ABSTRACT:

Indian retail industry has emerged as one of the most dynamic and fast-paced industries with an expected
reach of US$ 1.1 trillion by 2020 due to the entry of several local and foreign players trying to hold the
maximum market share. Among number of key players like Amazon, Flipkart, Myntra, Indiamart, Snapdeal,
etc… Amazon, is said to have an audience reach of 89 percent in India, according to Statista.

The report is based on Amazon India which is a fully-owned subsidiary Amazon. Inc., an
American multinational technology company based in Seattle, Washington, considered as one of the Big
Five companies in the U.S. information technology industry, along with Google, Apple, Microsoft,
and Facebook. Amazon launches its marketplace in India in 2012 after 17 years of its existence.

This report consists of number of objectives and the study is done using several secondary data in order to
understand and learn how Amazon is performing in India and their investment strategies in order to
dominate the Indian Ecommerce market. This report also discusses on problems faced by Amazon due to the
Covid-19 and the opportunities created during the pandemic.
 INDEX

S.NO TABLE OF CONTENT PAGE NUMBER

CHAPTER Ⅰ INTRODUCTION 1

1.1 INDUSTRY PROFILE 1

1.2 COMPANY PROFILE 2

1.3 SWOT ANALYSIS 4

1.4 VISION AND MISSION STATEMENT 5

CHAPTER Ⅱ LEARNING OBJECTIVES 6

CHAPTER Ⅲ INTERNSHIP DISCUSSION 7

3.1 AMAZON’S BUSINESS MODEL 7

3.2 REVENUE MODEL 8

3.3 AMAZON INDIA 10

3.4 AMAZON’S INVESTMENTS IN INDIAN MARKET 11

3.5 REASONS FOR INVESTMENTS 14

CHAPTER Ⅳ COVID-19 IMPACT ON AMAZON 17

4.1 MEASURES TAKEN BY AMAZON 18

4.2 GROWTH OF AMAZON IN INDIA 21

4.3 PROBLEMS FACED BY AMAZON 22

4.4 RECOMMENDATIONS 25

CHAPTER Ⅴ CONCLUSION 26

REFERENCE 27
 CHAPTER Ⅰ

INTRODUCTION:

1.1 INDUSTRY PROFILE

Ecommerce, also known as electronic commerce: refers to the buying and selling of goods or services using
the internet, and the transfer of money and data to execute these transactions.

India is the 7th highest E-Retail in the world with 330 million buyers online. The exponential growth in
internet and online infrastructure in India, it was no surprise that the e-commerce market experienced a
similar boost. The revenue in the eCommerce market is projected to reach US$46,002m in 2020. Increasing
rates of internet penetration, along with an increasing share of the organized sector within retail markets
created the strong foundation that ecommerce needs. This was propelled by government policies that allow
100 percent foreign direct investment in B2B e-commerce. 2019 frameworks expect FDIs for e-commerce in
the marketplace model and ensured a level playing field for all companies. Not to mention, the worldwide
spread of the COVID-19 pandemic has disrupted how people buy products and services and how they
perceive e-commerce. Consumers have switched from shops, supermarkets, and shopping malls to online
portals for the purchase of products, ranging from basic commodities to branded goods.

Retail online had gained speed in the last decade. Despite online sales accounting for just three percent of all
retail in 2017, the digital commerce sphere was estimated to reach 330 million buyers online by 2020.
Smartphone use had also supported the transition to mobile shopping to a point where it was estimated that
every third Indian shops online using a smartphone. Amazon and Flipkart were the largest players in this
segment, battling neck and neck right from the time they have launched in India offering vast variety of
products.

Market Size

1
 1.2 COMPANY PROFILE:

Company Name:  Amazon

CEO:  Jeff Bezos

Year founded: 1994

Headquarter:  Seattle, Washington, USA

Type:  Public

Operates in More than 185 countries

Market Cap (Sept 2020):  $1.65 Trillion

The company started as an online marketplace for books but expanded to sell electronics, software, video
games, apparel, furniture, food, toys, and jewellery. Amazon is known for its disruption of well-established
industries through technological innovation and mass scale. Amazon has its marketplace where third parties
can sell their products. It is the world's largest online marketplace, AI assistant provider, live-
streaming platform and cloud computing platform as measured by revenue and market capitalization.

2
AMAZON’S MAJOR ACQUISITIONS & INVESTED COMPANIES:

COMPETITORS:

Flipkart, Snapdeal, Myntra, eBay India, Jabong, Shop clues, Netflix, Hotstar, Swiggy, Zomato, Big Basket,
Paytm, Phonepe., etc.

INVESTORS:

The top individual insider shareholders of Amazon are Jeffrey Bezos, Andrew Jassy, and Jeffrey Blackburn

and

The top institutional shareholders are Advisor Group Inc., Vanguard Group Inc., and BlackRock Inc.

3
 1.3 SWOT ANALYSIS

STRENGTHS:

 Strong brand name

 Customer Oriented
 Differentiation and Innovation
 Largest Merchandise Selection
 Large number of third-party sellers
 Large number of acquisitions

WEAKNESSES:

 Easily imitable business model

 Product Flops and Failures 
 Losing Margins in Few Areas 
 Overdependence on distributors
 Declining consumer safety  
 Unfair use of third-party data 

OPPORTUNITIES:

 Expanding physical online stores

 Improve technological measures and Organizational policies 
 More acquisitions 
 Launch of electric rickshaws in India
 Untapped Indian market

THREATS:

 Government regulations 
 Few controversies 
 Cybercrime
 Aggressive competition 
 Fake Products 
 Economic Recession 

4
5
 1.4 MISSION & VISION STATEMENT OF AMAZON:

MISSION: “We strive to offer our customers the lowest possible prices, the best available selection, and
the utmost convenience.”

