Company Background and History

In today’s competitive business environment, it is very important for the businesses to formulate and implement unique and effective strategies. It plays a vital role in fulfilling the changing needs and wants of customers towards products and services. To attain its business goals, it has to search out what the customers actually want and then recognize the most appropriate way to meet these demands (Chernev, 2018). For the organizations, it can be very difficult to gain competitive advantage over other players. Considering the changing demands of customers, Amazon is also implementing effective marketing strategies. Amazon.com is an America based organization that operates its business in e-commerce industry and it is a cloud computing firm that is based in Seattle, Washington and founded by Jeff Bezos in the year 1994 (Amazon.com, 2018). This report is focused on the marketing strategies which are used by Amazon Australia since it started its operations in the country. Moreover, there is the discussion about the marketing options for Amazon Australia the company wishes to stay competitive and successful throughout the next decade.

Amazon.com is an American organization that has its operations in e-commerce business and cloud computing that is headquartered in Seattle, Washington This Company was established by Jeff Bezos in the year 1994. E-commerce giant is one of the biggest internet retailers in terms of market capitalization and revenues. It is second largest as measured by sales after Alibaba Group. It has started its website as an online bookstore and after that it has differentiated its business in consumer electronics, video streaming and downloads, software, video games, furniture, apparel, jewelry, toys, food and audio book streaming and downloads. Additionally, Amazon also manufactures a variety of consumer electronics like Fire TV, Kindle e-readers, Fire Tablets and Echo. It is the largest provider of cloud computing and infrastructure services (Amazon.com, 2018). By using its e-commerce website, it is offering its products and services in various countries such as Australia, United States, United Kingdom, France, Ireland, Mexico, Japan, Spain etc.

Amazon Group has established its web based services in Australia in the year 2012 and after that it has opened a Kindle Store on its e-commerce base in Australian region. The company is fastest growing in this country and its current sales in the country are approximately $1 billion via international shipments. Now, it is making efforts to deliver in domestic market from Australia and it is focusing on domestic products. Amazon is the tenth top international retailer on the basis of revenue generation in the year 2015 (Forbes, 2017). Its deep pockets and huge size give Amazon competitive advantage in Australian market.

(Source: Wahlquist, 2017)

Other retailers in Australia may face challenges and difficulties competing with this level. Chinese e-commerce player Alibaba is looking for establishing itself in the location and it can give Amazon Australia a powerful competition. From its establishment in Australia, Amazon has formulated and implemented effective business and marketing strategies which enable it to attain its objectives and attain a great market position in Australian e-commerce industry (Pappas, 2016).

Marketing Analysis

In Australia, e-commerce market is very strong and it is growing very fast. Moreover, a strong economy and increased internet penetration is driving e-commerce growth. In the year 2017, the total sales of Australian e-commerce are $32 billion and it makes it one of the top 10 e-commerce markets internationally. Approximately 65% of population in this country purposely shops online and this data is increasing continuously. It makes this country an appealing market for Amazon with its variety of products and smart initiatives for long term retention of customers. If this company will be able to capture 20% market share in Australian e-commerce, then it will be producing approximately 6$ billion from this area (Westbrook and Kaye, 2018). In order to attain its business objectives, Amazon Australia has developed and implemented various business and marketing strategies. It has offered its services to the customers by keeping its worthy customers in the mind.

• The Nature of Amazon Australia’s Marketing Strategy or Strategies since it began.

