Question

Describe Amazon organization. State its commodity, business model, target market, specialization, product differentiation, pricing strategy, and market share. In addition, describe the market structure it operates in (monopoly, oligopoly, monopolistic competition, or perfect completion) and state the characteristics of this business that make it fall into this market structure. Moreover, state the organization’s main competitors and the strategies it uses to remain competitive in the market. In addition, state that one characteristic that its commodity has that makes them unique in their market.

Answer 1

answer-

Amazon is a big global e-commerce company. Amazon was founded by Jeff Bezos on July 5, 1994, in Bellevue, Washington. The company initially started as an online marketplace for books but later expanded to sell electronics, software, video games, apparel, furniture, food, toys, and jewelry. it also offers web cloud computing services and online streaming services to customers.

Amazon operates a business model with many moving parts. First and foremost, the company sells goods directly. A percentage of products are offered to buyers through Amazon's online storefront with a small markup, and inventory is kept in the company's large network of warehouses. Most consumers visit the company's site assuming its products are less expensive and readily available for purchase and shipping.

In addition to direct sales, Amazon provides a platform for other retailers to sell products to buyers. Products sold through Amazon's partner retailers are often less common items or those with a higher purchase price, allowing Amazon to avoid holding slow-moving inventory that could dilute profit. While Amazon does not assess a fee for its retailer partners to list items for sale, the company does retain a portion of the sales price as commission.

Amazon also maintains a subscription-based business model through its Amazon Prime service, as well as a small electronics product line. Under a Prime account, customers pay an annual fee to secure free two-day or same-day shipping on eligible items and have access to streaming media, such as digital music or movies. Amazon also generates revenue from selling its e-reader, the Kindle, and the e-book and mobile application purchases offered to Kindle owners

The amazon is certainly aimed at a wide audience who are interested in internet shopping. The range of items for sale that Amazon offers would suggest that they wish to target customers of all ages from young to the old.

the pricing strategy of amazon is low cost pricing in which it offers products at low price to customers which helps amazon to create a huge customer base and gain market share in the industry.In 2017, Amazon's market share of the U.S. e-commerce retail market was 37 percent, and this is expected to increase significantly by 2021.

the market structure of amazon is perfect competition because even Amazon comes close to controlling 50% of all retail sales. There are thousands of large and small retailers and tech companies operating today, with new entrants entering the market on a continuous basis.

the main competitors of amazon are Walmart, target, Costco, Alibaba etc Amazon uses low cost leadership strategy in which Minimization of operational costs is the objective in this generic competitive strategy. For example, Amazon.com uses advanced computing and networking technologies for maximum operational efficiency, which translates to minimized costs . it also offer prime service in which it promise to deliver products in one-two day delivery to prime members.this fast delivery service makes amazon unique as other company not offer such fast service like amazon.