E-Business

Submitted To:-

Abdullah Al Fahad

School of Business & Economics (SOBE)

Submitted By:-

Name ID
Tanzin Binta Ahamed Arpa 111 161 139
Fairooz Khan 111 161 140
Shamara Zaman 111 153 033
Fatima Rahman Mou 111 161 063
SM Tasneem Al Arif 111 161 064

Section- D

Date of Submission: 16, September 2018

 Table of Contents
E-Commerce verification ........................................................................................................................ 5
Personalization .................................................................................................................................... 5
Customer Service ................................................................................................................................ 6
Prime Perks ......................................................................................................................................... 6
Review Cornucopia............................................................................................................................. 7
Innovation ........................................................................................................................................... 7
Ubiquity .............................................................................................................................................. 8
Global Reach....................................................................................................................................... 8
Universal standard .............................................................................................................................. 9
Richness .............................................................................................................................................. 9
Interactivity ......................................................................................................................................... 9
Information density ........................................................................................................................... 10
Personalization/ Customization ........................................................................................................ 10
Social Technology ............................................................................................................................ 11
Discover your friends' activities:................................................................................................... 11
Discover new products:................................................................................................................. 12
Share while reading: ..................................................................................................................... 12
Business Model of Amazon .................................................................................................................. 13
Amazon’s Revenue Model ................................................................................................................ 14
• Advertising revenue model ................................................................................................... 14
• Subscription revenue model .................................................................................................. 14
• Transaction fee revenue model ............................................................................................. 15
• Sales revenue model ............................................................................................................. 15
• Affiliate revenue model ........................................................................................................ 15
Value Proposition of Amazon ........................................................................................................... 17
The competitors of Amazon.............................................................................................................. 17
Alibaba .......................................................................................................................................... 18
Wal-Mart ....................................................................................................................................... 19
Otto ............................................................................................................................................... 19
JD .................................................................................................................................................. 20
 Priceline ........................................................................................................................................ 20
EBay.............................................................................................................................................. 21
Competitive advantages of Amazon ................................................................................................. 21
Target audience of Amazon .............................................................................................................. 22
Customer Database ........................................................................................................................... 24
Catalog database ............................................................................................................................... 24
Order Database.................................................................................................................................. 24
Pricing and Marketing........................................................................................................................... 25
Freemium .......................................................................................................................................... 26
Versioning ......................................................................................................................................... 27
Bundle pricing................................................................................................................................... 27
General bundle policy ....................................................................................................................... 28
Detailed bundle guidelines ................................................................................................................ 28
Bundle listing and categorization .................................................................................................. 28
Bundle warranties and returns....................................................................................................... 30
Bundle titles .................................................................................................................................. 30
Bundle product details and images ............................................................................................... 30
Auctions ............................................................................................................................................ 30
Selling Fees ....................................................................................................................................... 31
Selling Features................................................................................................................................. 31
Listing Options.................................................................................................................................. 32
Yield management ............................................................................................................................ 32
Flash marketing................................................................................................................................. 33
Social marketing ................................................................................................................................... 33
Facebook ....................................................................................................................................... 34
Twitter ........................................................................................................................................... 34
Pinterest......................................................................................................................................... 35
Mobile E-commerce and mobile marketing...................................................................................... 35
Broader reach .................................................................................................................................... 36
App marketing of Amazon................................................................................................................ 37
Conclusion ............................................................................................................................................ 40
 E-Commerce verification
Amazon.com, Inc. doing business as Amazon is an American electronic commerce and cloud
computing company based in Seattle, Washington, that was founded by Jeff Bezos on July 5,
1994. The tech giant is the largest Internet retailer in the world as measured by revenue and
market capitalization. Amazon has separate retail websites for the United States, the United
Kingdom and Ireland, France, Canada, Germany, Italy, Spain, Netherlands, Australia, Brazil,
Japan, China, India, and Mexico. In 2016, Dutch, Polish, and Turkish language versions of
the German Amazon website were also launched. Amazon also offers international shipping
of some of its products to certain other countries. Amazon fits into an E-commerce category.
Because:-

Personalization

From the moment a user visits Amazon.com, the e-commerce retailer works to personalize
their experience. Once a registered user, Amazon can move closer to having a one-to-one
conversation with a shopper by asking him or her to rate products in order to provide more
personalized product recommendations in the future. The company also monitors users
browsing and purchasing patterns to improve upon its recommended products. Plus, Amazon
puts an emphasis on personalization by using the majority of its homepage to feature
personalized, recommended products to its members.

Online retailers can compete with Amazon by also creating a personalized experience for
their customers. Monet ate, for instance, offers a product recommendation solution that
enables retailers to upsell with relevant and complementary products. The solution is
customizable, enables retailers to set rules for product recommendations, choose the location
that recommended products will be displayed on Web pages and more.
Customer Service

Amazon has a reputation of taking care of its customers. In fact, a 2013 Fore See study that
looked at customer experiences with the top 100 brands on the ’Net named Amazon the
winner, beating the likes of Nordstrom, Apple and Google. Moreover, the study shed light on
the value of satisfied customers, finding that highly satisfied customers are 60 percent more
likely to do business with the company again, 83 percent more likely to purchase more
products and 77 percent more likely to give the brand a positive recommendation. These stats
prove that customer service is a key driver to sustained success, and the retailers who take
care of customer issues and complaints in a timely and appropriate manner will see an impact
on their bottom line.

Prime Perks

Perhaps the biggest advantage Amazon has over other e-commerce retailers is its Amazon
Prime offering. Prime provides members with unlimited free two-day shipping on millions of
items on Amazon.com, as well as access to the company’s streaming service Amazon Instant
Video and the ability to borrow books from the Kindle Owners’ Landing Library. Prime has
been so successful that the service received more than 1 million customers in just one week
during the peak of 2013’s holiday shopping season.

