range range$$ there there are are hun hundre dreds ds of websi website tess that that Amazon.com competes with.
E#Retailin$% Strate$ic &rou Analysis
&lo'al
Page 2
Marketing Marketing Strategy of Amazon &lo'al Internet Trends
Internet (sa$e
;how that the five countries with the highest internet usage are 2;A$ 1hina$ Japan$ 4ermany and India. Amazon.com have a presence in all of these countries e(cept for India. 0his indicates a potential opportunity for Amazon.com.
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Marketing Marketing Strategy of Amazon Internet retail
!i$ure )% &lo'al internet retail sector value* +,,+#+,,)
;ource7 =atamonitor >Accessed 6.,.,?@ 0he graph above shows that the global Internet retail sector grew by ".? in ,,: to reach a value of +6"6.: billion.
Rest o- t"e world ./0
(nited States ++.10
Asia Paci-ic +,.10
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Marketing Strategy of Amazon &E 2atrix A 49 %atri( has been used to identify the attractiveness and competitive position of the mar#ets that Amazon.com operates in$ using the indictors as identified by Johnson et al ',,:$ p,). As previously discussed$ all mar#ets are facing similar conditions$ however 1hina and the 2;A appear the most attractive as they are the largest and most dynamic mar#ets. 1hina and 1anada have the wea#est positions within their mar#ets$ suggesting that investment is reCuired for improvement. 0he other mar#ets have strong positions within the industry.
Internal Analysis
Internal analysis provides a useful method to establish the relationship between Amazon.com*s resources and capabilities 'internal strengths)$ and how this is used to create value for the customer. 0he internal analysis can also help to identify the limitations within Amazon.com*s operations 'Johnson et al$ ,,:).
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Marketing Strategy of Amazon T"e 3alue C"ain
0he value chain analysis underta#en e(amines the operational effectiveness of activities that enable Amazon.com to perform better than its competitorsD i.e. the distinctive value chain activities that are difficult to imitate. 2sing the framewor# proposed by Amit and Eott ',,) this analysis focuses on Fvalue creation* and Ftransaction cost economies*D where Amazon.com configures its value chain activities to create uniCue value for customers$ reduce its costs of carrying out these activities and reduce the cost of its customers* transactions. 0he figure below indicates e(amples of how Amazon.com has created value and reduced costs in its value chain activities.
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Marketing Strategy of Amazon S4OT Analysis =rawing from the internal and e(ternal Analysis$ we can summarise Amazon.com*s strengths$ wea#nesses$ opportunities and threats in the following ;WG0 Analysis. 5or a more detailed ;WG0 see Appendi( ".
Stren$t"s 4lobal brand 5ocus on research and development ;trategic location 1ustomer-centric vision =iverse products Applied advanced technology Amazon.com*s %erchant &rogram ;#illed wor#force ;trong logistics
Oortunities 4rowth in movie downloads ;ocial networ#ing 4rowth of online shopping in 1hina Beijing Glympics ,,? 9(pansion through acCuisitions 4rowing e-commerce sales 4rowth in digital media Increased consumer spending in India
4ea5nesses Ho physical presence /ow profit margins /ow cash flows Wea# performance in 1hina
T"reats =ependent on vendors ;trong competition &atent infringement
Strate$ic Otions Strate$ic Otion % 2ar5et 6eveloment - AcCuire a growing$ profitable e-retailing
company in India to ta#e advantage of the growing mar#et. Suita'ility
0he &9;09/ analysis reveals consumer spending is rising in India '0imes Gnline$
Page 7
Marketing Strategy of Amazon ,,6)
5rom the analysis of global internet trends India ran#ed as the fifth highest in Internet usage 'Internet World ;tats$ ,,6)
4overnment policy has targeted three million broadband users$ therefore increasing consumers* li#eliness to shop online '9uromonitor$ ,,6)
5rom the strategic group*s analysis competitors such as Wal-%art and 0esco aim to increase their geographic scope and thus may enter the Indian mar#et 'esearch and %ar#ets$ ,,). 0herefore it is vital for Amazon.com to gain from first mover advantage to establish its presence
!easi'ility
0he ;WG0 'Appendi( ") reveals that one of the strengths of Amazon.com is the e(perience and #nowledge in successful acCuisition and integration such as boo#surge.com and dpreview.com and Brilliance Audio
Amazon.com need to borrow to finance the acCuisition$ which may be problematic as they are already highly geared at :?
By acCuiring an Indian e-commerce company they will also be acCuiring the local #nowledge
Acceta'ility
Internet users are forecasted to increase " from ,,: to ,$ presenting a growing mar#et and$ therefore reducing ris# and increasing the potential of high returns '9uromonitor$ ,,6).
;hareholders are more favourable towards long- term investments$ such as this strategy therefore there is a higher chance of acceptability '19G /etter to ;hareholders$ Amazon.com ,,: Annual eport$ see Appendi( )
By acCuiring a company there is the ris# of cultural conflict
Strate$ic Otion +% Service 6eveloment # &roviding a Fgreener* delivery option.
1onsumers will be given the choice of selecting the standard delivery option or the Fgreener* delivery option. 0he Fgreen* option means that the items will be delivered in a biodegradable plastic container. 0he consumer will be encouraged to return the bo( after Page 8
Marketing Strategy of Amazon use in return for a Fgreen point*. After collecting a certain amount of points$ the consumer will be sent an e-voucher to be spent at Amazon.com. Bo(es will be re-used by Amazon.com in future deliveries$ which in the long-term will reduce cost of pac#aging and ensure less wastage.
Suita'ility
0his strategy will address the issue of increased environmental awareness$ as highlighted in the &9;0/9 analysis.
0his is an important issue for the e-retailing industry as all products need to be sent to customers.
0his
strategy builds on Amazon.com*s past efforts
to maintain
environmental awareness as highlighted in the esource Based iew analysis.
!easi'ility
Biodegradable plastic containers$ whilst currently available$ will reCuire e(tensive research by Amazon.com to ensure that all products can be transferred safely to consumers. Amazon.com has an active research and development department which can be utilised for this purpose. Amazon.com has highly e(perienced wor#ers 'as shown in the alue 1hain) who should be able to create and manage the new Fgreen points* system and e-vouchers.
Acceta'ility
0here is a ris# that the consumers will not return the bo(es for re-use. 0he cost-benefit mentioned above will therefore not be obtained. As society becomes more socially aware$ consumers will want to ma#e a difference through their pac#aging choice. 4overnments may ta#e an interest in the greener initiative and may support Amazon.com in some capacity. alue creation and the possibility of reduced costs should lead to increased returns for shareholders.