The marketing strategies of the company are divided as per the marketing theories and frameworks. Marketing mix is one of the most significant frameworks that define the marketing strategies of a company (Scarborough, 2016). Since its beginning, Amazon Australia has divided its overall marketing strategies in different dimensions of marketing mix i.e. product, price, place and promotion strategy. These strategies are discussed below:

Product strategy is one of the most significant strategies on which Amazon has been focused when it has started its business in Australia. Before expanding its business in this country, it had operations in other nations like United States of America, China, Japan, India, Italy etc. In the year 2012, the company has introduced its web based services by using effective strategy. It has offered a wide range of products and services like retail products, consumer electronics, Amazon Prime, content development service, Amazon downloads, Amazon Web Services, Amazon Publishing, Video Direct etc. The company launched its products in this country considering the needs and demands of market and customers. It has adopted market place model that brought significant profits and revenues to Amazon. In addition to this, the company also began to sell gadgets such as Kindle, e-book reader and Fire Tablets. In 2013, it has introduced a Kindle Store on its website i.e. amazon.com.au and it has more than 1000 employees in the country. Thus, the company has started its business with the customer centric view and it has major focus on efficiency that has contributed to the success of Amazon immensely (Pappas, 2016).

Amazon Australia has started its business with the innovative delivery policies and competition based pricing strategy. As the company was offering different categories of products and services so prices of its products are also different. It provided the lowest prices and it was possible due to the efficiency of its business operations and its internet based business model. It has given the free delivery facility for the eligible products and services more than 49$ (Amate, 2017). The pricing strategy put the pressure on domestic online players like eBay and Kogan and on traditional retailers such as Myer, David Jones and Harvey Norman etc. Under this strategy, it has adjusted its prices on the basis of product, season and time of the day. Additionally, this company provided value added services such as Amazon Prime where customers pay charges and they can get the facility of one-day delivery and easy access to the products. This differential pricing strategy assisted Amazon Australia to attract a larger number of customers in the country (Adhikari, 2016).

Product Strategy

Place strategy is also a significant part of company’s marketing strategies in Australia. The company has provided its products and services through shopping website and application of Amazon. When a customer places the order, Amazon’s distribution channel comes into process where its products are stored and procure at its fulfillment stores. The company has established its warehouses in prime locations of Australia so that it can reach to all the places. Before starting its business in Australia, the company has made hard R&D efforts to under the needs and demands of customers. It allowed it to have a wide presence in different states of this country (Ottman, 2017).

Promotion strategy is the most important marketing strategy under marketing mix framework. When Amazon Australia began its business, it has made main focus on its marketing and promotional strategies. It used aggressive marketing campaigns to promote its brand in Australia. The company used different modes of advertising like print advertisements, creative TV commercials and social media marketing etc. Moreover, it has its own affiliate programs where the blog owners and website promote links of Amazon’s products at their platforms. Specifically, it is engaged in giving sales promotion and discounted offers in festive and holiday seasons. It has resulted a high visits to Amazon’s shopping website (Ryan, 2016). This strategy worked as one of the most effective marketing strategies of Amazon Australia.

Apart from above marketing strategies, Amazon Australia has used different strategies from Porter’s generic Model which enabled it to attain its marketing objectives and gain competitive advantage. Before expanding in Australian market, Amazon was already a leader in e-commerce sector. In order to prove itself as a highly competitive, Amazon has used cost leadership strategy in Australia so that it can attain more competitive edge over other players like eBay. For this, it has emphasized on minimizing it operational costs. The company has taken the advantages of process automation technique which is generally utilized to buy processing, scheduling and other activities. Due to this, it was able to offer its products on affordable prices and with discounted offers (Wicker et al, 2015). It has made huge investment in R&D process that allowed it to improve the performance of its IT resources. Thus, by using effective and efficient marketing strategies, Amazon Australia is able to meet its mission and vision statement and entice a larger population in the country.