While it is difficult for everyday retailers to compete with Amazon’s Prime offering,
merchants that sell on Amazon can use Fulfillment by Amazon (FBA) to store their products
in Amazon’s fulfillment centers. This makes their products eligible for Amazon Prime’s free
two-day shipping, which is more likely to entice consumers to make a conversion.
Conversely, retailers could work on developing their own, scaled-down version of Prime for
their store’s top customers. For example, an apparel retailer could offer a VIP membership
that customers could purchase to receive free two-day shipping on orders over $35, as well as
to receive exclusive discounts and promotions from the retailer.
Review Cornucopia

One of the main reasons consumer’s research products online is to look at ratings and reviews
from their peers, as the opinions of other consumers are highly trusted. Although the majority
of online retailers offer a ratings and review feature on their site nowadays, it is not
uncommon for this section to be empty or only feature a couple of reviews – just take a look
at the example from Best Buy below. On Amazon, however, the ratings and review section is
typically filled out by at least a few customers. Because of this, many shoppers will go
directly to Amazon to research and purchase products in one place. That said, retailers can
take steps to increase the engagement with their reviews, such as offering incentives or
sending friendly reminders via email to shoppers who made a recent purchase.

Innovation

Year after year, Amazon continues to innovate in the e-commerce space, with Amazon Prime
being just one example. In addition, Amazon has been implementing an offering called
Amazon Fresh on the West Coast, which provides free same-day and early morning delivery
on qualifying orders of fresh grocery items and local products. Furthermore, Amazon
partnered with the U.S. Postal Service to begin deliveries to Prime members on Sundays,
while the company's CEO Jeff Bezos also made headlines by announcing the company is
testing package delivery via drone, which could eventually allow Amazon to deliver
packages in 30 minutes or less.

Although these initiatives are difficult for online retailers to compete with, there are other
ways to attract attention to a digital storefront. For example, apparel retailers can implement a
virtual fitting room, like Fits. Me, to increase traffic, engagement and conversions on their
site, while other technology, such as Fluid’s product customizer, enables consumers to create
one-of-a-kind products directly from the product page.
Eight features of e-commerce followed by Amazon

Features of e-commerce Strongly Poorly

Ubiquity ✓
Global Reach ✓
Universal Standard ✓
Richness ✓
Interactivity ✓
Information Density ✓
Personalization and Customization ✓
Social Technology ✓

Ubiquity

Available just about everywhere, at all times, making it possible to shop from your desktop,
at home, at work, or even from your car. Amazon is characterized by its ubiquity, it is
available almost everywhere. Amazon provides E-Commerce solution to the customers and
gives their presence to everywhere through their websites (Qu et al. 2015). Customers can
purchase products without going anywhere to physical stores or out let of the company and
they can make purchase from their desktop only. Amazon offers product of many companies
and brand in a single platform which help them to reach to their prospects and customer can
also get their needs fulfilled. The ubiquity of Amazon lowers the cognitive energy that refers
to mental effort required to complete the task.

Global Reach

Permits commercial transactions to cross cultural and national boundaries far more
conveniently and cost-effectively than is true in traditional commerce Amazon allows
business transaction on the global boundaries more easily reachable and more effective with
respect to traditional business. The total number of customer Amazon can get depends on
their reach to the global market. Without going any outlet Amazon help other brand and
customer to reach a single platform to buy or and selling their product (Dorius and Alwin
2012). In contrast with traditional business, Amazon crossed national boundaries to global
customer.

Universal standard

Shared by all nations around the world, in contrast to most traditional commerce
technologies, which differ from one nation to the next-Commerce technology is an unusual
technology that makes Amazon to deliver same standard of product to everyone locally or
globally. Standard can greatly affect the market and also reduces the cost of delivery the
products to the customers. Amazon’s product remains same to their every customer and the
way they deliver that to the customer. Amazon is a E-Commerce giant, hence they maintain
their standard worldwide. They are doing well in terms of quality of their product as various
brand remains under same platform.

Richness

Enables an online merchant to deliver marketing messages in a way not possible with
traditional commerce technologies. Advertisement and promotional activity is important to
any business. Amazon can deliver the advertisement and promotional activity to the customer
through the internet very effectively. And that advertisement help to sell product to the mass
and that influence the customer to a great extent. One of the lacking is that the company and
business are not able to reach the target people physically. The traditional business enjoyed
the same but Amazon trying to reach mass by advertisements and offers they provide to
customers.

Interactivity

Allows for two-way communication between merchant and consumer and enables the
merchant to engage a consumer in ways similar to a face-to-face experience, but on a much
more massive, global scale. Amazon selling activity or mode of selling is two way
communications as both customer and seller can express themselves in a same platform as
well. Customers get what they want to purchase and seller sells what they manufacture to
satisfy the customers need and demand. Amazon tries to engage a consumer in a same way
similar to face-to-face experience in global scale. It is not possible to meet customers
physically if a company is dealing with E-Commerce Company so keeping in touch with
customers and making the transaction interactive is one of the features of Amazon.

Information density

It is the total amount and quality of information available to all market participants. The
Internet reduces information collection, storage, processing, and communication costs while
increasing the currency, accuracy, and timeliness of information. The density of information
affects the business that can be reduced through internet technology and reduces the
information collection and processing cost (Speyer 2015). But it also increases the accuracy
and information is more useful tool for the E-Commerce. Amazon reduces information search
regarding various brands, processing of same and the communication cost as a result it
increases the quality of search to fulfill the demand as required. Amazon can discover
customer’s interest, at the same time company can offer same product with a competitive
price to the cost sensitive customers. That helps Amazon to enhance their product in term of
quality, cost and brand.