VISION: “To be Earth’s most customer-centric company, where customers can find and discover anything
they might want to buy online.”

AMAZON’S FUNDAMENTAL PRINCIPLES:

 Customer Obsession
 Ownership
 Earn Trust
 Invest and Simplify
 Learn & Be curious
 Insist on the Highest Standards
 Are right, A lot
 Dive Deep
 Frugality
 Bias for action
 Think Big
 Hire and develop the best
 Have Backbone; Disagree & Commit
 Deliver Results

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 CHAPTER Ⅱ

LEARNING OBJECTIVES:

 To do SWOT analysis on Amazon.

 To know about the business model of amazon.
 To have a in depth study on Amazon’s recent investment strategies in India.
 To analyse the reasons for their investments.
 How Covid-19 made an impact in Amazon India.
 To know what measures did Amazon make to overcome pandemic crises.
 To analyse Amazon India’s growth during Covid-19
 To find out the problems faced by Amazon in India.
 To discuss about the future plans and expansions of Amazon.


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 CHAPTER Ⅲ

3.1 AMAZON’S BUSINESS MODEL OF E-COMMERCE

What is the business model of Amazon that is being very successful?

Amazon has a diversified business model. In 2019 Amazon posted over $280 billion in revenues and over
$11.5 billion in net profits. Online stores contributed to over 50% of Amazon revenues, followed by Physical
Stores, Amazon AWS, Subscription Services, Third-party Seller Services, and advertising revenues.

Amazon runs a platform business model as a core model with several business units within. As part of their
current model in India, Amazon partners with small local businesses, described as “mom-and-pop stores”,
and sells their goods for a small commission. Amazon is an online marketplace where each day billions of
people find anything from the latest bestselling books to things like sleeping pillowcase.

The Amazon business model revolves around four main players:

1. Consumers: They serve consumers through their retail websites and focus on selection, price, and
convenience. Their websites enable hundreds of millions of unique products to be sold by Amazon
and by third parties across dozens of product categories. Customers access their websites directly and
through the mobile websites and apps. Amazon also manufacture and sell electronic devices,
including Kindle e-readers, Fire tablets, Fire TVs, and Echo, and develop and produce media content.
Amazon also provide easy-to-use functionality, fast and reliable fulfilment, and timely customer
service. In addition, it offers Amazon Prime, an annual membership program that includes unlimited
free shipping on tens of millions of items, access to unlimited instant streaming of thousands of
movies and TV episodes, and other benefits.

2. Sellers: Amazon offer programs that enable sellers to grow their businesses, sell their products on its
websites and their own branded websites, and fulfil orders through them. They are not the seller of
record in these transactions, thus Amazon earn fixed fees, a percentage of sales, per-unit activity fees,
interest, or some combination thereof, for their seller programs. Third party sellers represent more
than half of Amazon gross merchandise sales.

3. Developers and enterprise: Amazon serve developers and enterprises of all sizes, including start-
ups, government agencies, and academic institutions, through our AWS segment, which offers a
broad set of global compute, storage, database, and other service offerings.
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 4. Content creators: It also serves authors and independent publishers with Kindle Direct Publishing,
an online service that lets independent authors and publishers choose a 70% royalty option and make
their books available in the Kindle Store, along with Amazon’s own publishing arm, Amazon
Publishing. Many programs are also offered that allow authors, musicians, filmmakers, app
developers, and others to publish and sell content.

3.2 REVENUE MODEL:

If we look at the Amazon revenue model, a few things pop up right away. The online stores are still the core
part of the business. However, the core business is the foundation for other emerging businesses that run
with different logic to its online stores. Where online stores run at tight margins and high volume by taking
advantage of cash conversion cycles. Other parts of the Amazon business model contribute a lot to its
revenue.
1. Amazon Marketplace:
Amazon Marketplace is its primary business model and Amazon makes most of the revenue from this. In
this marketplace, merchants can sell their goods on this platform to direct customers.
Amazon charges some commission from merchants to use their platform on a per transaction basis.
Amazon offers two shipping options to its merchants: Amazon Easy ship and Self -shipment.

2. Amazon Prime Subscription:

The other revenue model of Amazon is Amazon prime subscription that is a recurring business model of
Amazon. In Amazon prime subscription Amazon gives customer free delivery to its customer and gives
access to its Amazon Prime video platform where users can watch web series and movies and also to
Amazon Music where users can listen to audio tracks. 

3. Amazon Kindle:
Amazon Kindle is an online book store where Amazon sells eBooks. Amazon is also a type of marketplace
where book publishers can publish their e-book and Amazon charges some commission from the publisher.
Amazon also sells subscriptions for Amazon Kindle.

4. Audible:
Audible is an Online store of audiobooks where people can listen to audiobooks of books, magazines, and
newspapers. Amazon also sells audiobooks and subscriptions to Audible.

9
5. Amazon gaming:
Amazon Gaming Studio is Amazon’s subsidiary that sells their games or third-party games. 

6. Amazon Patents:
Amazon also owns several patents that are used by many companies. Amazon earns royalty from these
patents. Amazon owns 1263 patents. 