Strate$ic Otion 7% Product 6eveloment 0his option recommends the addition of
prescriptive contact lenses to Amazon.com*s product range.
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Marketing Strategy of Amazon Suita'ility
1ompetitor analysis has identified that Wal-%art.com and 0esco.com offer this service$ so by choosing this strategy Amazon.com will be able to be competitive.
0he 2; mar#et for eyeglasses and contact lenses has grown by .? since ,, to reach a value of 2;+!. billion in ,," 'see 5igure ")
An estimated :, of the 2; population reCuires vision correction. 0his number is e(pected to grow as more consumers spend more time wor#ing with computers '9uromonitor$ ,,?).
0he graph below shows the increase in contact lenses in the geographic regions where Amazon.com has a presence.
!easi'ility
Amazon.com*s value activities 'as e(plained in alue 1hain Analysis) include successful cooperation and joint ventures with other companies. In the case of contact lenses a partnership with healthcare professionals is important.
Acceta'ility
;ales of optometric products will increase customer choice in healthcare goods. 0he initial investment for this option will be high$ however$ long-term profitability reduces the overall financial ris# associated.
Strate$ic Otion 8% 2ar5et Penetration in C"ina
Amazon.com entered the 1hinese e-commerce mar#et in ,," by ta#ing over Joyo.com '1hina I0 K 0elecom eport$ ,,6).
Otion
Imlementation
2ar5et &oal
9(tensive mar#eting through various
Raisin$ awareness and
medium e.g. 0$ outdoor$ &ress and
'rand 'uildin$
adio
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Marketing Strategy of Amazon Otion+
Increase product range and suitability
Increasin$ mar5et
through introducing the %erchant
s"are and sales
&rogramme.
Suita'ility •
0he &9;0/9 analysis reveals a high economic growth in 1hina and high consumer spending
•
4lobal internet trends shows that 1hina has the second highest internet usage in the world
•
In the 49 matri($ 1hina is the most attractive mar#et for Amazon.com
!easi'ility
Amazon.com has the resources in s#ills$ e(perience and #nowledge to underta#e global operations successfully as demonstrated in the 23$ 4erman and Japanese mar#ets %ar#et penetration into 1hina will be less capital intensive than entering a new mar#et Amazon.com has successfully implemented the %erchant &rogram in the 2.;.
Acceta'ility
Amazon.com*s investments in 1hina must be fully harnessed to e(ploit the mar#et potentials thus reduces financial ris#s
0he %erchant &rogram will create value for the 1hinese
consumers since it increases the chances of local merchants to sell specialised or local products
&enetrating the 1hinese mar#et will have long term benefits which increases
shareholder value Strate$ic Otion /% 2ar5et 6eveloment L ;etting up a sales facility via the social
networ#ing website$ 5aceboo#. Amazon.com could develop a presence on 5aceboo# to boost digital media sales. 0his would involve teaming up with 5aceboo# to create an Amazon Application. =igital media such as films$ mps and e-boo#s would be sold via the Amazon Application and purchased goods would be accessed through 5aceboo# profiles. 0he Amazon Application will allow users to create wish-lists that can be sent to friends and family. 5aceboo# is a global social networ#ing site which is currently undergoing a Page 11
Marketing Strategy of Amazon huge period growth with more than ,$,,, new users sign up daily '0I%9 Gnline$ ,,6)D with "" of 2; consumers using social networ#ing at least once a month in ,,? '&ublishers Wee#ly$ ,,? p:).
Suita'ility
0his strategy will ta#e advantage of the continued growth in social networ#ing websites 'as shown in the &9;09/ Analysis). 4ain access to large customer base '5aceboo# has over , million active users) that Amazon.com can target 0his strategy will also help to increase awareness and boost sales of digital media.
!easi'ility
Amazon.com already has the technology to sell digital media online. 5aceboo# may not allow Amazon.com to have a presence on the website.
Acceta'ility
0his strategy should boost sales of digital media which will increase profits$ therefore pleasing the shareholders.
2sers of 5aceboo# will be able to purchase digital media
whilst they are on the social networ#ing website. 0his provides a Cuic# and easy service for the consumer.
Strate$ic Otion )% 2ar5et 6eveloment into Scandinavia
;candinavia is made up of four countries$ namely$ =enmar#$ 5inland$ Horway and ;weden with a combined population of million '9uromonitor$ ,,?).
Suita'ility
Amazon.com demonstrates a well functioning routine in outbound$ operations and inbound logistics as highlighted in the alue 1hain Analysis earlier in this report.
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Marketing Strategy of Amazon
0his option will attempt to address the lac# of geographical scope in comparison to its competitors
9(ploit the internet and technological infrastructures and s#ills in ;candinavia '1openhagen 1apacity$ ,,?)
4lobal internet trends '5igure :) show that 9urope has the largest internet retail spend and a presence in ;candinavia will provide a significant brand presence in Horthern 9urope
!easi'ility
0he four mar#ets can be served by a single distribution centre in the region of ;#Mne as shown in 5igure : 0he four airports$ seven harbours and logistic e(pertise in ;#ane can be easily e(ploited and integrated with the value chain activities of Amazon.com %odern I10 and I0 infrastructures to support services
Strate$ic C"oice9:usti-ication
Gur evaluative criteria have identified three viable strategic optionsD %ar#et =evelopment in 1hina$ &roduct =evelopment 'contact lenses)$ and %ar#et =evelopment through 5aceboo#. 0his report recommends that Amazon.com should focus on improving its performance in 1hina through mar#et penetration. 0his can be justified by 1hina being one of the largest consumer mar#ets in the world and has the potential to grow even larger. 0oday 66 of urban 1hinese households live on less than $,,, %B a year. It is estimated that by ,$ this percentage will drop to , '5arrell$ 4ersch and ;tevenson$ ,,:). 0his indicates that it would be wise to improve Amazon.com*s performance in
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Marketing Strategy of Amazon 1hina now so that it can ta#e advantage of this growth in years to come.
With regards to competition in 1hina$ the current mar#et leader$ =angdang.com*s year strategy of selling at the lowest prices 'even if it resulted in a loss) was due to end in ,,6. 'Infomaticsonline$ ,,6). 0herefore$ it is recommended that Amazon.com act now in order to ta#e advantage of this change of strategy.
Amazon.com have already spent millions in gaining access to the 1hinese mar#et and so we recommend that Amazon.com aim to improve performance here before investing heavily in other foreign mar#ets '1hina Business 5eature$ ,,?). 0his justifies why we do not recommend going to India or ;candinavia at this time.