Personalization/ Customization

The increase in information density allows merchants to target their marketing messages to
specific individuals and results in a level of personalization and customization unthinkable
with previously existing commerce technologies. According to Bharati and Chaudhury
(2015), Amazon customizes their website to reach people of various countries. They design
the website according to the conveniences of the locals of that country. E-Commerce
provides stronger customer relation through the personalized service as well. Personalized
and customized offering of Amazon also helps them to increase the customer satisfaction
level. This also permits Amazon to understand the consumer behavior through their past
purchase and company offers them product accordingly. Amazon personalize low priced
product of their customer but they lack in customizing high price products because the brands
of high quality deliver their customized product to customer.

Social Technology
Provides a many-to-many model of mass communications. Millions of users are able to
generate content consumed by millions of other users. The result is the formation of social
networks on a wide scale and the aggregation of large audiences on social network platforms.
By connecting your Facebook account to Amazon, you can now enjoy new features on
Amazon that give you a more social experience while you shop. You can always control your
connection preferences from the Social Settings page under Your Account. Below is a list of
features available now under social technology:-

Discover your friends' activities:

Discover when your friends have reviewed or wished for items you are browsing on
Amazon. Only items on your and your friends' public Wish Lists will be visible.
Update or create public or private Wish Lists here. Your and your friends' browsing
activities and purchases will remain private, and none of your Amazon activity will be
automatically posted on Facebook. Opt out of this feature by de-selecting the
checkbox on this page and clicking "Save".
Discover new products:
Discover movies, music, books and more based on your Facebook Likes. Experience
once you connect at Your Social Suggestions.

Share while reading:

Easily share notes and highlights from books you read with friends on Facebook.
 Business Model of Amazon

The largest online retailer in the world, Amazon operates under a business model with many
moving parts. First and foremost, the company sells goods directly. A percentage of products
are offered to buyers through Amazon's online storefront with a small markup, and inventory
is kept in the company's large network of
warehouses. Most consumers visit the
company's site assuming its products are
less expensive and readily available for
purchase and shipping.

In addition to direct sales, Amazon

provides a platform for other retailers to
sell products to buyers. Products sold
through Amazon's partner retailers are
often less common items or those with a
higher purchase price, allowing Amazon to avoid holding slow-moving inventory that could
dilute profit. While Amazon does not assess a fee for its retailer partners to list items for sale,
the company does retain a portion of the sales price as commission.

Amazon also maintains a subscription-based business model through its Amazon

Prime service as well as a small electronics product line. Under a Prime account, customers
pay an annual fee to secure free two-day or same-day shipping on eligible items and have
access to streaming media, such as digital music or movies. Amazon also generates revenue
from selling its e-reader, the Kindle, and the e-book and mobile application purchases offered
to kindle owners.
 Amazon’s Revenue Model

Revenue model describes how the firm will earn revenue, produce profits and produce a
superior return on invested capital.

There are many E-commerce revenue models that have been developed, Amazon follow
these revenue model.

• Advertising revenue model

Amazon advertising revenue up to $2.2b, up 129 percent. Amazon's ad business is
now worth almost $2.2 billion according to the company's second-quarter earnings, a
year-over-year increase of 129 percent. The revenue was, as always, in the “other”
line item, which are primarily sales of ad services.

• Subscription revenue model

The total number of Amazon Prime subscribers had been somewhat of a mystery
before Jeff Bezos revealed that the tech giant had crossed 100 million paid subscribers
globally. While it does not tell the exact number of subscribers, it gives a ballpark
figure to help estimate the historic subscriber count, which we use to forecast growth
potential. In this note we take a look at how we have arrived at our historic subscriber
count and our forecast for the total paying Prime members. We also forecast the
average annual Prime subscription fee to finally arrive at the total revenues that
standalone Prime subscriptions can add to Amazon’s top line through 2020.
Forecast the total number of paying Prime subscribers to increase to 164 million by
2020, while the average annual Prime subscription fees are expected to increase from
around $97 in 2017 to nearly $110 by 2020. As a result, standalone Prime
subscriptions could add around $18 billion to Amazon’s top line by 2020.
• Transaction fee revenue model

Amazon provides an auction marketplace and receives a small transaction fee from a
seller if the seller is successful in selling the item.

• Sales revenue model

Companies derive revenue by selling goods, content or services to customers.
Companies such as- Amazon (which sells books, music & other products).

• Affiliate revenue model

Amazon Associates is one of the first online affiliate marketing programs and was
launched in 1996. The Amazon Associates program has a more than 12 year track
record of developing solutions to help website owners, Web developers, and Amazon
 sellers make money by advertising millions of new and used products from
Amazon.com and its subsidiaries, such as Endless.com and SmallParts.com. When
website owners and bloggers who are Associates create links and customers click
through those links and buy products from Amazon, they earn referral fees. It’s free to
join and easy to use. Provide customers the convenience of referring them to a trusted
site where they can immediately purchase the products you advertise on your site.
And when they do, you can earn up to 10% in referral fees.
Entrepreneurs must ask themselves whether their business concept can be translated
into a viable, profitable business venture and how much cash it will take to achieve
that result.” There are 3 factors which I felt as effective for the revenue model of
Amazon.

Factors How does it affect the revenue model

Investment Amazon knows how much does it cost to launch sustain the business

Amazon has identified the cost components that have the greatest impact

on the cost structure, then disaggregated the cost data to uncover the key

Cost Drivers drivers

Amazon has identified the key revenue streams and the size and importance

of the different revenue resources, then disaggregated the revenue data to

Revenue Sources Uncover the key revenue drivers.

