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MKT501 Marketing Management: Strategy of Amazon

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Task

The final stage of the marketing audit is for you to evaluate how well the marketing mix of the organisation is performing for your chosen organisation.Incorporating theoretical concepts into your discussion  use of other theoretical sources and secondary research, please discuss the following:

  1. Outline and describe the 8 marketing mix concepts theoretically and apply the components to one of your products offerings. As part of your application be sure to explain and evaluate all of the 8ps’ of marketing (product, prices, promotion, distribution, partnerships, people, processes and physical evidence).

    2. Given your evaluation of your overall marketing strategies, the competition and broader contemporary issues facing marketers today, provide recommendations for your organisation. Your recommendations should focus on each of the 8ps and illustrate how contemporary issues may impact on your organisation and its marketing strategy.

For example, for this report, contemporary issues may include, but are not limited to, Corporate Social Responsibility, social media interactions, advances in technology, ethical concerns, environmental concerns and globalisation etc.

Answer:

Introduction

In the growing competitiveness of the businesses in Australia, it is essential for an organization to design and implement effective marketing strategies in order to ensure the smooth running of the business operations despite of lots of market risks, uncertainties, and challenges in the Australian market. This report will describe the marketing mix components and will evaluate whether the marketing strategies and mix elements evaluate the performance of the company. It will also evaluate the overall marketing mix strategies, competition level and broader contemporary issues facing the organization. The appropriate solution or recommendations will be provided to overcome the issues or challenges faced by Amazon so that appropriate changes could be made in its marketing mix strategy (Codita, 2011). For this assessment, the world’s leading e-commerce company Amazon.com is taken that is an intermediating retailing firm between the seller and buyers to facilitate the electronic order tracking, and commercial transactions electronically for attaining the large amount of the sales across the Australian markets. 


Company Profile of Amazon

Amazon is the world’s largest e-retailing company based on the cloud computing technology based e-commerce operations. Amazon Company was established by the founder, Jeff Bezos on 5 July, 1994 having its international operations as well as e-commerce operations in the Australian country. Amazon is the largest e-commerce retailor in Australia as well as rest of the world by the market capitalization and sales revenues. Amazon is the most valuable public limited company in Australia based on the customer-centric electronic business operations. It has its e-commerce based worldwide operations with its 7 international websites e-commerce websites for different countries including specific e- retailing website https://www.amazon.com.au/ in Australia (Chaffey, 2014). Amazon offers a range of electronics items, households and kitchen appliances, packed foods and beverages items, furniture, books, kindle, toys, apparel, jeweler, child entertaining items, cloths, health supplements and nutritional products, CDs/DVDs, books, fire TV, video games, and other products to the customers across the countries.

Marketing mix strategy of Amazon

Product- Amazon is one of the leading e-commerce platforms in Australia that delivers its products (Amazon books) to the customers through its website (amazon.com.au) and apps. It has wide and diversified product portfolio for the Kindle Books or e-books including a wide range of the books for the online purchasing by the customers in Australia. Amazon is the best Australian seller for the kindle books, such as The Trapped Girl, My Sister’s Grave, The Rise of Olympus, Victim Without a Face, What Doesn’t Kill You, Cameron of the Skies, The Agent, Their Lost Daughters a Gripping, Into the Water: From the, Abandon, Hard Road, The Woman Who Stole My Life, Rockus (Sinners of Saint Book 3), The violinist and Ballerina, Wild Ride, The Darkest Night, My Husband’s Wife: The Sunday, Into the Water: From the bestselling Author of the Girl on the Train, and may other kindle books offered to the Australian customers for purchasing online by using Amazon’s website and apps (Amazon, 2016).   