According to a recent letter to shareholders 'see Appendi( )$ Amazon.com only invest in areas which promise a significant return and 8impact on the overall companyN. With this in mind$ it is clear that 1hina has the potential to give Amazon.com the largest return and have a greater impact on the overall business compared to developing contact lens sales and selling through 5aceboo#.
5rom the &9;09/ analysis constructed for 1hina ';ee Appendi( :)$ Amazon.com can highlight the environmental factors affecting the company performance in 1hina and identify the most important at the present time and the long term. 0he main issues affecting Amazon.com*s performance in 1hina have been presented below7
2ain ro'lems identi-ied%
. =angdang.com*s strategy in overta#ing joyoamazon.com as the mar#et leader was heavily influenced by price war ';inocast$ ,,"). . Amazon.com lac#s cultural awareness of the 1hinese population '=ean$ 0he Wall ;treet Journal$ ,,:).
. 1hina*s internet regulators have made it difficult for foreigners to participate fully$ giving local 1hinese e-retailers an advantage from the offset '=ean$ 0he Page 14
Marketing Strategy of Amazon Wall ;treet Journal$ ,,:)
Strate$ic O';ectives
egain the status as the mar#et leader by increasing mar#et share from its current position of : to " within the ne(t years. Improve #nowledge and cultural awareness of the 1hinese population$ implementing services which best suits the 1hinese mar#et. 0o secure at least ten merchants for the %erchant &rogram within the first year
!inal Remar5s
. 0he global-local dilemma theory relates to the e(tent to which products and services may be standardised across national boundaries or need to be to be adapted to meet the reCuirements of specific national mar#ets 'Johnson et al$ ,,:). 0his is a #ey area which needs to be resolved by Amazon.com before the identified potential advantages of operating in 1hina can be fully realisedD Amazon.com*s strategy must be locally responsive . Amazon.com lac#s cultural awareness of the 1hinese population '=ean$ 0he Wall ;treet Journal$ ,,:). . 1hina*s internet regulators have made it difficult for foreigners to participate fully$ giving local 1hinese e-retailers an advantage from the offset '=ean$ 0he Wall ;treet Journal$ ,,:) Strate$ic O';ectives
O
egain the status as the mar#et leader by increasing mar#et share from its current position of : to " within the ne(t years.
O
Improve #nowledge and cultural awareness of the 1hinese population$ implementing services which best suits the 1hinese mar#et.
O
0o secure at least ten merchants for the %erchant &rogram within the first year !inal Remar5s
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Marketing Strategy of Amazon 0he global-local dilemma theory relates to the e(tent to which products and services may be standardised across national boundaries or need to be to be adapted to meet the reCuirements of specific national mar#ets 'Johnson et al$ ,,:). 0his is a #ey area which needs to be resolved by Amazon.com before the identified potential advantages of operating in 1hina can be fully realisedD Amazon.com*s strategy must be locally responsiv e. 7 Con-i$uration
1onfiguration is a #ey factor in order to ensure the chosen strategies are implemented smoothly and maintained 'Johnson et al.$ ,,:). 9ach of the elements of configuration as illustrated in the diagram below$ are discussed in the following sections.
Structure
As firms go international$ =e Wit and %eyer ',,) argue that their strategies must address two dimensions of the international business conte(t. ;hould they configure their structures$ resources and processes in order7 80o adapt to the international diversity encounteredN or
80o overcome the constraints imposed by distinct national systems$
structures or behaviours 1onsidering the current challenges faced by Amazon.com in 1hina$ such as tough mar#et competition and price war with =angdang.com ';ino1ast 1hina I0 Watch$ ,,")$ and unsuited ban#ing and payment systems '1hina Business Hews Gn-/ine$ ,,")$ it is important the mar#et penetration strategy e(ploits internal e(pertise in order to adapt to local challenges. ;tructuring of Amazon.com plays an important role in the internal co-ordination of functions$ responsibilities and lines of reporting so as to achieve the competitive edge in the 1hinese e-retailing mar#et.
By analysing the Fdimensions* of globalisation as argued by =e Wit and %eyer ',,)$ it can be argued that the notion of Fworldwide similarity* and Fworldwide integration* 'p") do not provide the right framewor# for mar#et penetration in 1hina by Amazon.com. 0hese notions purport globalisation as the reduction in variance 'i.e. the products consumed by 1hinese consumers are similar to Western consumers) and as the integration of mar#ets 'i.e. tastes and subtle differences of local mar#ets are overshadowed by global interconnectedness). 0he argument here is that Amazon.com*s structure should reflect the notion that globalisation is the geographical e(pansion into local mar#ets with special needs to be met. 0hus the recent difficulties faced by Amazon.com can be better Page 16
Marketing Strategy of Amazon encountered by adapting structures to meet local needs of 1hina. Bartlett and 4hoshal '!?!) proposed the integrated networ# 'or 0ransnational) model to structure organisations where country subsidiaries have close relationships with international headCuarters but also have strong relationships with other subsidiaries. 0he advantage of Amazon.com adopting such a model is to7
O
Balance the need for global standards and devolved decision ma#ing
O
Balance local independencePresponsiveness with global co-ordination
O
9nable large flow of information$ people$ resources and best practices
O
9nable shared strategic decision ma#ing between international headCuarters and local subsidiary O
0he diagram above is adapted from Bartlett and 4hoshal '!!?) and illustrates the " structural models that emerge between local responsiveness and global co-ordination relationships.
O O
In the diagram below$ the bottom row refers to the level of local %anaging =irectors who have e(pertise of the 1hinese mar#et and consumer tastes. 0he table shows what #ind of roles$ responsibilities and reporting structures will have to support such a model in a 1hinese mar#et penetration strategy.
Sta5e"older 2ana$ement
It is important to assess the e(pectations of different sta#eholders and the e(tent to which they are li#ely to see# influence over Amazon.com*s strategies. 0o do this we have used sta#eholder mapping which will underline how interested each sta#eholder group is to emphasize its e(pectations on the specific strategy and also whether the sta#eholder has the power to do so 'Johnson et al$ ,,:). 0he different sta#eholders have been summarised in the table below adapted from Johnson et al ',,:)7 S"are"olders
It is important to have the shareholders* full support in mar#et penetration in 1hina. 0he 1hinese mar#et has the potential to yield long term investments.
Marketing Strategy of Amazon shareholders well informed of the possible ris#s and the possible length of time before any e(pectations of financial returns is very important. ;uch an action may reduce any future conflicts that may arise$ such as cash flow$ pay levels and short term losses.