 Value Proposition of Amazon

Convenience, speed, and choice. These three core benefits make up Amazon's very unique
selling proposition.

They're located online, within a click, which is extremely convenient. Just type in what you're
looking for and read the reviews and description before adding it to your cart. Don't forget to
add to your wish list if you see something for next time.

They are fast. They have invested on warehouses and in developing a fulfillment program to
help entrepreneurs and small businesses ship even faster.

Moreover, they offer a huge amount of choice. Everything from books to barbecues. You can
find just about anything for sale on Amazon. In addition, it's the first place many search.
These benefits form a unique selling proposition that helped make Amazon a leader in
Internet commerce.

The competitors of Amazon

The following are the top Amazon Competitors and Amazon Competitors In E-commerce site
are:

1) Alibaba

2) Wal-Mart

3) Otto

4) JD

5) Priceline

6) EBay
7) Flipcart

8) Costco

9) Kroger

10) Home Depot

11) Walgreens

12) Target

13) Tesco

14) Netflix

15) ITunes

Alibaba

Alibaba a top e-commerce company, has its origin from China and it was founded in the year
1999. It is a platform for wholesale trade. Alibaba.com caters to many buyers and sellers
across the world.Alibaba.com have bought a change in businesses activities for its operations,
sales, and marketing. This top e-commerce company provides the services that are
technology enabled. It enables the merchants and other business to influence the usage of
internet to communicate and deal with their customers and users.

Alibaba.com is a one-stop platform which focuses on many products across various

categories that include electronics, clothing, machinery, home and garden and many more.
This top e-commerce company is accessible anytime and anywhere through the technology
platform that they provide to the users. Due to its core commerce and usage of technology
like cloud computing and digital media in the business, it is considered as Amazon
competitors.
Wal-Mart

Also regarded as a top competitor for

Amazon, Wal-Mart is like the normal Wal-
Mart store. Walmart.com provides a wide
range of products that are of supreme quality.
Apart from products they also provide
friendly service and have daily offers at low
prices.

Wal-Mart, headquartered in San Francisco in the year 2000 is a controlled by Wal-Mart

stores, Inc. The main goal of this top e-commerce company is to get their customers a unique
approach to shopping on the internet.

Walmart.com caters to many products across various categories. This company also provides
various kinds of the gift card which can be redeemed at Wal-Mart stores. The Wal-Mart gift
cards can be managed through their website itself. Due it its various unique features, Wal-
Mart is considered as one of the top Amazon competitors.

Otto

Otto, being rated as one of the successful e-commerce company in Europe, is well-known for
its innovation and has been reinventing itself since it has been originated. Otto is a trading
company that sells products of other brands through the internet.

Otto.de is a one-stop shopping for customers who can find the products and order them with
ease by making use of their technology friendly interface. It makes use of various digital tools
that make the customer navigate to their purchase. The customer can select the product and
place the product in the online shopping cart and then proceed for payment.
Otto provides products in categories like fashion, sports, electronics and home & living. They
provide the best products and offer a wide range of product categories to the shoppers. It is
estimated that Otto has generated around 80 percent of their revenues through online. Due to
its partnership with the external brands and its excellent services, Otto is considered as one of
the top Amazon competitors.

JD

Also regarded as a top competitor for Amazon, JD.com, it is also called as Jingdong and was
earlier called as 360buy. JD.com came into existence in the year 1998 and it is headquartered
in Beijing, China. It is famous for its B2C operations and its online store became visible to
the customer in the year 2004.Its official website is Joybuy.com. It provides a wide array of
Chinese products at a feasible price. It allows the customers to make use of their website to
select the product, place orders and the product gets delivered to their place.

In the year 2014, JD.com was listed in NASDAQ. It is a technology-oriented platform which
develops a scalable platform and provides proper services to their customers and partners.
Due to these features and popularity, JD.com is considered as one of the top Amazon
competitors.

Priceline

Priceline.com is a top e-commerce company based out in Connecticut, which is used for the
purpose of travel-related purchases like airline tickets and hotels bookings. It provides
services like hotel bookings, flight bookings and car rentals to the customers.

It also provides package bookings when customers combine hotel, flight, and car bookings
together. Priceline.com provides its customers discount coupons and various kinds of special
offers. Customers are encouraged with bonus points when the customer purchases for the
first time in form of rewards. Over the years priceline.com has also started their online store
that features about 10,000 products across various categories like cosmetics, skincare, baby
products, hair products etc.

Due to the wide range of hotels bookings and other online services provided by
Priceline.com, it is considered as one of the top Amazon competitors.
EBay

Also regarded as a top competitor for Amazon, eBay is yet another top e-commerce company
which is a multinational corporation. It is based in San Jose, California. It provides a user-
friendly website to its customer and mainly focuses on C2C and B2C e-commerce.

EBay is an online marketplace where customers and business people communicate to buy and
sell the products. It is the world’s largest shopping mall on the internet. EBay provides an
extensive range of products under various categories like fashion, electronics, furniture, home
appliances and many more.

EBay platform helps the sellers to conduct their online and offline business smoothly. Due to
the efficiency of being able to connect many buyers and sellers across the world, eBay is
considered as one of the top Amazon competitors.

