In order to analyze the marketing strategies adopted by a firm, it is necessary to have an overall idea about the operational process and marketing approaches adopted by the management of such business. The given section briefly focuses on the evaluation of Amazon’s operational process in terms of its marketing initiatives through the SWOT framework. In addition, the brief corporate aims and objectives have also been presented herein for the purpose of subsequent references and analysis.
One of the corporate aims of Amazon is to achieve a large number of customer bases across the globe for grocery products. In addition, the firm intends to maintain a steady bottom-line as well for future growth and expansion strategy. Besides, the firm aims to reduce the carbon emission with the help of use of renewable energy in their operations in a larger network system (“Amazon Corporate Mission”, 2018). Lastly, it may also be construed that Amazon has targeted employment generation objective on a yearly basis and tries to ensure that the target is being met in the most efficient manner. The quote below is the excerpts of Amazon’s corporate mission and vision statement:
“Our vision is to be earth’s most customer-centric company; to build a place where people can come to find and discover anything they might want to buy online.”
The concept of marketing has been changing with the pace of time and the two different schools of thought have emerged in this given context. The section below highlights, in brief, these two school of thoughts related to old and new DNA of marketing in the context of Amazon.
Amazon, as mentioned earlier. Is the world’s one of the biggest online retailer. It is an American company based in Washington. The company was founded by Jeff Bezos more than 20 years back. The company has been listed in several stock exchanges across the globe and employs almost 613,300 persons worldwide as per latest report (Levy, 2018).
The product line of the business has been diverse and may include books, DVDs, accessories, software, apparel, consumer electronics FMCG. Groceries, health products, and sports goods and etc. some of the prominent segments are Amazon Prime, AmazonFresh, Alexa, Kindle, Amazon Drive, Amazon Studios etc.
Amazon employs a multi-level sales strategy and prioritizes both B2B and B2C relationship through its operations. The firm focuses on business to consumer relationship by selling products directly to them. In addition, the firm allows the other businesses to sell their respective products to their end consumers through Amazon’s own platform (Taecharungroj, 2016). In other words, Amazon facilitates B2C marketing as well. In terms of the B2B framework the brand maintains a voluminous network of vendors with whom they have a business relationship in terms of logistics support and distribution mechanism (Jaworski, 2017). In addition, Amazon adopts an affiliate program in which the other marketers may post their business links in Amazon’s portal and thereby attract customers through a commission based system which runs on the basis of click-through mode (Menon & Menon, 1997).
Old Rule of Marketing
The concept of marketing has changed radically and also with time. In earlier days, the focus was only on products and the main intention behind the advertisement was to attract potential customers with hype! It is needless to mention that the management in earlier days used to put more focus on 4P’s of marketing which is Product, Price, Promotion, and Place (Iyer, Davari, Zolfagharian & Paswan, 2018). Each of those Ps was accordingly strategized for the business so that the end result turns out to be the conversion from potential customers to actual customers (Kennedy, Kemper & Parsons, 2018). However, the process was devoid of value generation for the consumers which eventually got thrashed by the market due to its ever dynamic nature. For example, the business houses used to prioritizes the product and its salient features. The product was priced considering the consumer’s ability to pay. Besides, the promotion and advertisement were localized and placement of hoarding or banner was a matter of consideration (Jaworski, 2017). Lastly, the promotional methods were adopted based on the budget set for the given purpose. It is needless to mention that all these 4 components were assessed and accordingly strategized for the benefit of business and hence the customer focus was absent (Iyer et al, 2018).
The old DNA of marketing brings some of the key features which are listed as below:
It may be conceived that the old school of marketing avoided the customer centricity and hence new school of marketing emerged (Merrilees & Fenech, 2007). In spite of the fact that old school of marketing has been almost outdated now, there still have been few instances where it may be asserted that old school of marketing techniques have been widely and to a great extent, successfully used by the marketers (Jaworski, 2017). Flyers, for example, are being regularly used by the business houses who emphasize on localized marketing. Also, management, at times, may heavily rely on the promotional items and gifts for the purpose of attracting newer base of customers who do not have the idea or any inclination towards the product or the offerings (Taecharungroj, 2016). Most of the times, these tool work for the benefit of the business and therefore, it may be conceived that these tools and techniques may still be considered to be traditional and worthy for the business houses.
In line with the previous discussion, it may be added that the new school of marketing has focused on the customer and value creating proposition (Merrilees & Fenech, 2007). Customers want values and that is the reason people tend to be more quality conscious rather than price sensitive (Kennedy, Kemper & Parsons, 2018). There have been instances where apparently same product is being priced differently because the product features and subsequent offerings vary substantially, for example, Toyota. The brand has been able to manage to earn a great amount of customer loyalty only because fit is the after-sale support that may run up to 5 years post sales (Uhlig, 2018). This phenomenon is nowadays very common and has to be inculcated within the marketing strategy as well. Presently, the customers having disposable income do not want to bargain on price but simultaneously do not want to compromise on quality as well (Kennedy, Kemper & Parsons, 2018). In other words, the cheaper product with substandard quality will reduce the market value of the brand to a great extent. On the contrary, an excellent value proposition with quality service coupled with premium pricing will earn customer loyalty and satisfaction (Merrilees & Fenech, 2007). This is the reason nowadays the old rule of 4 Ps of marketing has been changed to 6 C’s of marketing (Uhlig, 2018). These components are contact, community, conversation, consumption, connect and consideration. To put it differently, the marketers now have to contact with the prospective customers, build the relationship through constant and effective conversation and consider their priorities and accordingly place the offering for the greater good of the community as a whole (Uhlig, 2018).