C"inese &overnment
Amazon.com must comply to regulations and restrictions imposed by the 1hinese 4overnment '=ean$ 0he Wall ;treet Journal$ ,,:) such as promoting local e-retailers.
C"inese retailers in t"e 2erc"ant Pro$ram
3eeping the 1hinese retailers that participate in the %erchant &rogram satisfied is an important part of ma#ing the penetration in 1hina a success. When introducing the %erchant &rogram$ it is important that such activities with local retailers should meet the Cuality standards of Amazon.com and ma#e sure the brand reputation of Amazon.com is not tarnished.
!inancial Institutions
Amazon.com is currently highly geared as shown through the financial analysis. In order to implement strategies to penetrate into 1hina$ substantial investment will be reCuired. If this finance is not available internally$ then e(ternal sources may have to be established$ therefore this gives financial institutions power to refuse finances or to impose higher interest rates.
Customers
1ustomers must benefit from the %erchant &rogram through an integrated shopping e(perience$ and the mar#eting must effectively reach these 1hinese customers. 1ustomers should be informed of all new plans in order to increase acceptance. It is important that Amazon.com attempt to increase their interest through various primary mar#et researches as this will give Amazon.com an indication of what the customer*s e(pectations are.
Emloyees
0he strategy to penetrate in 1hina will affect employees as wor# may be increased or decreased through the %erchant &rogramme. It is important that all employees are #ept well informed of any new businesses$ products and restructuring of the company. 0hey will
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Marketing Strategy of Amazon decrease any resistance to change that may occur. It is important to have the support of the employees and if they feel neglected in the whole process then they may feel li#e their input is not valid. If employees are well informed they may also be more accepting in receiving lower bonuses due to the investment in the new strategy.
Local community
Although the local community may appear to have little power at the moment$ this could change if negativity and disagreement to strategies increase substantially creating a stronger local force. Amazon.com should also encourage the local traders involved in the %erchant &rogramme #eep the local community informed of developments.
6istri'utions
As the strategies do not involve any major changes to the distribution of products$ this department can be given minimum effort. 0he 1hinese &ostal ;ervice and other private delivery services are #ey sta#eholders in this regard. ;ince both businesses complement each other$ little effort is needed.
&lanning and control will be derived by a top down management approach. 9ach strategic objective as identified in section ". will be measured as follows.
O O';ectives egain the status as the mar#et leader by increasing
2easurement Industry analysis
mar#et share from its current position of : to " within the ne(t years. Improve #nowledge and cultural awareness of the
%ar#et esearch Brand position
1hinese population$ implementing services which best suits the 1hinese mar#et. 0o secure at least ten merchants for the %erchant &rogram within the first year
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eview %erchant &rogram
Marketing Strategy of Amazon Criti
As identified in section .$ we have used the =esign ;chool model of formulation to recommend mar#et penetration in 1hina. 0he =esign ;chool model approach is limiting in the sense that it ta#es too general an approach to strategy formation '%intzberg$ !!,$ p?). 0his has benefited us as it has allowed us to formulate a strong and justified strategy within the confines of the report.
!inancial
Amazon.com currently has a :? gearing level. 0his may limit the amount they can spend on the mar#eting strategy and the number of merchant traders on the %erchant &rogram.
Peole
0he recommended strategy may reCuire Amazon.com to increase its wor#force in 1hina and re-align their < strategy to accommodate this increase. 1onflict may arise when integrating the two cultures and structure.
CHAPTER II Literature Review •
Indi$o =>>1?$ in his study Qetailing the Internet K9mploymentN$ says that 0hree
models of retailing are emerging in this dynamic mar#etplace. 0here are the e(clusively Rbric#s-and-mortarR stores on the one side and the e(clusively Web-based retailers on the other. In the middle are a growing number of hybrid companies that do a combination of both. 0he 4ap$ one of the new hybrid versions$ manages to blend the online and offline distribution channels to ma#e the most of the advantages offered by each. 0hus customers can buy clothes online and if they arenRt happy with the purchase$ can ta#e them to their nearest &hysical store for e(change. 0he store is even installing Web lounges in some of their flagship stores for customers to browse at leisure and place orders. ;ome traditional retailers opt to acCuire stores with e-commerce e(pertise$ rather than starting from scratch to build their own Web store. %ergers and acCuisitions are part of the dynamism of the retail mar#etplace at the moment. Gf course$ downsizing and layoffs are a conseCuence of this process as well. Page 20
Marketing Strategy of Amazon %ost of the big manufacturers$ including Hi#e$ have no wish to alienate the retailers$ and have sought to appease them by promising to refrain from selling at discounted prices 'they also wish to maintain the integrity of the particular brand name in Cuestion so wonRt sell at cheaper prices).
•
@la5e =>>?$ e(amined the relationship between people and technology needed to
gain access to the internet mainly through personal computers. 0he paper also discussed the public opportunities for places such as access libraries. ;tated that number of people over 6 years of age was projected to be double by middle of ne(t century. While number of people of age !, years and over would be tripled. 0his ma#es the older generation a very important consumer in the near future. It also showed some of the problems older people would face while using the and also suggested some remedial net measures.
•
Coulson =>>?$ in the article QImpact of Internet on etailingN$ says that e-commerce
serves as springboard for fundamentally changing the way companies interact with customers. 1ustomersR satisfaction in e-retailing rests on four #ey criteria$ viz security$ simplicity$ the Cuality if relationship consumer and internet retailer and follow other. 0he study revealed that among those having websites$ ?" use it$ for advertising and only ? use it for selling.
•
Cy'er 6ialo$ue study* in >> some 2; + billion offline orders were influenced
by the Internet and this influence on consumer in-store spending was eCuivalent to seven times the value of purchases paid for online. ;o$ the good news for retailers with virtual stores$ and those contemplating the step$ is that consumer spending online is e(pected to increase by ?, yearly between now and ,,.
•
!orrester Researc" =>>? consumers and businesses will funnel total of +? billion
through e-commerce sites this year. And in an Gctober !!: report$ they predicted that by year ,,,$ more than +": billion will be spent online--and the organization.
•
I6E Canada =>>? $ the bad news for the 1anadian retail industry is that more than
:, of online dollars are being spent outside the country$ with the 2.;. being the Page 21
Marketing Strategy of Amazon primary beneficiary. Gne of the main reasons for this is that only a Cuarter of top retailers in 1anada are telling online$ compared to , of 2.; retailers$ leaving a gaping void in the mar#et. When 1anadian consumers cannot find the product or service they want on a 1anadian web site$ they turn to the better selection offered south of the border$ despite the unfavorable currency e(change rate and e(tra shipping time involved. It is interesting to note that Amazon. 1om is already the third most popular boo#seller in 1anada$ a testament to the growing popularity of online shopping.