Competitive advantages of Amazon

The company's primary competitive advantages are the low prices that it is able to offer, a
wide variety of products on offer ranging from digital media to grocery, and convenience of
shopping from home or mobile devices with a "same day delivery" option. It also has a cost
edge over brick and mortar retailers, since it does not have to manage physical stores.
The company has mobile shopping apps and has also ventured into making hardware, such as
the Kindle tablets, and plans to start making smartphones. The purpose of these hardware
products is primarily to support the sale of content that Amazon offers. This is one reason
why margins are kept very low for hardware, and relatively high for content. The prices for
Kindle tablets range from $79 to $379. Moving to making smartphones could prove to be a
good move for the company due to the rising trend of using mobile devices for shopping
(comparison shopping). An Amazon smartphone and new Kindle Fire devices could help in
driving sales of digital content higher, as well as building customer loyalty further; the entire
customer shopping experience (and usage too in case of music and eBooks) would then be
managed through Amazon products. The smartphone would face tough competition from
competitors like Apple's (AAPL) iPhone, which has raised the bar for customer expectations.

Target audience of Amazon

The website is certainly aimed at a wide audience who are interested in internet shopping.
The range of items for sale that Amazon offers would suggest that they wish to target
customers of all ages from young to the old. The site has been designed to ensure that it is
easy to use even for the most computers illiterate. The website is not really aimed at a “type”
of person as its offers items for people from all walks of life and interests.
 Data Flow Diagram

As shown, the simple data flow diagram of amazon website-

Customer
Email, Password, Information Customer
Two-step Database
https://www.amazon. HTTP request
com verification

Accept/Reject
visitor

Order Catalog
Product details,
shipped Database
price, availability
confirmed

Order
Add to cart,
Database
USPS/UPS.FedEx/DHL PayPal,
debit/credit card,
Fulfill Order
bill me later
Customer Database

Website customer- people from all around the country can find the website through the http
access which is https://www.amazon.com.

Verify login- people from all around the country can simply login into the website by
creating an id using email and at least 6digit passwords. Amazon also provides a two-step
verification system. Two-step verification is a process that involves two
authentication methods performed one after the other to verify that someone or something
requesting access is who or what they are declared to be. After you enter your sign-in
information in amazon, you may be prompted to enter a security code. You can receive this
security code in a variety of ways depending on the option you select during sign-up,
including text message, voice call, or authenticator app.

Catalog database

Catalog Display- After signing in amazon we can see varieties of catalog of different
products. Also we can see the details of each and every product are shown in the catalogs.
The price and availability of the product also included in the product details in the catalogs.

Order Database

Purchase product- after seeing the catalogs if someone wants to buy any products of their
favorites they can easily purchase that product by simply click on the add to cart option. By
doing this you can continue shopping and later you can go to your shopping cart information
and you will find the entire product you want to buy. Customers can buy products through
PayPal, debit/credit card or bill me later options.

Product shipping- Amazon Prime shipping packages are mostly shipped via UPS. In case of
destinations not served by UPS, alternate carries like FedEx/DHL are used.
If the estimated delivery date falls on a Saturday, then it is very likely that the package will
be shipped via FedEx as UPS doesn't deliver it on Saturdays.

Majority of the Free Super Saver shipping packages are shipped via USPS. In case if the
products are expensive or bulky then it gets shipped via UPS.

If the product you ordered is available in a nearby Amazon warehouse (usually within a 40-
50 mile radius), they partner with local courier companies such as A1 Courier Services in
Philadelphia and Delaware and On Trac in California.

Pricing and Marketing

Selling products online requires several different marketing strategies. One important point
that is often overlooked in online marketing is pricing strategy. While it may seem simple to
set a price for an item, several consumer psychology factors come into play. The price point
you set for your item may even determine how successfully it sells.

A business can use a variety of pricing strategies when selling a product or service. The price
can be set to maximize profitability for each unit sold or from the market overall.

Pricing is very competitive on Amazon.

The Amazon pricing strategy crushes the competition due to the number of adjustments and
speed in a single day. In 2013, Amazon had changed prices on about 40 million products in
just one day. By the end of that year the number had doubled to 80 million price changes
during a single day. How would competition keep up with this? With Amazon’s pricing
strategy, they fluctuate their prices at a rate that competitors such as Wal-Mart, Target, Best
Buy, and Toys R Us cannot battle. While Amazon can alter their prices by the thousands per
day, their counterparts only reach the hundreds range. This overload of price changes is one
that many people may not even notice, but it keeps Amazon ahead of the pack in more ways
than one.

Amazon is focused on keeping prices low and offering a wide selection. Due to the deals that
they have daily, they are able to achieve this with ease. Their customer base is loyal and
ultimately benefits resulting in Amazon benefiting as well. Amazon is viewed as innovative
and does not really focus on having competition. They set the bar and set the bar high enough
to excel above any brands that were deemed viable competitors. Amazon continuously take
over industries whether it’s electronics, book stores, apparel, or media. They have created a
system that at this point cannot be countered.

Amazon has two key secret weapons: convenience and being anticipatory. Amazon is quite
the rival with Wal-Mart as they both offer low prices and a vast product selection. The
proximity for most people to a Wal-Mart is around 10 miles. What sets Amazon apart from
the standard of low prices is that they cater to their customers. The goal is to make lives
easier. There are so many ways that they have implemented this by making shipping faster,
serving as an aide in entertainment with products like the Amazon Echo. There is even ways
to replenish products you need with Amazon Alexa Dash wand. The convenience of never
having to leave your house whether it’s for large or minor things will always work to
Amazon’s advantage.

Anticipating what’s next is a silent secret weapon Amazon has that competitors may or may
not notice. Their marketing strategy uses data that gives customers what they want.
Competition, in a way, is nonexistent. They are not following trends of what competitors are
doing. They take the hard trends that exist and create their own models and strategies.

Amazon is really a well-rounded mastermind with its private label brands and logistics.
While Amazon serves as a hub for other brands they have their own such as Amazon Basics
and Elements. They have hundreds of warehouses, branded trailers, and the latest expansion,
jets. Amazon understands their customers, what they want, and build around that. They do
not dwell on failed venture. In fact, they embrace failures, move on, and keep evolving.