Based on the discussion, some salient features of a new rule of marketing may be listed as below:
Therefore, it may be concluded that new DNA of marketing has shifted business focus from product to value; from business to customer and from profit to society (Iyer et al, 2018). The concept of marketing DNA is a critical success component for the business and helps the management with choices coupled with corresponding benefit offerings for the business in order to undertake efficient and informed marketing judgments (Ghosh, 2018). Marketing DNA provides various approaches relating to marketing strategies that may primarily focus on being sales-driven or the offering innovator. Besides, the strategies may also pertain to the process of winning customer experience and hence customers’ insight- driven. Modern approach of marketing also aims to build an iconic brand value in the market (Mogilko, 2016).
As mentioned previously, the management of Amazon has adopted different modern marketing strategies to reach out to the customers. One of the tools is web analytics. Since Amazon has a huge number of the customer base, based on the web analytics, the firm may get an idea about the customer’s purchase habit and thereby provide a recommended solution to them as a value-added service. For example, any product bought from Amazon’s platform may be followed by the email from the firm suggesting similar products that may be of interest to the specific customers (Iyer et al, 2018).
There has been a very low-profit margin for the firm for long and analysis may reveal that free shopping offer consumes a major portion of the same. However, considering the brand building perspective, the offer immensely adds value to the firm in terms of customer loyalty and brand value (Ghosh, 2018).
Continuous innovation is another critical consideration for the firm in devising their marketing strategy. All the products and offerings have been continuously and constantly evolved to suit with the changing landscape of demand of the customers. Kindle, for example, has been introduced by the firm for the people who may not be able to afford to study hard copy books (Kennedy, Kemper & Parsons, 2018). Such innovative initiatives through a sustainable brand building exercise have helped the company to achieve wining customers’ experience.
Lastly, the media sales may also be termed to be superior marketing strategy employed by the brand which allows the firm to sell their own marketplace to other advertisers and thereby earn commission and simultaneously achieve a branding in own niche audience (Ghosh, 2018).
In nutshell, it may be concluded that the marketing strategies adopted by the organization has been quite modern and updated with the latest technology. In this context, it may be conceived that new DNA of marketing focuses on the technological advancement and the business must assimilate the current technological updates in its marketing strategy framework in order to be updated with the latest trends (Kennedy, Kemper & Parsons, 2018). Since the management of Amazon has been doing the same for past several years and that too on a consistent basis, it may clearly be established that the firm has effectively applied new DNA of marketing.
The tools as explained earlier have all been extremely effective for the firm in terms of customer acquisition and brand building. The overall sales of the firm have been more than 56 billion based financial data in the report for the quarter ending September 2018 (“Amazon Nasdaq”, 2018). Such a huge amount of revenue may clearly be construed to be the result of such successful marketing tools adopted and implemented by the firm in their operations. The continuous growth and regular innovation that may cause disruption in the market is the primary target of the firm and the management has been actively engaged in devising such types of marketing strategies for the business so that the customers get a value offering and maintain a long-term relationship with the brand.
Conclusion
Based on the discussion and analysis performed in the preceding sections of the report, it may be construed that the marketing strategy is an ever-evolving study and hence very much dynamic process. The management of every business may need to consider the same while chalking out the respective strategies for the business (Fahmi Al-Zyoud, 2018). Since the marketing and promotional strategies are directly linked with lots of qualitative factors like customers’ sentiments, choices and preferences and even the changing demand patterns for specified sets of goods and services, the management may need to be cautious all the time so that those changes may be incorporated within the offering and make the offering a valued one in the market (Mogilko, 2016).
The discussion, as well as evaluation of the Amazon’s marketing strategy in the context of new approaches and DNA of marketing, helps the researcher to arrive at a recommendation that the firm should diversify its marketing process in order to mitigate the marketing risk. The present strategies as adopted by the firm have been providing to be extremely worthy and the management is advised to continue the same in future also (Abdullah Saif, 2015). However, considering the fact that the industry is ever-changing and online retailing market still has the huge potential to grow in the coming years, the firm may need to focus more on the value proposition and customer satisfaction. It may be concluded that the business is not about selling the product or services but providing ultimate benefit to the customers who actually need it. Hence, the corporate aim of sustainability and brand building will be successful if the management judiciously concentrates on value proposition rather than selling proposition (Avlonitis & Papastathopoulou, 2000). It may be recommended that an effectively devised marketing strategy that focuses on the customer relationship and experience will surely contribute largely towards the attainment of corporate goal and approach toward sustainability in the long run in time and cost most efficient manner (Denning, 2018).
References
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