•
InternationalB 6ata cororation* =>>? $ 0he Internet K
9mployment$ shows
online shopping growing at e(ponential rates in America with sales in the last si( months of !!? increasing by some ,,. In the 2.;. consumers purchased 2;+. " billion worth goods on the Internet in !!?$ as compared to 2;+". billion the year before. In 1anada$ e-shopping appears to be catching up$ with half a million 1anadian households shopping online in !!?. $ . ;ales reached + :!, million$ up from +6, million in !!6 a: increase. &rojections of future Internet commerce vary according to the source$ with the I=1 1anada estimating sales of +.? billion by ,,$ some ".: of total retail spending in 1anada. Grganization for 9conomic 1ooperation and =evelopment 'G91=)? '!!?) predicts that$ within the ne(t five years$ as much as of retail sales in the world*s industrialized countries will be conducted over the Internet. According to them online presence offers some less obvious opportunities for growing business. 5or e(ample$ research indicates than the Internet is powerful driver of in-store sales$ as many customers browse online to access product information before committing themselves.
•
Pivec =>>? concluded in his study that the emergence of internet brings changes into
social$ cultural and moral e(perience of people. 0his applies especially to teenagers who are attracted to internet much more intensively than any other section of population. 1yber cafes are fast becoming the favored meeting places and net surfing the favorite past time. 0he study also brought out the internet use pattern among the primary and secondary school students. It also indicates various purposes for which the younger generation is using the internet.
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Marketing Strategy of Amazon •
6utta =>>>? $ In the India 5%14 business margins are as low as ,.
retailing in such areas might not catch on.Q According to A /iterature ;urvey about current issues in BB commerce$ 0he more efficient sales channel enables that the customer can configure his own products$ for e(ample &17 s 'Brown et al. !!!) . 0his leads to many benefits. ;elling is cheaper$ because the need of sales personnel decreases and the remaining persons can concentrate on such tas#s that can*t be performed online. 0he customer generates orders and fewer mista#es ta#e place. 0herefore customization need to ta#e place as close to the customer as possible. Gne solution is to do the customizing in the warehouse just before shipping. In &1 industry the customizing of$ say$ a new employeeRs &1 may ta#e place at the customer*s office building$ where there is a special configuration room. 0he final user gets a readily configured &1 with user data on his des#$ and the delivery time is counted in hours.
•
ai ristensen and Hans :orn :u"I =>>>? $
in the article entitled$
F;upermar#et 1ustomer ;atisfaction- the Impact of 0ype and Gwnership* analyzed the effect of the type and the ownership of the supermar#et on customer satisfaction. 1oncerning the type distinguish had been made between hypermar#ets$ standard mar#ets and discount mar#ets with limited assortment. egarding ownership distinguish had been made between private and cooperative ownership. 0he analysis was based upon app. ,, interviews conducted in %ayS June !!!. 0he results pointed out that the type of the supermar#et had a significant effect on all e(ogenous elements of the 91;I model 'image$ product and service)$ while the effect of ownership was limited to image. It was found that product Cuality was lower in discount supermar#etsD on the other hand service was better in the standard supermar#et. In this study$ the cooperative obtained a much lower score on image than the private owned company in the hypermar#et and to some degree in the discount mar#et. As conseCuence of these differences in image a significant differences was found in customer satisfaction and loyalty in private stores and stores owned by a cooperative. It was found that the private owned company achieved higher success with the slogans stressing the store name and value for money in satisfying its customers.
•
6utta* SA Consultants =+,,,? while answering to the Cuestion. Is shopping on the Page 23
Marketing Strategy of Amazon net really catching on in IndiaT
•
Study conducted 'y Indian 2ar5et Researc" @ureau =+,,,? studied awareness
levels and. Acceptance of internet especially in commercial transactions over the net among$ the average Indian households. 0he study showed that small portion of &ersonal computers owners ':) and non personal computer owners ') are aware of e-commerce. &erception about the net is rich with it being identified as source of information$ communication$ learning$ and entertainment. elatively few amongst both the segments feel it to be a source of purchasing products and services. 0he study further revealed that a high proportion of both &1 owner ':) and non-&1 owner '6) said they would not li#e to buy over the net. 0he main reasons cited were no surety of Cuality and delivery. %ost of the respondents were ignorant of the methods of buying and selling in a digital environment.
•
:o"n @.Clar5 and Ho;on$ Hwan$ =+,,,? in the article entitled$ FInternational
comparative Analysis of 1ustomer ;atisfaction with =iscount ;tores* stressed on the importance of international comparative study on customer satisfaction for the multinational firms which entered or intend to enter in global retail mar#et as well as domestic firms which are already doing business in the mar#et$ to assess performance and mapping retail strategy. 0hey conducted a study to compare customer satisfaction between "," American discount stores and "" 3orean discount stores$ with the variables- helpfulness of sales person$ friendliness$ number of salespeople$ politeness$ Page 24
Marketing Strategy of Amazon store layout$ ease in finding things$ cleanliness$ assortment of department$ Cuality level$ merchandise selection$ fashionableness$ willing to e(change$ fairness of adjustment$ credit and charge account$ value for money$ price level$ special sales$ advertising$ location$ other store customers. According to the results of two multiple regression analysis$ the determinants variable to predict total customer satisfaction were almost same in both countries. 0he main motivation to visit discount store channel laid on the low price and convenience of location as the meaning of discount stores implied. ;ervice factor was relatively less important than merchandise factor. 1ustomers were mainly affected by merchandise value and location and advertisement factor. It was suggested that a greater insight into these factors would help retailers in developing appropriate mar#eting strategy.
•
Accordin$ to consultants SA* =+,,,? $ easier and faster shopping are the reasons for
shopping on the Het. In answering to the Cuestion how$ he further adds$ when you go to a bric#-and-mortar who could offer you ,$ ,,, items in his store. 1hances are there that he might be , out of stoc#. Gn the other hand$ the internet offers millions of products with no chance of an out of stoc# situation. And comfortably obtained information is another advantage that shopping on the net offers. Gn the internet$ production information is just a few clic#s away$ all accessed in the comfort of home. In other words we can say that$ shopping on the internet for$ say minutes could save a two hour trip to the mall. 1onsumers prefer to save this time so that they can devote more time for their professional and domestic priorities •
S"arma =+,,,? presents the estimates and forecasts of internetPintranet mar#et in
India in the light of changing regulatory environment. Internet usage by Indian users is also discussed. 0he study revealed that average Indian user shows a heavy reliance on the search engines$ particularly Uahoo. 1om '?!). 0he study also showed that Indian consumers were reluctant to buy over the net. 0he main fear being the misuse of the credit card and no surety of the Cuality of the product. 0here was seen a mar#ed ignorance about modes of payment in a digital environment.