There are 6 applicable pricing strategies discussed in the book. They are-

Freemium

A business model, especially on the Internet, whereby basic services are provided free of
charge while more advanced features must be paid for.
Freemium is a pricing strategy by which a product or service is provided free of charge, but
money is charged for additional features, services, or virtual or physical goods. "Freemium"
is a portmanteau of the words of "free" and "premium".

Amazon follows Freemium strategy in some context.

Amazon is reportedly working on a free, ad-supported version of its Prime video streaming
service, according to sources that spoke with AdAge. Currently, Prime members pay $99 to
access a variety of video streaming content, which is usually ad-free.

Versioning
Versioning a product gives the consumer the option of purchasing a higher valued model for
more money or a lower valued model for less money. In this way, the business is attempting
to attract higher prices based on the value a customer perceives. Examples:
Toyota Premio, Corolla, Allion, Cressida, Camry, Vist etc. I phone 4, 4s, 5 5s, 6, 6s 6sPlus
etc. Amazon sells so many types of products and brands. Amazon uses versioning highly.
All the electronic products, household products, devices, cell phones, computer parts are
versioned for different kind of customers.

Bundle pricing

In a bundle pricing, companies sell a package or set of goods or services for a lower price
than they would charge if the customer bought all of them separately.

Combining several products or services into a single comprehensive package for an all-
inclusive reduced price. Despite the fact that the items are sold for discounted prices, it can
increase profits because it promotes the purchase of more than one item.

Amazon uses bundle pricing. Amazon’s Detailed Bundle Guidelines explain that bundles
must consist of products that, when packaged together, enhance or ease the overall
customer experience.
Sellers can create bundles composed of different products to create a new bundled product.
Well-designed product bundles provide convenience and value to buyers. Adhering to the
policies on this page will help Amazon customers locate product bundles more easily and
prevent duplicate or near-duplicate listings.

Here is exactly how Amazon breaks down bundling:

General bundle policy

• You may not list bundled products where the primary product in the bundle is from the
Video Games category or is a Books, Music, Video, or DVD (BMVD) product.
• You may include BMVD and Video Games items as secondary products in a bundle if
they are related and complementary to the primary product in the bundle. For example,
you can list a bundle composed of a yoga mat (the primary product), a yoga DVD, and a
yoga book.
• The referral fee for the primary product's category (the same category used to list the
product) applies to the entire bundle.
• All products in bundles must comply with Amazon's selling policies. More specifically, all
products within bundles must adhere to the guidelines for each category.
• Bundle images, features, and descriptions must also adhere to Amazon listing policies.
• Failure to adhere to the Bundle Policy, including the following Detailed Bundle
Guidelines, may result in the removal without notice of any bundled product listing,
account suspension, or both. Amazon reserves the right to modify or revoke this policy at
any time.

Detailed bundle guidelines

Bundle listing and categorization

• Bundles must consist of items that are highly complementary (this means items in the
bundle enable or enhance the use of other items in the bundle or provide convenience to
the buyer by purchasing them together) .
• Bundles consist of multiple single items that can each be identified by a unique
ASIN/UPC and are sold together as a single offering. A pre-packaged kit or pack with
multiple items that is identified by a single ASIN/UPC is not considered a bundle.
• A bundle may be listed in a single category only, even if the products comprising the
bundle are from multiple categories. If a bundle includes products from multiple
categories, it may be listed only in the category of the highest priced item in the bundle.
The only exception to this guideline is if the highest priced item is BMVD or Video
Games (because bundles may not be listed in these categories). In these cases, the bundle
should be listed in the category with the second highest prices item that is not BMVD or
Video Games.
• The bundle must have its own standard product identifier or manufacturer part number.
The identifier of any individual product in the bundle may not serve as the identifier for
the bundle. Using a UPC from any single product in the bundle to identify the entire
bundle may lead to immediate removal of the listing. You are responsible for obtaining a
UPC for each bundle you create.
• Do not include generic products in a bundle, as it may mislead customers into thinking the
generic product belongs to the same brand as one of the branded products in the bundle.
Generic products are identified as items with no brand whatsoever on the product or
packaging (not just widely unrecognized brands).
• A bundle can be composed of different branded items, however the bundle itself should be
branded according to the highest priced item in the bundle.
• If an item is a multi-pack, such as six pairs of socks, list it as a single product and not as a
bundle. See UPCs and Item Package Quantity for Multi-Packs.
• If an item is a variation of a parent product, list it as a variation within the parent product’s
family and not as a bundle. See creating parent-child variation relationships.
• If you match your bundle to an existing bundle listing, the products in your bundle must be
exactly the same as the products in the existing bundle in every respect. If your bundle is
different in any way, you must create a new bundle listing. You may not change the
existing listing to align to the specifications of your new bundle.
• Once you create a bundle, you may not modify the components of that bundle. If you want
to add or remove products from the bundle, you must create a new bundle listing with a
unique UPC or match to an existing bundle listing that is identical to your revised bundle.
Bundle warranties and returns

• If you list a product bundle, you must accept the entire bundle as a return and refund it as a
single unit.
• A bundle cannot contain any separate warranty products or extended service plans.

Bundle titles
• Bundle title length should align to title length rules in Amazon’s listing policy. This policy
allows listings with a title length of maximum 200 characters (including spaces) in all U.S.
categories.
• Include the word "Bundle" and the number of items in the bundle in the product title. For
example:
Bundle – 3 items: Tote Bag, Knit Scarf and Gloves – Blue.