7. Amazon Web Services:

Amazon Web Service is also known as AWS is a world-class IT infrastructure company that provides its
service to many renowned companies one of them is Netflix.

Above mentioned are the top source of revenue of Amazon. Amazon owns many other small companies and
has different business models like Amazon app Store and Zapoos.com etc. The revenue model of Amazon is
therefore dynamic. It has been repeatedly venturing into newer areas. Also, technology is the backbone of
these newer sources of revenue which many retailers had not thought about earlier.

10
 3.3 AMAZON INDIA:

Name:  Amazon India

Launched on 2013

Headquarter:  Hyderabad

Senior Vice President and Country Manage Amit Agarwal

Market share 31.2%

Employees:  1.5 lakhs +

Fulfilment centres More than 60

Offices 40

Delivery stations 1,400

Third party retailers sell their goods through Amazon's site using a "marketplace" model, a familiar retail
concept in India. Sellers send their goods to Amazon's warehouse near Mumbai. When an order is placed,
Amazon packs and sends the order to the customer. The company offered an online marketplace for both
buyers and sellers and Amazon charged a referral fee, monthly subscription charges and stores fee from
retailers that choose its services.

"We are excited to give customers in India a single online starting point where they can shop a wide
selection of products sold by local and global retailers, and make informed purchasing decisions,"
Amazon.com vice-president Amit Agarwal said to BBC News in 2012.

Now, Amazon India currently offers millions of products on its platform and has millions of registered users.
Amazon India currently offers products across various categories such as mobile phones, computers and
accessories, men’s and women’s fashion, books, sports & fitness, electrical & electronic items, movies,
music, cars, motorbike, baby products, toys, grocery items, etc. Amazon India also operates a Global Store,
where customers can buy directly from sellers in the United States. Amazon Prime, provides users access to

11
various services such as streaming video, music, e-books, the latest offers, etc. Amazon India currently
delivers to most of the serviceable PIN codes in India.

12
 3.4 INVESTMENTS IN INDIA:

With the increasing number of opportunities in India Amazon aimed to conquer the next “trillion-dollar
market.” Amazon has a growing presence in India. The e-commerce giant has invested billions into the
South Asian nation.

 After its launch in 2013, Amazon’s marketplace (www.amazon.in) had a very good growth in the market
and to become the India’s largest store, Amazon made a huge investment of US $2 billion in July 2014
to support its rapid growth and continue to enhance the customer and seller experience in India.

"After our first year in business, the response from customers and small and medium-sized businesses in
India has far surpassed our expectations," said Jeff Bezos, founder and CEO of Amazon.com. With this
additional investment of US $2 billion, our team can continue to think big, innovate, and raise the bar for
customers in India.

 To show a dominance in investment plans to the local players like Flipkart and Snapdeal and to become
the market leader Amazon had pumped ₹ 3,676 crore into India from 2014-2015.

Amazon’s investments were deployed into four large areas:

 Offering deep discounts to counter local competitors;

 Advertising extensively to create awareness about the product and discount offering;
 Logistics to ensure prompt fulfilment of the orders;
 And of course, technology to ensure that customers get an awesome experience when engaging with
the brand.
 In 2016 $3 billion investment plan by Amazon comes just two months after the revised FDI policy –
India allowed 100 percent foreign direct investment (FDI) in the marketplace model of e-commerce.
When many Indian e-commerce companies were finding it difficult to raise money Amazon announced a
massive top-up for its India investment an additional $3 billion in India, mounting pressure on
homegrown rivals Flipkart and Snapdeal and putting on notice China’s Alibaba which looks poised to be
a major rival in one of the world’s most lucrative retail battlegrounds. The company invested Rs 13.8
billion into Amazon data services.

“We’ve seen tremendous growth since our launch three years ago. “We’ve always maintained that India is
a key geography for Amazon and we will continue to invest very aggressively and over a long term." said
Amazon India country head Amit Agarwal.

 In 2017 Seattle-based online retail major Amazon had crossed $2 billion from its $5 billion investment
plan in India by making a total capital investment of Rs13,800 crore ($2.1billion) in its main local unit

13
 Amazon Seller Services. The infusion was made with a target of growing big in fashion and with a focus
on growing Prime membership for by keeping the user engaged. Ans also invested $515 million in multi-
brand ‘food-only’ retailing.

This investment was made after the rivals were backed up by large investments. Paytm with $2 billion by
SoftBank and Alibaba and Flipkart with $1.4 billion by Microsoft, eBay and China’s Tencent.

 With a commitment of $5 billion to the Indian market Amazon prepared to invest further, in Jun 2018 it
was ready to invest an additional $2 billion into its operations in India. This increased investment comes
as the company lost to Walmart in its bid for Indian e-commerce company Flipkart, with $12 billion as
opposed to the $16 billion Walmart offered, according to CNBC.

In Sep 2018, Amazon achieved its $5 billion investment target in India with a series of investments in the
five years that it had done business in India.

The investments were made in five entities:

 Amazon Seller Services Private. Ltd.

 Amazon Pay (India) Private. Ltd.
 Amazon Data Services India Private. Ltd.
 Amazon Internet Services Private. Ltd.
 Amazon Wholesale (India) Private. Ltd.

Amazon Seller services—which is Amazon India’s largest entity and marketplace arm—topped the
investment chart with $3.8 billion. The e-tailer also committed another $500 million to its food retail
business, Amazon Retail India Private. Ltd., into which it recently pumped in about $14 million.