•
3ira; Sayan =+,,,? $ &ains and &leasures of e-retailing$ says etailing is coming of
age in India. We have not seen large retailers in India until now. 9-tailing offers tremendous advantages and transfers these advantages to the consumer.
Marketing Strategy of Amazon financial services and travel services were to be included$ the e-tail mar#et would be a huge one. arious forecasts by research agencies estimate that the e-tail mar#et is +?, million large in ;outh and ;outh 9ast Asia. As far as IH=IA is concerned$ the etail mar#et should be anywhere near +, million. 347 0he greatest growth in e-tailing will come from class B and class 1 Indian towns. %y gut feeling is that , per cent of the Indian population would buy at least once on the Het by ,,R. 0he internet is going to spread li#e wildfire in our rural and semi-urban areas. Gne estimate is that there would be as much as four million Internet connections by ,,. 37 0he e-tail mar#et should be anywhere close to s 6 to s ,, crore.
3ait"eeswaranvice president 'mar#eting) of the Bangalore-based 5abmart that the
growth potential for both retailing and e-tailing is tremendous in India.
Page 26
Marketing Strategy of Amazon •
3ait'eeswaran =+,,,?$ in article 8&ains K &leasure of e-tailingN says that both
retailing and e-tailing will continue to co-e(ist for Cuite sometime to come. We don*t see e-tailing as complete alternative to physical shopping. 1learly$ both co-e(ist. What will happen is this7 people buying on the Het will start increasing slowly. Vuic#ly after some time$ there would be an e(ponential jump with people realizing that this medium definitely offers significant convenience. 5or need- based products$ the Het is becoming a very convenient way of buying. We strongly believe e-tailing will e(pand the mar#et in the case of impulse-based products such as boo#s and music. 0he Het offers consumers an opportunity to buy irrespective of where they are. 0his will clearly e(pand the mar#et.
•
ris"na* Arad"na and Harlam =+,,? $ in the article entitled$ F0he manufacturer-
retailer-consumer triad7 =iffering perceptions regarding price promotion e(plored that the effectiveness of any promotional strategy depends$ in part$ on how accurately channel members predict consumers* perceptions of their promotional activity. In this article they e(amined manufacturer*s and retailer*s beliefs about consumer*s 'and each other*s) perceptions of sales promotions and assess the accuracy of these predictions. 0hey found that retailers and manufacturers might hold similar but inaccurate views of consumer*s industrial #nowledge. %anufacturers and retailers consistently underestimated the level of consumer*s #nowledge. ;pecifically$ for consumer attribution about the financing of and sources of promotions$ channel members overestimated consumers* reliance upon simple$ causal attribution cues such as the location of the promotion. 5or #nowledge of store and generic brands$ manufacturers and retailers were inaccurate in predicting consumer*s beliefs. 0he similarity of supplier and retailer #nowledge bodes well for channel efficiency$ yet limitation in their understanding of consumer #nowledge about promotions might lead to wea#ness in channel mar#eting strategies. It was suggested that to improve the effectiveness of promotional strategies$ channel members should try to gather accurate data about consumer industrial #nowledge.
•
@inta A'u'a5ar and 3al CIulow =+,,+? e(plained$ in the article entitled$ F1ustomer
;atisfaction with ;upermar#et etail ;hopping that for supermar#et retailers wanting to build relationship with their customers$ being able to trac# their level of satisfaction Page 27
Marketing Strategy of Amazon with #ey elements of the supermar#et environment is e(tremely important. 0hey conducted a study to investigate the customer rating of importance of several attributes associated with supermar#et shopping. Analysis was based on data$ collected from ?,, customers and by using e(ploratory factor analysis. 5indings revealed that since retail format had become very standardized$ corporate reputation was rated high and might be a source of sustainable competitive advantage. Accessibility$ Cuality of service especially the friendliness and efficiency of chec#out personnel was considered important. It was found that large self service retail chains could not ignore the importance placed by customers on the attribute of service Cuality.
•
4ilson and Alan =+,,+?$ in the article entitled$ FAttitudes towards customer
satisfaction measurement in the retail sector* highlighted that customer satisfaction measurement had seen a dramatic growth over the past few years. %any service companies spend as much as half of their research budget on the measurement of satisfaction.
•
errie @ridson and 2elissa Hic5man =+,,7? $ in the article entitled$ F/oyalty
&rogram Attributes and 0heir Influence on etail 1ustomer ;atisfaction stressed that in an increasing competitive environment retailers are continually striving to find ways in which to attract and retain customers. As such$ loyalty programs have proliferated in the retail mar#et. 0hey introduced two dimensions of loyalty program Page 28
Marketing Strategy of Amazon attributed -hard attributes and soft attributes.
•
!aye S. 2cintyre and D6aniel !. Lync" =+,,7? in the article entitled$ FAn
9(ploratory 9(amination of 4ender Bias and 1ustomer ;atisfaction in the etail ;ector* suggested that ineCuities in customer treatment could affect attitudes towards the selling firm and overall satisfaction$ leading to loss of customer base and lower profitability. According to them a greater understanding of gender bias and some of its underlying causes in the salespersonPcustomer relationship could lead to an increase in the efficiency and productivity 'and therefore$ profitability) of daily retail operations. Based on AHGA test$ findings of this study confirmed that significant difference in the determinants of customer satisfaction e(ist between male and female buyers. Wait time and salesperson*s product #nowledge were both significant determinants of customer satisfaction for women$ but were not significant for men. It was suggested that understanding of these differences enabled the retailer in developing the mar#eting strategies to satisfy both male and female customers.
•
6eneen =+,,/? author remar#ed that customized retailing has evolved beyond
brea#ing a retailer*s store base into a few store types and suggested that the retailers must find ways to appeal to specific mar#et segments. 0heir product mi( must be relevant to the local climate and culture besides pricing. 0he retailers are shifting from mass mar#eting to target specific groups of consumers and becoming innovative increasingly.
Page 29
Marketing Strategy of Amazon •
&ester =+,,/? author highlighted new culture of retailing coming up in India as
decade ago vast majority of retail comprised of small family run shops. 0he bul# of consumer e(penditures used to be on necessities li#e food and clothing and foreign investment was not welcomed in the retail sector. 0he author gives a new picture of retailing in India which is changing at an unfathomable pace especially from the point of view of customers and retailers.