Bundle product details and images

• Feature Bullet 1 in the detail page for your bundle must state that the product is a bundle
of "X" number of items and must identify the products in the bundle.
• The description in the detail page for your bundle must state that the product is a bundle
and must also identify the products in the bundle (with appropriate designators, such as
model number, color, and size).
• The main image for the bundle must include the specific products in the bundle (and must
not include any items that are excluded from the bundle). Images of representative or
similar products are not permitted.

Auctions

An auction is a process of buying and selling goods or services by offering them up for bid,
taking bids, and then selling the item to the highest bidder. The open ascending
price auction is arguably the most common form of auction in use today.
Amazon.com Inc. allows customers to bid for lower prices on more than 150,000 items,
including fine art and rare coins, sold by third-party vendors.

Amazon does not allow you to cross promote additional items you are selling from your
details pages. However, they do include a “cross link” feature withAmazon.com. This feature
lets you promote your auction item with new books, music or DVDs located
on Amazon.com.

Amazon has a great reputation selling books, music and other entertainment products. When
you buy or sell with Amazon’s auctions, you are guaranteed the safety and satisfaction that
all Amazon’s services offer.

Amazon has a good auction service; however, they lack some additional user features offered
by the higher ranked auction websites like opening a store or adding to an item’s description.
In addition, navigating through the category layout is time consuming and many products are
missing pictures.

Selling Fees
Amazon has an excellent buying system that presents useful information about each auction
item including the seller, when the auction started, where the item is located, the number of
bids and payment options. One disappointing feature associated with Amazon auctions is the
deadline countdown clock. You have to refresh the page every few moments for the clock to
reflect real time.

Selling Features
All the basic features a seller would need to have a successful sale are available through
Amazon’s auction service. However, they do not have some of the fancier features like cross
promotion, extra picture options or customizable listing layouts offered by our higher raked
services like eBay.

Amazon charges 10 cents to list each item and you can relist once for free. Amazon also
charges 25 cents plus 5 percent of the final sale, including shipping and handling, for all
items sold. There is also the Pro Merchant Subscription for $39.99 a month for sellers that
often list many products.

Amazon does not allow you to cross promote additional items you are selling from your
details pages. However, they do include a “cross link” feature with Amazon.com. This
feature lets you promote your auction item with new books, music or DVDs located on
Amazon.com. For example, you can cross link your “The Lion King Board Game” on
Amazon.com’s “The Lion King” DVD page.

Listing Options
Amazon has several feedback and account management options. They encourage feedback
and recommend that all buyers check seller feedback prior to bidding. Through your account,
you can manage all the items you’ve sold, bid on and won. However, you cannot save
favorite categories, sellers or searches.

Amazon is one of the most easily recognized names on the internet, and has a loyal
following. However, they are still cutting their teeth in the online auction business and could
be a major contender if they reorganized their layout, included more item photos and user
options.

Yield management
Yield management is a variable pricing strategy, based on understanding, anticipating and
influencing consumer behavior in order to maximize revenue or profits from a fixed, time-
limited resource (such as airline seats, hotel room reservations or advertising inventory).

Amazon sometimes arranges clearance sale in order to sell the last few stocks. To sell the
excess capacity, the price is comparatively low.
Flash marketing

A flash sale is a discount or promotion offered by an ecommerce store for a short period of
time. The quantity is limited, which often means the discounts are higher or more significant
than run-of-the-mill promotions. The time limit and limited availability entice consumers to
buy on the spot - aka impulse buying.

Amazon uses flash marketing strategy. Amazon has flash sale or prime sale day. On which
primer membership holders can shop in a much discounted rate for a very short period.

Social marketing

Social marketing consists of two factors “conversations” and “engagement.” Your brand is
being talked about on the Web and social media is the conversation part. and the
measurement of engagement is the amount of time users spend on a site.

The social marketing concept holds that the

organization's task is to determine the needs,
wants, and interests of a target market and to
deliver the desired satisfactions more effectively
and efficiently than competitors are in a way
that preserves or enhances the wellbeing of both
the individual consumer and society.

Amazon strongly promotes conversation and

engagement.

There really is no digital retail success story

greater than Amazon's. The figures lay it down
bare. There are 310 million active Amazon
customer accounts worldwide, 90 million of which are Amazon Prime members who spend
an average of $1,300 per year on the platform, with the remaining 220 million non-Prime
members spending an average of $700.

Amazon is the crazy popular online shopping website that has somehow landed into every
aspect of our lives. How did it do this? Well, it has great control over its social media and it
knows the consumer who uses social media.

Facebook
Currently, Amazon has 23 million likes on its Facebook page. This is because it engages its
customers. It does this in several different ways. When it has somebody who has a question
or is expressing their frustration with the company it quickly responds with an answer or
some other dialogue to help that specific situation. It creates a conversation which is
important in social media.

Amazon also highlights products and offers coupons to encourage an increase in sales. Who
wouldn’t want a coupon to spend on that Mother’s Day gift especially when you were
planning on purchasing it online anyway?!

Twitter
If you have a Twitter account and you enjoy shopping through Amazon, be prepared for your
mind to be blown. If you see a product feature on Twitter and there is an Amazon code
included, there is a way for you to add that item to your Amazon cart immediately by
replying with #Amazon Cart. Genius!

Ok we understand that not everybody can come up with an idea like that, but being
innovative and trying to think out of the box with social media and knowing your customers
is important. Amazon currently has 108 million followers, why not create a way to connect
those followers straight to their accounts?

But what you can do is be creative with your tweets and create your own hash tag to
promote engagement through Twitter. Make sure that you inform your followers how to use
the hash tag in your tweets.
Pinterest
Pinterest is a great platform for Amazon because it sells stuff. It's able to share pictures of its
products without needing a large explanation for why people should buy the products.
Sometimes all people need is to see a product and in a blink of an eye that product is in their
shopping cart at Amazon.com. Keeping pictures vibrant and looking sensational is what
attracts people to those Amazon products on Pinterest.