• Strategic Marketing Options for Amazon Australia moving forward

There are various strategic marketing options for Amazon Australia if the company wishes to stay a successful company throughout the next decade. These marketing options can assist the organization to capture a large market share in the country (West, Ford and Ibrahim, 2015). Some of the strategic marketing options for Amazon Australia are discussed below:

Currently, Amazon Australia is operating its business through its web-based services which provides the customers convenience to shop their desired products. Now, company has option to expand its retail offerings in the country itself. In order to market its products, it can build a fulfillment center in major cities of Australia i.e. Melbourne, Brisbane and Sydney. This country has an appealing market for this company (Wahlquist, 2017). With this expansion, it will be able to approach a large and diversified customer range in Australia. There is a higher growth in e-commerce so Amazon will be able generate stable and incremental revenues. The shopping behavior of Australian customers is shifting from traditional to online retailing that will increase the revenues of this sector in 2018 as well. By establishing a new distribution warehouse outside of Melbourne, both the Australian buyers and sellers can be served better. It can reduce the delivery time for the products. It will attract more people towards Amazon’s retail services. Additionally, it can promote its Prime program that accounts for around 63% of all Amazon customers in America. These efforts will help the company to become successful in next decades (Applebaum, 2018).

Price Strategy

According to the JDA customer survey conducted in Australia, most of the respondents stated that they prefer to buy products online if they get discounts and good deals. Considering this, Amazon Australia can adopt this marketing option in the coming years. The survey indicates that customers mostly value the huge selection, lower prices and quick delivery of products. In Australia, the company can give different offers and incentives like “Money Off”, “Free Shipping”, “External Benefits” and “Giveaway”. It will help the organization to drive the sales of products. This is the most appropriate marketing option that is available to Amazon Australia as modern customers are very much interested in online shopping with discounted prices. It can promote the products through email, affiliate and social media sites. In 2018, the marketers of Amazon Australian can create and deliver an exclusive proposition which differentiates it from other local and international e-commerce retailers in Australia (Mermigas, 2011).

Guerrilla marketing is also a significant marketing option that is available for Amazon Australia. Guerrilla marketing is a promotion strategy which emphasizes on the low-cost unconventional marketing strategy that produces maximum outcomes for the company. To market its products among a larger population in Australia, Amazon can use this marketing option. By using this, this company can promote its products on the public places and streets with little amount of money. By doing this, the company will be able to get the attention of public. There are various companies in the industry which are using this strategy to entice a big audience (Murphy, 2017). Amazon can also use go with this marketing option to stay successful throughout next decade.

Conclusion

In the limelight of above analysis, it can be concluded that Amazon Australia is operating its business in Australian market. The above report states that company is using effective and efficient marketing strategies since it started its business. It has used different techniques for different strategies under marketing mix framework. These strategies have supported the company to attain competitive advantage against other players in the industry. The end part of report provides some marketing options which can help the company in its future growth and development.

References

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Ottman, J., (2017) The new rules of green marketing: Strategies, tools, and inspiration for sustainable branding. UK: Routledge.

Pappas, N., (2016). Marketing strategies, perceived risks, and consumer trust in online buying behaviour. Journal of Retailing and Consumer Services, 29, pp.92-103.

Ryan, D., (2016) Understanding digital marketing: marketing strategies for engaging the digital generation. UK: Kogan Page Publishers.

Scarborough, N.M., (2016) Essentials of entrepreneurship and small business management. Australia: Pearson.

Wahlquist, C. (2017) Amazon expands in Australia and plans huge warehouse, Available from https://www.theguardian.com/technology/2017/apr/20/amazon-expands-in-australia-and-plans-huge-warehouse [Accessed on 16 September 2018].

West, D.C., Ford, J. and Ibrahim, E., (2015) Strategic marketing: creating competitive advantage. Oxford University Press, USA.

Westbrook, T. and Kaye, B. (2018) In Australia, Amazon is still finding its way, Available from https://www.reuters.com/article/us-australia-amazon-com/in-australia-amazon-is-still-finding-its-way-idUSKBN1FP0FC [Accessed on 16 September 2018].

Wicker, P., Soebbing, B.P., Feiler, S. and Breuer, C., (2015) The effect of Porter’s generic strategies on organisational problems of non-profit sports clubs. European Journal for Sport and Society, 12(3), pp.281-307.