•
&ladwell= +,,/? concluded that even though retailers seems to #now more than ever
about how shoppers behave$ even though their efforts at intelligence gathering have rarely seemed more intrusive and more formidable$ the retail business remain in crisis. 0he reason is that shoppers are a moving target. 0hey become more and more complicated$ and the retailers need top #now more and more about them supply to #eep pace.
•
Huan$ !en$ =+,,/? $ In 0aiwan$ the e-commerce with the logistics system of
convenience stores has a new retail delivery model7 8Gn-line shopping in an electronic store and pic#-up goods in a convenience storeN. 0he major purpose of this study is to e(amine what #ind of improved services strategies can capture more mar#et share and customer loyalty for the convenience stores. 0he results indicate that the short-term promotion strategies do significantly affect the consumers* choice behavior on the pic#-up pointD however this is wea# in the long term because of customer loyalty.
•
S"ro-- = +,,/? remar#ed that few successful international ideas of modern retailing
have failed in India and the issues in failure are store location$ traffic and par#ing$ mall width$ customer facilities$ convenience and innovation$ clustering$ landscape $ lighting $ e(terior design$ special features$ investment and returns. 0he author also remar#ed that there are some challenges on front for India such as local traditions$ 5=I constraints$ ;trict govt policies$ whether protection$ family entertainment$ land constraints$ etc besides some of significant opportunities7 Increase in spending power$ more people in the age group of -$ emergence of middle class$ and willingness to enjoy international brand merchandise.
Page 30
Marketing Strategy of Amazon •
Sin$" C"owd"ary =+,,/? concluded in their study that customer retention is the
bottom line of corporate profitability and value in retail sector. As per the study it ma#es more business sense in investing in building loyalty rather than trying to woo new patterns. 0he study stressed more on the maintaining loyal base of customers in retailing. 0he study also suggested that it is necessary to first understand what shoppers are loo#ing for$ what motivate them to ma#e purchases$ and what drive them to shop at particular store besides understanding the types of shoppers who visit stores freCuently and what they represent in terms of your overall sales volume.
•
Sin$" 6utta =+,,/? remar#ed that the retailer must follow one point strategy-
differentiate or die and that level of differentiation can be achieved through strong relationship building with the customers and ma#ing them feel familiar $ comfortable and beneficial. 0hey further added that a service is another factor which adds value to the retailing. It never means 8good or great services it is actually better than one could ever imagineN. 0hey also pointed out that small retailer might have only one or two retail outlets as compared to large retailer having many stores$ but small retailer must thin# hard about why a customer should visit their retail store. emember that biggest retailer in the world was once a small with one store ac cross the street from the larger retailers in the mar#et.
•
Sin$" et.al = +,,/? have Cuoted ten secrets to successful mall operations listed as
&lanning$ branding$ mar#eting$ promotion$ leasing$ maintenance$ security$ hospitality$ and report #eeping. It was also mentioned in the article that global retail giants have learnt to deal with cultural and political obstacles but India has to have India specific way to come up with high standards retailing. It was also discussed India can not follow Wal %art and 0esco business pattern as the applicability of such models in Indian environment is little difficult.
•
Su'"as"ini aul =+,,/? $ in the article entitled$ F%easuring etail ;ervice
Vuality 9(amining Applicability of International esearch &erspectives in India e(plained that consumers satisfied with the store*s service Cuality are most li#ely to remain loyal. ;ervice Cuality is being increasingly perceived as a tool to increase value for the consumerD as a means of positioning in a competitive environment$ to Page 31
Marketing Strategy of Amazon ensure consumer satisfaction$ retention and patronage. =espite its strategic importance$ Indian retailers do not have an appropriate instrument to measure service Cuality. 0his study e(amined the etail ;ervice Vuality ;cale ';V;) developed in the 2.;. for applicability to Indian retail. 0his scale had been found appropriated in a variety of settings across different countries such as ;outh Africa and ;ingapore and across a variety of store types such as supermar#ets$ department stores and hyper stores. 0he data collected from "" adult shoppers at large format apparel stores in the city of Bangalore indicated that the ;V; could be used to assess overall service Cuality levels and for trac#ing overall improvements over a period of time.
•
Tane;a =+,,/? concluded that there is rapid series of change in the etail environment
and the Indian consumer is caught in the wind of change. With the evolvement of middle class and the retail sector$ the needs of modern consumer have changed and the consumers are e(posed to new #ind of shopping e(perience and services. 0he paper has introduced a few success parameters in positioning$ product$ image and mar#eting and 1%. 0he parameters includes patience$ compromise$ adaptability$ International product portfolio$ International Image$ customer intimacy$ sense of belonging ness to name a few.
•
Cadenat Amine = +,,) ) in their study concluded that customers* perceptions of the
assortment range stems from the combination of few indicators$ mainly number of stoc# #eeping units proposed and availability of favorite brands. 0hey also concluded that consumers overall evaluation of retail store depends largely on perceived choice with in the product categories where they are highly sensitive to the assortment range.
•
6FAndrea Rin$ et al =+,,)? in their study concluded that rather than emphasizing
their limited income$ emerging consumers as a group represent a sizable mar#et for consumer products. But they should not be addressed as a single group7 peculiarities Page 32
Marketing Strategy of Amazon among them underline the need for further segmentation$ as in higher income segments. 0heir needs should be better defined as basic instead of just simple$ and they do not just go for the lowest prices or second brands$ as they have mar#ed preferences that characterize them. 0his also reflects in their shopping habits$ which partly e(plains the resilience of the traditionalPsmall format retailers.
Page 33
Marketing Strategy of Amazon CHAPTER III Area o- Study
(LHASGA&AR
a
small
somewhere district.