Take a look at Amazon’s social media accounts and you can see why it has a large number of
followers and higher engagement. Making social media a priority is important to create a
kicking internet marketing strategy. Not every social media platform is right for every
business but there has to be a few social media platforms that can help promote your business
if you do it strategically.

Mobile E-commerce and mobile marketing

Amazon have mobile e-commerce presence. they have decided to take a step closer to mobile
e-commerce as they integrated m-commerce with their e-commerce business. Experts
consider this as a very serious move with a big play in mind, especially when a 53.9 % of all
retail e-commerce is expected to be generated via m-commerce by 2021. Besides, back in
2017 global mobile retail revenue amounted to 1.36 billion U.S. dollars, which is expected to
cross the 3.56 billion mark by 2021. This document shares valuable insights on how
important m-commerce is for your business and what impact it can create on your business
growth.
Amazon is giving mobile commerce in applications a big boost by making it easy for
marketers and developers to sell hard goods directly from within their mobile apps and
games.

App users will be able to shop for millions of physical Amazon products from within
Kindle Fire apps as well as apps for other Android devices using the ecommerce giant’s
one-click purchase experience and Amazon Prime shipping. The new Mobile Associates
API provides developers with a new way to monetize their apps and games in addition to
digital in-app purchases, subscriptions and mobile ads.

Broader reach
Amazon is already a significant player in mobile commerce, and this latest strategy will
only enhance that while leveraging its existing distribution network to drive in -app
purchases.

For developers, the move opens up new opportunities for how they monetize their apps
beyond advertising. While not many apps currently include mobile commerce
functionality, this could change as a result of Amazon’s move.

Amazon is a mobile commerce powerhouse that generates approximately $5 billion in

annual mobile commerce sales.
App marketing of Amazon

When customers want to do business on mobile, Amazon is there, with more than 70 million
mobile customers.

Amazon was one of the first brands to see the early potential of mobile commerce and is now
leading the way in terms of innovation and sales.

Its mobile site and apps have been a huge success and helped it to both maintain its
dominance of e-commerce and extend its market reach.

Part of Amazon’s success on mobile is obviously attributable to its reputation as a

trustworthy online retailer, but that doesn’t tell the full story. Other well-known brands
haven’t adapted to m-commerce with the same urgency or focus on user experience and are
now playing catch up.

Here are just some of Amazon’s IOS apps, for instance, with user counts.

Kindle Books 216,242,118

Amazon App Shopping 91,558,314

Amazon Music with Prime

Music 52,798,860
Music

Amazon Local Lifestyle 33,867,063

Amazon Video Entertainment 23,480,064

Amazon Photos Photo & Video 4,076,874

Amazon Fire TV Remote Utilities 2,638,521

Amazon Window-shop Lifestyle 2,209,077

MYHABIT Designer Brands Shopping 1,557,801

Price Check by Amazon Lifestyle 1,525,806

Amazon Alexa Music 632,790

Amazon Drive Productivity 615,015

Amazon Prime Now Shopping 560,268

Amazon Register Business 103,095

AWS Console Business 79,632

Amazon Student Lifestyle 62,568

Amazon Workspaces Business 34,839

Mobile enables not only an intimate, one-to-one brand-to-consumer relationship. It also

creates the ability to change strategies more quickly due to more accessible first-party real-
time data and analytics on what’s working and what is not working, what is hot and what is
passé. Both are particularly important in the fast-paced world of retail.
Of course, Amazon does many things right, especially technology, and its success is built on
culture, strategy, service, and other essential components. But crushing all competitors on
mobile with 4.4X more mobile customers than all of them combined sure helps too.
 Conclusion

Amazon's repertoire is a subsidiary company called Amazon Services. Through Amazon

Services, Amazon sells its sales platform, providing complete Amazon e-commerce packages
to companies looking to establish or revamp their e-commerce business. Amazon sets up
complete Web sites and technology backbones for other e-commerce companies using
Amazon software and technology. Target, for instance, in addition to having a store on
Amazon.com, also uses Amazon Services to build and manage its own e-commerce site,
Target.com. Through Amazon's Associate Program, anyone with a Web site can post a link to
Amazon.com and earn some money. The link can display a single product chosen by the
associate, or it can list several "best seller" products in a particular genre, in which case
Amazon updates the list automatically at preset intervals. The associate gets a cut of any sale
made directly through that link. The cut ranges from 4 percent to 7.5 percent .In my Opinion
there is no facility to sell private car, bike, in their web site so that they can include this one
to improve their site more attractive because this will be very helpful for all areas of people.

• This course introduces us to various topologies used within e-commerce, the

infrastructure required and security needed to make e-commerce possible.

• This Course showing us some effective video about e commerce so that we cannot
feel bored in the class

• This course will be of great interest to business professionals, as well as any learner
wanting to expand their knowledge and understanding of e-commerce.

• This course introduces the learner to various strategies used by firms and
organizations to attract and retain customers to their e-commerce, the different types
of attractors and attractiveness factors associated with attractors.
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https://www.websitemagazine.com/blog/5-reasons-amazon-wins-at-e-commerce

https://www.fastcompany.com/.../amazon-increases-global-reach-its-mobile-apps-almo...

https://myassignmenthelp.com/free.../features-of-e-commerce-company-amazoncom

https://sellercentral.amazon.com/gp/help/external/200442350?language=en-
US&ref=mpbc_200442390_cont_200442350

https://www.reuters.com/article/us-amazon-com-bidding/amazon-adds-bidding-option-to-
site-for-fine-art-collectables-idUSKBN0JN0N620141209