An Introduction to Amazon

September 18, 2017 | Uncategorized | By admin | 0 Comments

This semester, I am really excited to be researching Amazon. Specifically, I am going to begin my research by doing a brief overview from the start of Amazon to where they stand today. Amazon’s incredible success has forced large department stores such as J.C. Penney, Macy’s, and Sears to close over 100 stores each over the course of the last year. Even some of the most popular clothing brands including American Eagle, Lululemon, and Urban Outfitters have seen stocks tumble to all time lows this year. A significant part of my research is going to include Amazon’s impact on smaller, more entrepreneurial companies in addition to larger companies. Just thinking about the fact that Amazon has forced so many companies to cut down on their stores, I imagine that smaller companies are going to have to really carve out their individual niches to stay in business in a competitive marketplace.

It comes as no surprise that a huge contributor to Amazon’s success is the highly technology savvy world that we all live in today. The role of eCommerce is huge. Between 2010 and 2016, Amazon’s sales in North America more than quintupled, growing from 16 billion to over 80 billion dollars. Another impressive statistic is that there are over 80 million Amazon prime subscribers in the United States, which accounts for about a quarter of the population. Amazon prime is a package that customers can purchase for $99 a year which guarantees free shipping within two business days. It is also said that each subscriber spends about $1,300 annually on the site. When the first online retailers were getting started, media and entertainment were the big sellers. However over time, consumers have become so used to purchasing products over the Internet. Improved delivery times and a focus on making online purchases as smooth as possible have led to dramatic increases in apparel sales, which now make up the largest category of online purchases. Apps and mobile wallets have made it incredibly simple to make purchases on-the-go.

In summary, it is Amazon’s simplicity and convenience along with its impressive inventory and selection that have played substantial roles in its success. Consumers can now purchase almost any general item they need on Amazon and thanks to Amazon Prime, can typically receive the item the next day. A hot topic on the news over the last month has been Amazon’s acquisition of Whole Foods, allowing Amazon to delve into a whole new market, the grocery business.

A lot of smaller companies don’t necessarily have the funding or the work force that Amazon has to produce anywhere near the quantities of products that the e-Commerce giant does. However, the best way for a smaller retailer to compete is to provide a unique service, product, or experience that is unique to each individual. An item such as a wedding dress is very customer specific and provides an individual experience that Amazon does not serve. I am looking forward to researching some specific small companies such as Shipt, an on demand grocery service that employs local shoppers to do the buying and delivery of groceries to end users, Blue Apron, an ingredient-and-recipe meal kit service, GrubHub, an online food ordering company, as well as others.

While it may seem like Amazon is the end-all-be-all, they can’t be everything to everybody. When someone wants an experience, Amazon is not always the preferred place to go, hence why many smaller business will still always be able to thrive.


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