 In Oct 2019, the company kept its investment momentum in FY19, with flagship programmes such as
prime and planned expansion of its warehousing and logistics arms sucking up major cash. Amazon
made a fresh round of investments in three of its India units, totalling Rs 4,472 crore.

In Dec 2019 Amazon invested over Rs 1,700 crore into its payments and wholesale business units in India.
14
 As Amazon India is the Amazon's most important market outside of the US and a key growth driver. Jeff
Bezos on Jan 2020 announced $1 billion (over Rs 7,000 crore) investment in India to help bring small
and medium businesses online and committed to exporting USD 10 billion worth of India-made goods
by 2025.

Amazon hopes that this investment will "bring millions of more people into the future prosperity of India
and at the same time expose the world to the 'Make in India' products that represent India's rich, diverse
culture."

The USD 1 billion investment would be to digitise 10 million micro, small, and medium enterprises
(MSMEs) and traders across India, including manufacturers, resellers, local offline shops, and brands. As
part of this effort, Amazon will establish 100 ‘Digital Haats’ in cities and villages throughout India.

Ahead of Jeff Bezos' visit to India the firm has pumped in a total investment of

 Rs 1,715 crore into its digital payments arm Amazon Pay (India) Private Ltd and Amazon Wholesale
(India) Private Ltd. (Jan 2020)

 Rs 2,500 crore into two of its Indian businesses, Amazon Seller Services and Amazon Data Services
India. (Feb 2020)

 When the Covid-19 pandemic has increased the demand for e-commerce services in the country. in
Rs 2,310 crore into its marketplace. The investment was made into Amazon Seller Services
(Amazon.in). (Jun 2020)

 Rs 1,125 crore into one of its India units, Amazon Seller Services, to compete aggressively against
Walmart-owned Flipkart and billionaire Mukesh Ambani-run Reliance Industries' JioMart in the
festive season. (Sep 2020)

In Nov 2020 Amazon committed to invest about $2.8 billion in Telangana to set up a new AWS Cloud
region in the southern state of India allowing Amazon to launch an AWS Cloud region in Hyderabad by
mid-2022, said K. T. Rama Rao, Minister for Information Technology, Electronics & Communications,
Municipal Administration and Urban Development and Industries & Commerce Departments, Government
of Telangana.

Amazon has increased the pace of its India investments in the last nine months alone as it has already
pumped $1 billion in its marketplace. Winning India will come at a price for Amazon. After Bezos presented
Amazon's Indian unit with a giant cheque for USD 2 billion in 2014 since then, Amazon has pledged a
further USD 3.5 billion to expand in the country and the USD 1 billion investment announced this year
would take the total committed investment to USD 6.5 billion for Amazon India.
15
 3.5 INVESTMENT REASONS:

The Indian e-commerce has seen a steady growth over the years from 2014 and is currently (2020) pegged at
US$46,002 million.

In 2013 India's e-commerce market grown at a staggering 88% to $16 billion from $2.5 billion in 2009,
riding on booming online retail trends and defying slower economic growth and spiralling inflation,
according to a survey by industry body Assocham.

"Having close to 10% of Internet penetration in India throws a very big opportunity for online retailers to
grow and expand as future of Internet seems very bright," said by the head of Assocham.

From that period on number of opportunities helped Amazon to become the most powerful E-commerce
company in India.

"The 21st century is going to be the Indian century," said Jeff Bezos. Despite huge losses, Amazon has been
pumping millions of dollars across various operations like marketplace, payments, infrastructure and supply
chain management as well as marketing and promotion as it looks to strengthen its position in the fledgling
Indian e-commerce market.

But why do a Seattle based company invest Billions in India within 7 years since 2013. Well, there are
certainly plenty of signs that Amazon is in the mood to invest in areas where it can grow.

 India is the world's second most populous country with 1.37 billion people and is expected to be 1.5
billion in 2050 surpassing China.
 India is the fastest-growing trillion-dollar economy in the world and the fifth-largest overall, with a
nominal GDP of $2.94 trillion with service sector contributing more than 60% to its economy.
 India has more than 50% of its population below the age of 25 and more than 65% below the age of
35. It is expected that, in 2022, the average age of an Indian will be 28 years.
 The number of smartphone users in India is expected to double to 859 million by 2022 from 468
million users in 2017 The country is one of the largest and fastest-growing markets for digital
consumers due to the availability of cheap smartphones.
 With over 560 million internet users, India is the second largest online market in the world, ranked
only behind China. It was estimated that by 2023, there would be over 650 million internet users in
the country. The majority of Indian internet users were between 20 and 29 years of age.
 The Indian E-commerce market is expected to grow to US$ 200 billion by 2026 from US$ 38.5
billion as of 2017. India is the 7th highest E-Retail in the world growing approximately 36% every

