Amazon®: Competitive Business Strategy

Amazon®: Competitive Business Strategy

BIS 219

AMAZON®: COMPETITIVE BUSINESS STRATEGY

In today’s global economy, companies including Amazon® must embrace innovative technologies that replace old ones. Companies must however contemplate the requirements of running their current businesses with the need for new technologies. Companies often adopt innovation and diversification as strategies to keep up with a fast-changing market, but on the other hand, there are risks of diversifying too much. Amazon® seeks to diversify while remaining an effective competitor and staying true to their core competencies as an online retailer.

Maintaining Core Competencies

To meet the online retail industry evolution Amazon® worked diligently to synchronize its technology with distributors worldwide. Amazon® has become an international force of internet sales. Amazon® also experienced growth in electronics sales and products other than books, DVDs, and CDs. Despite this growth, Amazon® strategy remains unchanged. The company will not to move away from its core competency and give up its leading position in the industry; furthermore the company is revolutionizing the way people read textbooks and newspapers. Amazon® created Amazon® Kindle® with multiple applications for various operating systems. Amazon® also created an international version of Kindle that became available in many countries worldwide. The company also created Amazon® Movies on demand that allows customers to watch Amazon® video on demand on television through a broadband-connected device or computer. Amazon® diversifications are not risk free. “Over the last few days, Amazon® has shipped three major updates to its Kindle electronic-book system that expand its capabilities but also confuse its identity” (Pegoraro, 2010). Amazon® became engaged in a price war with the competition. Barnes and Noble, an Amazon® competitor, cut the price of its Nook e-reader by 23%, and forced Amazon® to...