Amazon's Competitive Analysis

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Competitive Analysis

Competitors are the firms that compete to serve the same customers in the same marketplace. Competitors can compete directly or indirectly. Competition happens on two levels: Product or service competition.

Due to the shift of focus for Amazon, it has become the "Earth's biggest anything store". Its competitors have expanded from just online book retailers Barnes and Nobles and Borders to top audio retailers and online auction house Amazon has an overall lead of 40% market share against the other online retail firms. Their international business has more than doubled over the past 2 years

Amazon's primary value chain includes purchasing/sourcing, marketing, distribution and after-sales services, which includes returns and exchanges from unsatisfied customers. Their main focus is in the purchasing/sourcing and in the distribution of the products to the consumers. Their investments are therefore, geared towards warehouses in key points of high consumer demand areas and an efficient delivery and distributing system to service all its consumers.

Thus, Amazon controls most of its distributing system that spans across borders.

How does Amazon compete?

Competes through Quality, service, and low price.

How effective is each?

Quality - they make sure that their product reach the customer with no damage and always serve their customer with the best product.

Service - Amazon delivers the product within a week. Less lead time

Low price - reasonable pricing.

How powerful?

Amazon is power because they were the first to start an online business. They have more customers due to this. The customers are loyal to Amazon and will do their shopping only at Amazon. Amazon is very profitable and is doing well currently. How aggressive? has remained on top of the online retailing business despite the entrance of giants such as Barnes and Nobles and Borders. Their success...