16
 year and it is currently in the “massification” stage of its e-retail journey. The number of online
shoppers in India is likely to increase from 100 Million in 2020 to 350 Million by 2025.
 India is expected to become the world's third-largest consumer economy, reaching Rs 27.95 lakh
crore (US$ 400 billion) in consumption by 2025.
 For international e-commerce players, India is a market primed for success. Cross-border spending
makes up the majority – 74 percent – of total e-commerce sales in India, as citizens seek out high-
quality foreign electronics and lifestyle products, in particular.
 India’s app store downloads grew by 165 percent between 2016 and 2018, and while entertainment is
behind much of this growth, shopping apps are also experiencing strong growth. In-app transactions
now account for 82.4 percent of all completed mobile commerce transactions.
 India’s e-commerce payments market, historically dominated by cash, but the use of cash in India is
set to decline to take just a 10 percent of the market by 2021. Evolving with cards and digital wallets
rising in prominence. Digital wallet use is expected to grow at a compound annual growth rate of 80
percent to 2021,43 at which point it will be the primary online payment method, taking a 34.8 percent
share of sales.
 Government e-Marketplace signed a Memorandum of Understanding (MoU) with Union Bank of
India to facilitate a cashless, paperless and transparent payment system for an array of services in
October 2019.
 Draft National E-Commerce Policy which encourages FDI in the marketplace model of E-commerce.
In order to increase the participation of foreign players in E-commerce, Indian Government hiked the
limit of FDI in E-commerce marketplace model to up to 100% (in B2B models).
 Heavy investment made by the Government in rolling out fiber network for 5G will help boost E-
commerce in India.
 In Union Budget of 2018–19, Government allocated Rs 8,000 crore (US$ 1.24 billion) to BharatNet
Project to provide broadband services to 150,000-gram panchayats.
 The increasing demand by the consumers for products, discounts and services, pushing Amazon to
pump in billions for innovation, development and expansion in India.

After losing out in China to Alibaba Group Holding Ltd, Amazon was desperate to succeed in the last big e-
commerce market in the world. Amazon sees India has a much more accessible market than China. That
mindset makes sense because Amazon struggled to become a big player in China, seeing declining market
share since 2008.

Amazon entered India at a time when almost every player is struggling to conserve cash and yet grow
business. Smaller players have had to shut shop, while even larger ones were realising that catching the
chimera of profit requires an almost endless source of funding.

17
Amazon after facing a huge loss in China it can’t do the same in India. Thus, Amazon entry in India was a
“do or die situation.” In 2013, India E-commerce market already had two players Flipkart and Snapdeal. To
have a neck-and-neck competition with its two local rivals in the race at the top of India’s e-commerce
market Amazon have to invest hell a lot of money.

After Amazon started emerging as the dominant e-commerce company in the country in the long run, the
local players also started to do their part showing Amazon they are still in the game.

Flipkart was backed by Microsoft, eBay and China’s Tencent and Walmart with $16 billion. Japan's
SoftBank investment of $627 million in Snapdeal. And other new players Swiggy and Zomato, Grofers and
Big Basket for grocery online, ticketing company BookMyShow and travel/hospitality companies Oyo and
MakeMyTrip stared growing.

After Reliance Industries (RIL) entering the e-commerce space in the grocery segment with its JioMart
initiative in tie-up with Facebook’s WhatsApp, expect more big players to enter the arena.

India is among the fastest growing markets for the e-commerce sector and the competition in the sector is
also set to intensify year on year. To cope with this fierce competition, investors are pumping in billions of
dollars into e-commerce companies to win and retain customers.

"The company is super excited about the opportunities in the region.” When we see a positive surprise, we
double-down on it - that's kind of our policy - and India is that kind of surprise," said Brian Olsavsky, CFO
of Amazon.com. These tremendous reasons made Amazon to invest huge numbers in Indian market.

18
 CHAPTER Ⅳ

COVID-19 IMPACT ON AMAZON

The novel coronavirus which causes a highly infectious disease Coronavirus disease (COVID-19) that has
infected more than 61.7 billion people worldwide. Since it spreads primarily through contact with an
infected person (when they cough or sneeze) or when a person touches a surface that has the virus on it, the
best way to guard against it is to stay at home. This has increased online shopping usage, globally. In India,
it has led to a rise in the number of FTUs or first-time-ecommerce-users in India, who had been so far
inhibited to shop online.

Amazon – one of the leading ecommerce players in the country, and the world, has announced on its site that
the customers are relying on them like never before in their social distancing and self-quarantine efforts.
Hence Amazon temporarily prioritised its available fulfilment and logistics capacity to serve essentials such
as household staples, packaged food, health care, hygiene, personal safety and other high priority products. It
also temporarily stopped taking orders for lower-priority products.

The initial phase of the lockdown, which was imposed on March 24, completely halted the operations for
online marketplaces as authorities closed warehouses and forced delivery fleets to stay at home. Things got a
little easier in the following days. However, since the government has restricted their operations just to
essential item, Amazon wasn’t yet able to sell large-ticket products online.

The government did show signs of giving e-commerce companies some relaxation in the month of May,
though the government u-turned and retained the earlier restrictions. However, both Amazon and Flipkart
urged the government to ease sales of non-essential items during the lockdown. The companies also agreed
to follow the Standard Operating Procedure (SOP) drafted by the government to ensure safe e-commerce
operations through their platforms.

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4.1 Measures taken by Amazon to support their employees, partners, customers, and
communities:

Amazon employees who can are asked to work from home, globally - In initial stage of international
COVID-19 developments, Amazon recommend that all global employees who work in a role that can be
done from home, can do so, through April 10. Employees and partners whose work requires their physical
presence in their workplace, have access to all of their usual paid and unpaid time-off benefits.

Supported employees affected by COVID with paid time off - All Amazon employees diagnosed with
COVID-19 or placed into quarantine received up to two weeks of pay. This additional pay while away from
work is to ensure employees have the time they need to return to good health without the worry of lost
income. This is in addition to unlimited unpaid time off for all hourly employees through the end of March.
They continue to work closely with authorities in India and worldwide to ensure that Amazon is taking the
right precautions and have implemented a series of preventative health measures for employees.