Pricing- Amazon is the worldwide seller with the high brand presence in Australia for the Kindle books/e-books. Amazon is known for low-priced and high quality web hosting solution that uses the competition-based pricing strategy for offering the kindle books at cost-effective or competitive market prices. It offers kindle books at different prices ranging from 1AUD to 30 AUD depending upon the books. It prices for some popular kindle books are The Trapped Girl (2 AUD), My Sister’s Grave (2 AUD), The Rise of Olympus (1.28 AUD), Victim Without a Face (5.18 AUD), What Doesn’t Kill You (5.34 AUD), Cameron of the Skies (6.67 AUD), The Agent (6.69 AUD), Their Lost Daughters a Gripping (3.99 AUD), Into the Water: From the, Abandon, Hard Road (14.99 AUD), The Woman Who Stole My Life (4.99 AUD), Rockus (Sinners of Saint Book 3) the kindle price is 1.33 AUD, The violinist and Ballerina (2.63 AUD), Wild Ride (4.01 AUD), The Darkest Night (4.99 AUD), My Husband’s Wife: The Sunday (4.99 AUD), and Into the Water: From the bestselling Author of the Girl on the Train (14.99 AUD) (Amazon, 2017). 

Placement- Amazon is a global giant seller having the significant market presence with wide e-commerce operations in Australia for offering the e-books/kindle books through its own website amazon.com.au and Amazon app. It offers online books through its own website and apps of Amazon.com.au to place the delivery of books as per the customer orders through the distribution channels and fulfillment centers of Amazon. It has its own warehouses for the customer return and specialty items of Amazon, such as kindle books, and fulfillment centers for transferring/moving a range of Kindle books to its distribution centers and from where the books are delivered to the customers within 2-5 days of after receiving the customer orders. It also uses the local postal and courier services for the transportation of the books and delivery personnel for the home-based delivery to the customers (Bhasin, 2017). It uses the conceptualizing of its own distribution networks for facilitating the delivery of the books.    

Promotion- Amazon is the leading e-commerce retailor for e-books/kindle books in Australia that uses the aggressive and effective marketing campaigns to promote the branded Amazon books throughout the Australian country. This is an important component of the marketing mix that Amazon uses to promote the kindle books for creating the high brand awareness and loyalty into the Australian customers for the Kindle Books or popular e-books. It uses the website promotion, social media advertising (Facebook, Twitter, LinkedIn, Instagram, Pinterest, YouTube Channel, Google+), TV commercials, advertising websites, e-CRM tools, publishing ads in newspapers, magazines, brochures, and pamphlets. Amazon.com.au uses television commercials and affiliate programs where advertising websites and blog owners advertise Amazon products, such as Kindle Books links in their platforms (Chaffey, 2015). Amazon also uses the sales promotional tactics, such as discount sale or cost cutting rates during the holidays or festivals or special occasions. It also uses the public relationship programs, such as Amazon Smile or working with NGOs to improve the brand image while donating to the charity organizations. It also performs the direct marketing to enhance the sales figures for e-books of Amazon through directly contracting with the customers. 

People- Amazon is the largest e-commerce company in Australia that employs the skilled, talented, and experienced employees having the adequate job competences for delivering the effective customer service through offering the Amazon Kindle and online Books to the customers in Australia. Amazon takes care of the employees and gives importance to the employee motivation and welfare by providing them adequate pay structures, remuneration and rewards, training and skilled development programs, health benefits, medical schemes, assistant programs, equity plans, and vacations (Slide Share, 2016). It has 2, 30,800 employees worldwide for delivering effective customer service operations to the customers. Amazon is the most visited site in the world in retail with1.27 billion/year visits online. The employee motivation and job satisfaction encourage them to give their valuable contribution for the attainment of the business objectives and goals. 

Physical evidence- This is another additional marketing mix element of Amazon that shows the physical presence or location of the service operations for the Amazon Kindle and Books through its own website that are user-friendly and design to suit the users. It has a lot of warehouses, storage centers, and distribution and fulfillment centers in the Australian country to offer the Amazon Kindle and Books as per customers’ order through its website. This element shows the ability of Amazon to tangibilize the intangible aspects of the company for providing the physical evidence of service quality outcome for offering the books through its website and distribution centers (Smithson, 2017). The physical evidence also includes the signage with service location, service layout and ambience, and a formal and recognized way for meeting the customers’ needs. 

Processes- This component of the marketing mix refers to the methods and processes for managing the customer service operations in order to deliver the effective customer services for offering Amazon Kindle and Books electronically. Amazon is the market leader in e-commerce having strong processes based on the customer centered, Business-led, and IT supported design. Amazon has its warehouses, distribution centers and fulfillment centers for the operational efficiency of the processes of Amazon in Australia. Amazon uses the best technology to support its daily business activities. It uses the social media sites for servicing the customers effectively by providing them information of the location of the service delivery of Amazon books electronically (Tran, 2015). The customer relationship management and information management are the core fundamentals of its strategy. The processes of Amazon include getting the customer orders, managing inventory and customer delivery, handing the customers’ grievances procedures or complaints, and processes for understanding and identifying the customers’ requirements and buying behaviors. 