A
town in
thane
&/A19
which is nowhere
left behind. A &/A19 full of crowd with mostly ;IH=
ambernath and #alyan. 2lhasnagar$ which is once a military cam area -or Sind"i re-u$ees mi$rated -rom Pa5istan* is now heavily populated with this community people. 0he city is also #nown as Sind"una$arand it is very famous from economic aspect. 2lhasnagar is a very good business
Page 34
Marketing Strategy of Amazon centre not only in 0hane district$ but also in %aharashtra ;tate. It is a city located on the coast of West India$ which is nearly :, #ilometers northeast of the city of %umbai. Birla temple$ furniture mar#et$ gajanand mar#et$ jeans mar#et$ 1entury rayon factory$ shiv mandiretc are the important places in 2lhasnagar. @rie- descrition% (l"asna$ar# =4?7 It is also #nown as 2lhasnagar camp- and it is located on the west side
of railway stations. 0he main center here is a mar#et with famous landmar#s li#e 4oal maindan where many people visit from nearby areas li#e #alyan$ ambernath$ badalpur$ dombivili$ thane$ titvalaetc for shopping. (l"asna$ar#+ =4?7 0he other name of this place is 2lhasnagar 1amp-. It is a mar#et with
popular landmar#s li#e 4ajanand mar#et and it is famous for clothing$ electrical and electronics etc. Hehru 1how# is the main centre here. (l"asna$ar#7 =4?7 it has another name as 2lhasnagar 1amp-. It is mainly a mar#et and it is
located on the west side of railway stations. 0he famous landmar#s here are furniture bazaar$ 30 1ollege$ ;apna theatre$ Asho#-Anil %ultiple( etc. it is mainly a furniture and electronics mar#et. (l"asna$ar / =E?7 0his locality$ which is also #nown as 2lhasnagar 1amp-$ is located on
the eastern side of railway stations and it is mainly a residential area. Uou can see several jean ma#ing small scale industries here. Jhulelal%andir$ ;wami ;arvanand ;chool$ ;wami ;hantipra#ash1how#$ Hethaji 4arden$ etc are the famous landmar#s here. 0his locality is heavily populated with ;indhi community people. Griginally$ #nown as alyan 2ilitary transit cam 'or 3alyan 1amp)$ 2lhasnagar was set up especially to accommodate :$,,, soldiers and ,$,,, others during World War II.Sind"is* in articular* 'e$an li-e anew in t"e new land. 0he area was converted into a township in !"!$ and named 2lhasnagar by the then 4overnor-general of India$ 1. ajagopalachari'literally Rcity of joyRD ulhasX joyD nagarX city). Gn August ?$ !"! the first and last 4overnor-4eneral of India$ 1. ajagopalachari$ laid the foundation stone. As said earlier$ 2/
Page 35
Marketing Strategy of Amazon
0he city has colleges and an industrial-training institute li#e institute of technology$
&rowt"%
2lhasnagar$ one of the busiest business centers in %aharashtra$ has several jewellery showrooms. ;ome of the popular jewellery showrooms in the city are listed here. We can watch the gradual development of 2lhasnagar to a shopping hub and business centre from a military camp area in the pre-independence era only with wonder. ;indhis$ who migrated to this land from &a#istan$ has significant role in the growth of 2lhasnagar in the business field. 9ven though they came to the city with minimal resources$ now most of the small and big shops in 2lhasnagar are under owned by them. It is nothing else but their hard wor# and talent that made them able to develop this city to a Fmini-Japan* during the last five decades.
Secialities%
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Marketing Strategy of Amazon
2lhasnagar$ which is the most popular industrial and commercial township of0hane district$ is famous for shops of wedding costumes$ jeans and other readymade garments. ;indhi people$ who live other parts of India such as 4ujarat$ 4oa and %adhya &radesh$ visit 2lhasnagar to do their wedding purchase. 0here are many shops$ which are e(clusively aimed for wedding costumes 0he city is also famous for jeans manufacturing. Jeans and ready made garments manufactures at 2lhasnagar are sold in all mar#ets of the country. %any popular jeans brand have factories in 2lhasnagar. T"e most 'usy commercial and s"oin$ center "ere are (l"asna$ar + 7. 0ourist
Attractions in 2lhasnagar7
0here are several tourist attractions in 2lhasnagar including beautiful locations$ religious places and historical monuments etc. ;ome of the famous temples in 2lhasnagar including C"ali"o Sa"i'* @irla 2andir* "a;i 2alan$* :"ulelal Temle* Saint Satram6"am and Swami S"anti Pra5as" Temle etc. (l"asna$ar City Census%
Page 37
Marketing Strategy of Amazon (l"asna$ar City
Total
2ale
!emale
&opulation
/,)*>71
6,$6
:$:"
/iterates
8,*>/>
6$!6
?,$!?"
1hildren ',-:)
8*/7
$"!
$,
Average /iteracy ')
>.+
!.,
?".6
(l"asna$ar and asset allocation% But each and every person who is earning by way of
business in the form of profits or by doing jobs in the form of salary is having some sort of stress about their earnings as 852029 I; HGW<99 ;A59N. As it is rightly said by A@RAH2 LIGCOLG about the future that 8 the best thing about future is that it comes only one day at the time.N And that day can be the day of your utmost reCuirements- can be in the form of liCuidity. Any thing can happen in future. How a days people are almost aware about the unforeseen things happening in future. ;o many people have started thin#ing about future and have started investing in different areas$ to control or minimize ris# associated with future. %any people invest in stoc#$ bonds$ eCuities$ ban#s$ mutual funds$ gold etc.to diversify ris#. I just want to #now that how many people in 2lhasnagar are aware about their future and how they are diversifying ris#. &eople not only invest in different #ind of securities to save their future$ which is about to come. But the main reason to invest in different avenues is to get ma(imum rewards in terms of profit. As by investing in different avenues there is less ris#$ because if the poor performance of anyone avenue will not affect much$ because the profit is about to come from other investments too. If we loo# at the history of 2lhasnagar$ where appro(imately twelve to fifteen years bac#$ people here were only business oriented and most of the population of woman were living at homes as housewives. But slowly and gradually everything got change and the process of
Page 38
Marketing Strategy of Amazon change is still ongoing. ;imply everything is getting modernized. 0he narrow thin#ing of people is getting broadened$ girls$ woman are also indulged in doing jobs along with managing their household wor#. As everything is getting modernized$ but beside this people of 2lhasnagar never forget their culture $ here every festival is celebrated with great joy. As 2lhasnagar is a business hub$ but along with this$ it is a culture-oriented place. 1oming towards asset allocation of 2lhasnagar people - If we ta#e business oriented people as investors$ the main reason of their investment in different #ind of securities is to get ma(imum rewards in terms of profit. Gn the other hand$ if we consider salaried people as investors$ the main reason of their investment in different #ind of securities is to overcome the ris# associated with future and to a certain e(tent profit earnings too. 5rom the above study on area$ it could be understood that people of 2lhasnagar lives a lu(ury life$ of course not all$ but most of them. 0here consumption pattern and buying behaviour towards various brands of products is much different as compared to other customers because of their standard of living. &eople of the town are very easily attracted towards the brands which are endorsed by the celebrities. 1onsidering the lifestyles and choices of people and their preference$ pesent study seems to fit with the town of 2lhasnagar.
Page 39