Amazon prioritized health and safety while fulfilling customer orders - Amazon's fulfilment, delivery,
and physical store networks play a critical role in serving customers. In these unprecedented times, it
remained committed to the health and safety of their employees, partners, and the customers.

Helping small and medium businesses through COVID-19 - With the nationwide lock down and
restrictions on movements of goods and people; customers started counting on Amazon like never before
and are increasingly recognising e-commerce to support their social distancing and self-quarantine efforts.
This is a challenging time for their seller partners and it impacts their business – especially the SMBs.
Amazon took several measures to help and support them navigate through this tough situation.

Local Shops on Amazon, a new beginning for offline retailers - Amazon anywhere in the world, used
their technology, training and enablement capabilities to power local shops across India to sell online. Over
the last 6 months, Amazon have been running a pilot with 5,000+ offline retailers and local shops to bring
the benefits of online selling closer to them. Code-named ‘Local Shops on Amazon’, this program helps
customers discover products from local shops in their city (many they already trust and love!) from the
convenience of their homes, while helping shopkeepers supplement their footfalls with a digital presence and
expand beyond their normal catchment.

Amazon Business delivers 100 million critical supplies to healthcare and government organizations at
cost - Throughout the COVID-19 pandemic, the demand for health and safety products has outpaced supply.
That’s why Amazon Business created COVID-19 Supplies, a program offering organizations with the most
urgent need—like hospitals and senior living facilities—critical products to fight the pandemic at cost. More
than 13,000 healthcare providers and 7,000 government organizations have used COVID-19 Supplies since
it launched around the world.

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Fillip to 6 lakh retailers and MSMEs on our marketplace - Amazon welcomes the latest notification from
the Government allowing e-commerce to deliver a wider selection of products. This will enable their 6 Lakh
retailers and MSMEs and help revive the economy.

Amazon Business introduces ‘COVID-19 Supplies Store’ - Amazon Business introduced the ‘COVID-19
Supplies Store’ to provide easy access for businesses to buy COVID related supplies on Amazon. Frontline
organizations such as healthcare and government can purchase COVID-19 related essentials in bulk from the
store to effectively fight the virus. The ‘COVID-19 Supplies Store’ has been specifically curated to provide
instant access to critical medical supplies and safety products. Customers need not spend time searching for
individual products. The store has a wide selection of items like N95 Masks, Surgical Masks, Sanitizers,
Personal Protective Equipment (PPE) Kits, Gloves, Shoe Covers, PPE Suits, Facial Shields, Infrared
Thermometers and we continue to add more.

Special Delivery Services in containment zones in Mumbai in collaboration with BMC - Amazon India
announced delivery services of essential items to residents in containment zones in Mumbai, in collaboration
with the Brihanmumbai Municipal Corporation (BMC). Following successful pilots over the last few weeks,
the company has scaled up the initiative to deliver essentials in many containment zones in the city. This
initiative will support residents in these zones who face restrictions in movement. Amazon will deliver these
orders to a designated delivery point in the vicinity of the containment zone, from where volunteers will
further deliver the packages to the customer’s doorstep.

Amazon Pay launches Amazon Pay Later - ‘Amazon Pay Later’, is a service that will extend a virtual line
of credit to eligible customers shopping on Amazon.in. With an easy digital sign-up process, customers will
get access to instant credit that they can use to buy any product ranging from daily essentials to electronics
and clothing items. Customers can also use this credit to complete their bill payments on Amazon.in.
Amazon Pay Later service offers the option to repay in the subsequent month at no additional fees, or in easy
EMIs up to 12 months at nominal interest rates.

Amazon India launches special fund to help SMB partners in logistics - Small and Medium Businesses
(SMB) across India have been financially impacted due to the nationwide lockdown in these unprecedented
times. In an effort to enable the SMBs in logistics that are heavily reliant on the company, Amazon India has
introduced a Partner Support Fund. This Fund for small and medium businesses in logistics will be available
to Delivery Service Partners (DSP) and select Transportation partners in India to help adjust their business
model to the new realities posed during the lockdown. Through the one-time disbursement, the fund will
support the partners in multiple ways. This includes enabling them to provide financial aid to close to 40,000
of their staff for the month of April’20. Additionally, it will help cover some critical fixed infrastructure
costs, and support liquidity and cash flow for these businesses as they resume and scale their operations post
lockdown.

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Amazon India strengthens partnership with Indian Railways for ease of freight movement - Amazon
India announced that it has strengthened its partnership with the Indian Railways to transport consignments
via rail across the country. The company is leveraging the ’COVID-19 Parcel Special Trains’ introduced by
the Indian Railways to ramp up its operations to 55 lanes during the lockdown period. This enhanced
network will enable sellers in Amazon India’s network to ship their products across the country and keep
their businesses running, thereby, allowing people to access a more diverse selection of essential products.

How amazon helped small business in India?

Amazon has over 600,000 sellers on its India marketplace. The company said its seller registration run rate
continues to be robust with thousands of new sellers registering on its platform. There are now more local
shops, retailers and brands looking towards e-commerce to jumpstart and scale their business. The firm said
it is seeing a 40 per cent increase in search queries from businesses looking to launch on Amazon and a
similar increase in new seller registrations versus pre-Covid-19. Over 90 per cent of its sellers are pre-Covid-
19 sellers which are actively selling on Amazon. These sellers have contributed to bringing back, 90 per cent
of Amazon’s pre-Covid-19 selection back on the marketplace.