Partnerships- Amazon is a giant seller for Kindle Books in Australia that has been selling a range of kindle books for last couple of decades. Amazon Web Services (AWS) has AWS Partnership Networks (APN) for building successful AWS-based businesses or solutions to assist in technical, business, marketing, and on-to-go market support. AWS Partner Network (APN) has opportunities to develop new business solutions for Amazon to seek significant business growth with the opportunities provided by the APN programs. The APN partnership networks enable to grow the businesses of Amazon and better customers support (Schneider, 2017). AWS has APN technology partners (Saas, Paas, Independent Software vendor (ISVs), and Management and Security Vendors) to provide the technological solution to AWS. AWS has APN consulting partners including System Integrators, Agencies, Strategic Consultancies, Managed Service Providers, and Value-Added Resellers to assist in customer design, architect, migrate, build, and manage the workloads and system applications on the AWS. 

Evaluation of Marketing mix strategy of Amazon

From the marketing mix of Amazon for the proposed product, Kindle Books/e-books, it is evaluated that the marketing mix of Amazon is not so effective that requires a lot of improvement in its 8Ps or all marketing mix elements, product, pricing, distribution/placement, promotion, people, processes, partnership, and physical evidence in order to run its sustainable business operations in the Australian markets effectively for maintaining its leading or dominating position in the relevant Australian industry. Amazon is a top e-retailor for the Kindle Books in Australia that could use effective marketing strategies for enhancing its retailing operations in Australia (Kerin & O’ Regan, 2008).

The product development or launching strategy of Amazon is not more effective because it is dependent on the retailing brands or books publishing industries for offering the books online to the customers. Along with this, the popular kindle books are available only on its websites that the customers may face problem in purchasing the books of their requirements or preferences for the business purpose/reading purpose/study purpose. It may also contract with the books publishing agencies or e-books providers for offering the wide range of literature books, academic books, education course books, journal books, magazines and other books for availing to the customers across the Australian markets (Graham, 2015). The marketing mix strategy of Amazon has been facing the challenges, such as ethical concerns, CSR problems, environmental protectionism issues, and community pressures, globalization impact and competitive strategies, and technological advancement that affect the marketing mix strategy of Amazon in the Australian country.

From the Australian surveys report, 2016, it is identified that the most of the Australian retailing brands as well as branded books publishing industries are not ready for launching their retailing branded products as well as course books and e-books because of its competition-based ricing or low cost pricing strategy that lowers down the prices of the books online while compared to the physical books stores in the consumer markets. Amazon could set the prices of the books economically by maintaining the balanced position between the online prices of its own and market prices in the physical customer markets (D’Onfro, 2015).

The firm could also grow its businesses through its physical market presence along with the online presence in the Australian markets by opening the stores of own brand for selling books in the markets. It could enhance its warehouses in numbers for more storage facility and distribution centers for placing the customer service delivery more effectively. Along with this, it could more focus on the social media advertising campaigns rather than publishing or print media because of the growing significance of the social media in the brand awareness and customer loyalty. It could also use the brand positioning, market segmentation, and targeting strategies to target the high-potential or rich consumer markets in Australia (Management Sudy Guide, 2015). It could organize the brand awareness programs, publicity programs, promotional events or other sponsorship events for enhancing the corporate brand image of Amazon in the Australian country. It could also make partnerships with the book publishing agencies or course book providers for increasing its selling capacity by offering the wide categories of books to target the needs of diverse customer groups.

The firm could also bring improvement in its processes for providing the right and accurate information about the products, attending the customer complaints and listen these properly, and providing an appropriate solution for the customer satisfaction, and fastest customer service delivery processes. The firm could employ the persons or employees having adequate job competencies, good market knowledge, and ability to deliver effective and frequent customer service delivery (McKevitt, 2017).

