A review of the 7ps and Marketing mix of Amazon

   

Amazon was founded in 1994 by Jeffery P Bezos, who has since been serving as its chairman. However, the online business of Amazon opened in 1995. The company has come a long way from being an online bookseller to being the leading online retailer of the world. Today, it sells hundreds of millions of products, several of which is it's own and others sold by third-party sellers through its website. 

Amazon's main strength is its global presence, and that is demonstrated through Amazons marketing mix and the 7 P's. 

PRODUCT.

 The quality of products in Amazon is at the highest standard for their customers.  

Amazons products are also at a much higher quality than their competitors. Still, at a higher price, however, people are willing to pay more for a product that has a better chance of lasting or obtaining its original quality. 

Amazons products are also divided into 4 categories. 

1. Amazon's website - enables hundreds of millions of products to be sold by Amazon and third parties across dozens of product categories. 

  

2. Electronic devices - Such as Amazon's personally manufactured fire tablets, kindle, fire tv, headphones, mobile phones, and many more.

3. Media content - An extensive range of products and services, including cloud-based services that can be used to produce content. 

4. Amazon web services (AWS) - This segment offers a range of global compute, storage, database and other service offerings.

 Net sales from AWS jumped to 17.5 billion dollars in 2017, 43% growth over the previous year. Amazon has also grown the pace of innovation across its AWS platform in areas like machine learning and artificial intelligence, Internet of Things, and serverless computing. 

PLACE

Traditionally, Amazon did not have any physical stores and the company relied on online sales channels, due to the e-commerce nature of its business operations. 

    

As mentioned, not only did Amazon rely on online sales, but they also sell to wholesalers who then sell onto different retailers located all over the country.

 Amazon also partners up with numerous delivery service providers to provide timely deliveries. 

PRICE

Analysts note that - "Amazon's strategy is to frequently lower prices until they beat competitors for all products." 

With Amazon's pricing strategy, they fluctuate their prices at a rate that competitors such as Walmart, best buy or toys r us cannot battle. 

While Amazon can alter their prices by thousands per day, counterparts only reach by the hundreds range. 

Within the pricing strategy for Amazon, they also over a scheme called Amazon Prime. 

Amazon Prime is a paid subscription program from Amazon that gives users access to additional services otherwise unavailable or available at a premium to regular Amazon customers. Services include same, one or two-day delivery and streaming music and video. 

Amazon had an 'Amazon Prime Day and the strategy behind this was to offer so many deals that it would encourage more users to upgrade to the premium service. 

This helps to build a competitive advantage against their competitors and will help them gain market share in several different categories. 

PROMOTION.

Amazon's most effective strategy for marketing is through their promotional skills.

It is a fact that affiliates advertise Amazon products on their websites and blogs, and receive commissions usually per sale made, Amazon offers sales promotions and discounts regularly. It also uses public relations activities to promote its brand image. 

For example, the company has an affiliate program for website owners or online publishers to earn revenues by displaying advertisements and corresponding links to products sold on the Amazon.com website. This strategy widens the company’s market reach. 

Amazon communicates with its customers using a variety of tools and methods. 

Such as regular advertising through television adverts, radio adverts, billboard signs, newspapers and social media. 

Amazon says: “while costs associated with free shipping are not included in marketing expense, we view free shipping offers and Amazon Prime as useful worldwide marketing tools, and intend to continue offering them indefinitely. 

Amazon also pioneered ‘highly personalised product recommendation emails’ based on previous purchases, past product value, location, age and gender. 

This process is much more effective than sending spam emails that have nothing to offer for the customers because it isn’t what they want. 

Amazon is known for having a large marketing budget. In 2016 alone, they spent 7.6 billion on marketing. 

Moreover, in using direct marketing, the company directly communicates with businesses to offer their online services, such as publishing and digital content distribution. 

In this component of Amazon’s marketing, advertising is the primary determinant of the organisations marketing communications effectiveness. 

The effectiveness of Amazon's promotional strategy.

Amazon’s promotional strategy is successful because not only do they regularly promote their product or service very clearly but while doing this, they are having a bright understanding of what the customer wants. 

They want quality products, they want it at a reasonable price, and they want it delivered fast and within the excellent condition. Amazon has been able to uphold this promise, which is why Amazon is growing with such success. 

Amazon also believes that their most effective marketing communications are a consequence of their focus on continuously improving the customer experience. Which then creates a word-of-mouth promotion which is useful in acquiring new customers and may also encourage repeat customer visits.

PEOPLE.

Amazon's sales team plays vital roles in marketing efforts.

They are trained in using persuasive techniques, and they learn all about customer preferences. 

 

Amazon also has an on-call customer service, to assist with any issues with a product that a customer has purchased.

Amazon work with suppliers to obtain raw materials. This helps with maintaining and improving the quality of the final product.

PROCESS.

Below explains the process of how to purchase products from Amazon and a link to how the warehouse runs and how inventory is controlled, to ensure products are always available. 

In order to purchase online, they have a 5 step process.

1. Identify their client

2. Select shipping address and special options

3. Select the payment method

4. See an overview of the entire order

5. Confirm and place the order. 

Below is the link to how to warehouse functions: 

https://youtu.be/Y-lBvI6u_hw

PHYSICAL EVIDENCE.

Here is some physical evidence on how Amazon has mounted top of the ladder in their online sales against their competitors.

Amazon has an online website that is user-friendly and allows customers to view products in high-quality images taken from various angles. 

This is one factor on how it has helped Amazon make many sales due to its easy-to-navigate website because a wide range of people is able to use it.

  The simplest meaning behind the Amazon logo was created to represent a message that it sells everything from A to Z (the arrow connects the two letters.)

It also represents the smile that customers have when experiencing shopping with Amazon. 

IN CONCLUSION.

Amazon's strategy has proved successful at attracting and retaining customers in a very large number. Apart from customer service, its pricing strategy has also played a central role in making it as popular globally.

Its position as the leading e-commerce player has become a formidable challenge for the physical retail players. 

I believe Amazon has found success from using promotion as a way of marketing the company to the world, as they have used all channels in a development such as the use of paid advertisement, recommended emails, billboards and social media. They have used these tools to attract them to their website, convert them from a visitor, into a potential customer, and also close them as a customer, and then onto building a relationship with them through emails, without trying to upsell.