Amazon's e-commerce transactions are exceeding the pre-Covid-19 daily sales volume, ever since the
lockdown was opened. There is a continued spike and haven't seen any reduction in that increased demand.

To address this demand, Amazon has rolled out Local Shops initiative that allows local shopkeepers to scale
up their reach with Amazon.in. Sellers will be able to use Hindi to register on Amazon.in marketplace and
manage their online business. The firm is seeing new sellers emerging from previously untapped
geographies like Darbhanga in Bihar, Barmer in Rajasthan and Mahoba in Uttar Pradesh. The other places
include Hailakandi in Assam and Bardhaman in West Bengal.

Amazon has also taken various steps to help its sellers navigate this challenging situation. As sellers jump-
started their business on the platform, the firm had set up an ‘on-demand disbursement’ feature that enables
sellers to get their disbursements daily. It has provided 50 per cent waiver on ‘Sell on Amazon’ fees for
small sellers to help them manage their working capital better. The company also waived off several other
fees related to fulfilment centre storage, business advisory and for start-up programmes.

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 4.2 AMAZON’S GROWTH IN INDIA:

In India, COVID-19 pandemic led to a rise in the number of FTUs or first-time-ecommerce-users in India,
who had been so far inhibited to shop online. Customers started relying on E-commerce companies like
never before in their social distancing and self-quarantine efforts.

 E-grocery has emerged as a sought-after space for online retailers during this pandemic. Amazon
India has expanded its grocery offering Amazon Fresh to Kolkata, Ahmedabad, Pune and Chennai as
the company expects grocery orders to spike up during this period, with more customers looking
online to fulfil their household needs. Amazon Fresh delivers fresh fruit and vegetables, dairy, meat
and other packaged food to customers in two hours.
 Audible Suno – an India-first app – that offers more than 100 audio stories and podcasts for free in
English and Hindi has launched 10 brand new shows on Audible Suno, which are also available at
free of cost. Over five million downloads in just nine months, with much of its growth coming during
the lockdown that triggered a rise in audio consumption across the board. Amazon, is now working
on adding more Indian languages to its 'Suno' service.
 In times of COVID-19, over-the-top (OTT) platforms became the most popular source of
entertainment for the GenZ’s and millennials of urban India. Amazon Prime witnessed 67% growth
in subscription. The new channels in Prime Video planned to bring live news, music, sports, award
shows and special events besides movies and TV show in the near future.
 Amazon India also hosted Prime Day on August 6-7, during which twice as many customers became
Prime members compared to the previous year. Prime enables one- to two-day deliveries and gives
users access to its video and audio streaming services.
 Amazon had a 60% -80% increased growth in new sellers in its platform. The local arm of the US-
based e-tailer now has more than 6.5 lakh merchants on its platform
 Around 91,000 small and medium businesses, artisans, weavers and women entrepreneurs across
5,900 pin codes achieved the highest ever day of sales during the Prime Day.
 New sign-ups to Kindle Unlimited increased significantly. The prolonged unavailability of physical
books due to covid-19 led lockdown has led to an uptake of e-books and audiobooks. Sale of e-books
have doubled from its low base and audio books have seen a big jump from a base lower than e-
books.
 The mass adoption of ecommerce and boom in online shopping have been the single biggest push for
digital payments during the Covid-19 pandemic. 10% of online payment in India is done through
Amazon Pay.

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As a whole Amazon clocked a profit of $345 million in its international business, helped by an increasing
number of people buying online.

4.3 PROBLEMS FACED BY AMAZON IN INDIA:

There were fewer than 1,000 active sellers left on Amazon India as of March 26 out of nearly 600,000
marketplace sellers on the platform after the company halted orders for nonessential items.

Amazon decided to spend $4 billion or more — the predicted operating profit for the company’s entire
coming quarter — just on COVID-19-related expenses. 

Amazon tried to tap into kirana stores with its grocery delivery app Prime Now to help with order fulfilment.
But due to a lack of adequate access to inventory, the project failed and Amazon India folded Prime Now
into its main services during the lockdown.

Amazon also needs to counter with counterfeit products on its platform. So, Amazon came with Project Zero
a global project which will ensure that customers receive authentic goods when shopping on the ecommerce
platform.

Amazon need to combat price gouging with zero tolerance and longstanding policies and systems to prevent
this harmful practice. Amazon is taking a number of important steps to keep prices fair and protect their
customers from those looking to exploit the current crisis.

 LEGAL ISSUES:

Amazon faces new antitrust challenge from Indian online sellers: Since 2015 The Confederation of All India
Traders (CAIT) has waged a battle against online retailers Amazon and other e-commerce companies
have faced mounting criticism from India's brick-and-mortar retailers, which accuse the U.S. giants of
violating Indian law by racking up billions of dollars of losses to fund deep discounts and discriminating
against small sellers. 

The new e-commerce rules, announced in late December, look to curb practices like steep discounts that
have helped Amazon dominate the US market and already make huge inroads in India. The rules state that
foreign online retailers can no longer strike deals with companies to offer products that are not available
elsewhere. That would strike at the heart of Amazon's business in India — the US company has snapped up
stakes in several local suppliers.