Recommendations for improving the marketing mix of Amazon

The marketing mix strategy of Amazon is affected by the contemporary issues, such as globalization impact, growing competitive trends, competitive market demand, changing demographics, distinct customers’ needs, preferences, and life styles, CSR and ethical issues, environmental concerns, and community pressures. Appropriate changes could be made to the marketing mix strategy of Amazon for running the sustainable e-commerce operations through its website and apps for the proposed products, such as Books (Egan & Thomas, 2012).

The Amazon Company should not be limited to kindle books in the Australian markets rather it should offer the course books, literature books, academic books, magazines, learning e-books, journal books, and author books for meeting the needs of diverse categories of the customers for availing them the complete book solution through its website and apps. Amazon should adopt the economic pricing strategy to offers books at economic or cost effective prices by maintaining the balanced pricing situation between online prices and consumer market prices of the physical stores so that the prices of the consumer markets could not be affected. The economic pricing strategy will also be effective to win the confidence of most of the Australian brands and the Australian books publishing agencies for selling their branded retailing items and books in the large quantities (Ferguson, 2017).   

It will be effective for Amazon to enhance its storage capacity beyond the limited stocks capacity through the large number of warehouses, distribution centers, and fulfillment centers for storing and distributing the books in the more quantities for selling them frequently as per customer orders. It can also open its own amazon branded physical stores to enhance its physical brand presence for offering the wide range of course books, literature books, academic books, cooking books, theatre books, comics, and magazines through its stores (Glowik & Smyczek, 2011).

Amazon should enhance its corporate brand reputation by creating the brand awareness and loyalty among most of the Australian people for encouraging them to purchase the Amazon Books by deploying effective marketing campaigns. It could be effective for the company to use promotional campaigns, such as social media marketing by advertising the digital posts, video contents, displaying images, and promotional video contents by linking these with the social media sites and channels. It could also be effective for Amazon to promote the books through the sponsorship websites (usu.edu.au, manningbar.com and hermannsbar.com), promotional events, publicity programs, sales promotional tactics, and brand ambassadors to promote the branded books for purchasing by the customers (Ferrell, 2012).

Amazon should also make strategic partnerships with the Australian retailing brands for selling their branded retail items in more quantities. It should make the strategic partnerships or trade arrangements with different books service providers and books publishing agencies to sell the wide varieties of the books on its e-retailing store through its own website and apps. It should employ the best, skilled, and high potential service staffs with good job competences and huge experiences for offering the effective customer service delivery by ensuring the reliability, speed, and customer satisfaction because Amazon business is primarily focused on the customer-centered business (Hunt & Bush, 2011). Additionally, it could also be effective for the firm to adopt the corporate social responsibility principles and ethical fundamentals for ensuring the high professional standards and ethical conducts of businesses in the customer commercial transactions, product related information, employment practices, employee treatment and welfare, and effective customer service delivery.

The firm can also consider and practice the environmental protection awareness programs, such as eco-friendly programs, sustainability brand awareness programs, environment donors and community relationship programs, and pollution control and reduction of waste disposable or unused items for representing the good corporate brand image in the Australian markets. In order to overcome the challenge of the language barriers and communication problems, it should use an effective communication medium, such as social media communication, e-mails, catalogs, direct mail, and text message to communicate the customers directly. Amazon should expand Brick and Mortar bookstore operations in Australia to compete with other e-commerce platforms or e-retailing stores in order to enhance the sales of the books (Dawson, 2015).          

Conclusion

From the above discussions and studies, it can be concluded that Amazon is the leading e-commerce or electronic retailing company in Australia that has been operating its businesses successfully in the Australian markets from the last couple of decades because of its effective marketing strategies. The firm can make appropriate changes in its marketing mix strategies in order to deal with the complex issues and challenges facing the firm, such as corporate social responsibility, ethical concerns, competitive trends, changing customers’ needs and preferences, technological advancements, globalization trends, and environmental protection issues. The extended marketing mix elements of Amazon including product development, pricing, distribution, promotion, partnerships, people, processes, and physical evidence were described and evaluating the performance of these marketing mix elements in meeting the future goals and long-term objectives of the company. Along with this, the appropriate recommendations were suggested for bringing improvement in the marketing mix elements for enhancing the environmental, corporate, social performance and global brand positioning of Amazon in the Australian marketplace.

References

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