 CULTURAL ISSUES:

Amazon is facing repeated mis-judgments in India and it was forced into a hasty apology for selling a
doormat bearing the Indian flag. Then the company found itself in hot water over flip-flops carrying the

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image of iconic freedom fighter Mahatma Gandhi. may do sustained damage to its reputation in a market
where it needs to succeed. These mis-judgments may do sustained damage to its reputation in a market
where it needs to succeed.

Though Amazon is using Glocalization strategy in India still it is seen as an outsider to the people of India.
Amazon has been operating in India from 2013 and still it is facing lots of trust issues.

India is price sensitive country and it is no secret that Indians are guilty of being bumper festive shoppers.
Therefore, Amazon have to give heavy discounts for products in order to drive sales.

 FINANCIAL LOSSES:

We have seen how Amazon is investing billions into the India market, but if we see their balance sheet
Amazon is neither having a profit nor loss.

In 2015, Amazon Inc’s net loss for its India business widened to Rs 1,724 crore this was due to its higher
advertising, sales and promotion costs of almost Rs 1,405 crore. But Amazon Seller Services registered a
six-fold increase in sales to Rs 1,022 crore.

In 2106, After splurging heavily on marketing, discounts and investments in technology and infrastructure,
Amazon India reported revenue of Rs2,275 crore for the year ended March 2016 and the firm’s loss soared
to Rs3,572 crore.

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In FY2017-2018, The net loss deepened to ₹6,287 crore. However, the company’s total revenue grew by
54% to ₹5,018 crore. The firm attributed the losses to the investments in establishing infrastructure, opening
new fulfilment centres and technology advancement.

In FY2018-2019 Amazon Seller Services in India, has narrowed its loss to Rs 5,685 crore. Coupled with its
other entities in India, Amazon's losses were over Rs 7,000 crore and the revenue has jumped 55 per cent
during the period to Rs 7,778 crore during the period.

 NECK-TO-NECK COMPETITION:

Amazon and Flipkart have a neck-to-neck run right from the time they have launched in India. They have
distinct advantages and the truth is who offers the best to convince the palate of the Indian consumer is a
test. When Flipkart was backed by Walmart, the competition became much more intense.

Followed by Flipkart, Amazon has a list of competitors like Snapdeal, Myntra, Paytm, Phonepe, Swiggy,
Zomato, Netflix, Hotstar., etc. with billions investing in the market trying to capture a huge market share.

Amazon is facing the heat in India from new local player Reliance Retail, which has been rapidly expanding
its online and offline presence to take a bigger bite out of the country's retail space. Reliance Retail recently
announced that it is buying the retail and wholesale assets of Future Group in a deal worth $3.4 billion, a
move that would give access to the latter's 2,000 retail stores spread across 400 cities and towns. The
JioMart app has been installed more than 5 million times on the Alphabet's Google Play store as Reliance
has turned the heat on its rivals by enhancing the minimum discount from 5% to 7%.

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 4.4 RECOMMENDATIONS:

In short, Amazon needs to strengthen its key areas, minimize its weaknesses, avail opportunities, and
counteract threats for future progress.

1. Consolidate the market dominance by boosting its marketing efforts, promotional activities, and
competitive advantages.
2. Strategically deal with global controversies. Amazon needs to resolve tax issues and manage its
app’s features efficiently to diminish negative publicity in the market.
3. Increase its limited presence through opening more physical stores. This will augment brand
popularity and market reach.
4. Enhance its strategic entry in developing countries where many growth opportunities are available.
5. Increase competitive edges and enlarge the gap between Amazon and its biggest competitors.
6. Address the issues of counterfeit sales and cybercrimes by upgrading technology measures.
7. Enhance network security systems for the protection of consumers’ rights.

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 CHAPTER Ⅴ

CONCLUSION:

The internship enabled to learn about the company and its crisis management which was helpful to achieve
the learning objectives. The skills learned during the internship would be of used in the future.

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 REFERENCES:

WEBLIOGRAPHY:

 https://www.amazon.in/
 https://www.investopedia.com/insights/worlds-top-economies/
 https://www.business-standard.com/
 https://economictimes.indiatimes.com/
 https://www.financialexpress.com/
 https://timesofindia.indiatimes.com/
 https://www.livemint.com/
 https://www.forbes.com/
 www.ndtv.com
 www.quora.com
 www.marketing91.com
 www.thehindu.com

 https://inc42.com/features/amid-intense-scrutiny-and-competition-is-amazon-india-making-any-profit/
 https://analyticsindiamag.com/amazons-india-strategy-consolidating-empire-back-artificial-intelligence/
 https://en.wikipedia.org/wiki/Amazon_(company)
 https://www.firstpost.com/business/snapdeal-flipkart-and-more-a-look-at-investments-in-indian-e-
commerce-1994871.html
 https://timesofindia.indiatimes.com/business/india-business/amazon-india-sees-2x-prime-user-growth-
in-aug-sale/articleshow/78961684.cms
 https://inc42.com/buzz/after-reliance-amazon-scales-up-its-online-grocery-store-amazon-fresh/
 https://economictimes.indiatimes.com/tech/technology/amazon-says-its-diwali-sale-in-india-is-off-to-a-
good-start/articleshow/78945385.cms?
utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
 https://economictimes.indiatimes.com/tech/technology/amazon-says-its-diwali-sale-in-india-is-off-to-a-
good-start/articleshow/78945385.cms?
utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
 https://www.bloombergquint.com/business/amazons-nearly-done-investing-its-promised-5-billion-in-
india-as-walmart-challenge-looms

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