MARKETING MANAGENT-I

TERM PROJECT

Group no. 3:
Namrah Farooqi
(163030)
Komal Agarwal (163031)
Suvid Verma (163045)
Mohit Punetha (163036)
Nidhish Dogra (163013)
Kushal Singla (163032)
 INDEX

1. Introduction

2. Environmental Forces

3. Ansoff Matrix

4. PLC Strategies

5. Segmentation, Targeting and Positioning

INTRODUCTION
Amazon.com, Inc. is an American multinational technology company that focuses on e-commerce, cloud computing, digital
streaming, and artificial intelligence.
One of the most valuable brands in the world, it has been called "one of the most significant economic and cultural forces in the
globe." Along with Alphabet, Apple, Microsoft, and Meta, it is one of the Big Five American technological firms.
On July 5, 1994, Jeff Bezos launched Amazon from his garage in Bellevue, Washington. It started out as an online book store but
has since evolved into many different product categories, earning the nickname "The Everything Store."
It has numerous subsidiaries, including Kuiper Systems (satellite Internet), Amazon Lab126, Zoox (autonomous vehicles), and
Amazon Web Services (cloud computing) (computer hardware R&D). The company also has subsidiaries for Ring, Twitch,
IMDb, and Whole Foods. With the $13.4 billion purchase of Whole Foods in August 2017, it significantly expanded its physical
retail reach.

ECOLOGICAL FORCES

Political factors:

The growth of an organization in any given state or nation is influenced by the government, its policies, and its laws. It includes
labor law, foreign trade policy, tax rules and regulations, and corruption. These are all political elements in a PESTEL study.

• It examines the extent of the industry that is thriving in that specific area as well as government intervention.

• Support from the government for cybersecurity and efficient e-commerce, which benefits Amazon's operations. Additionally,
Amazon benefits from the political stability of wealthy nations.

Government support has contributed to the internet retail industry's rising popularity. However, Amazon may find itself at risk of
encountering fierce competition from major companies, especially in the expanding field of online commerce.

Ecological Factor:

Concern for environmental problems has increased as a result of issues like pollution and climate change. The ecological factor
looks at the company's prospects for success in light of its ecological sensitivity. Businesses that emphasize eco-friendly goods
and services, use renewable energy sources, and consider a sustainable future gain an advantage.

The PESTEL research reveals that Amazon has room for expansion when considering its ecological element. Its growing interest
in environmental initiatives, advocacy for corporate sustainability, and promotion of low-carbon living and waste management
techniques may improve its growth prospects.
Social Factors:

Understanding consumer behavior helps one comprehend the demand for and need for products. It is primarily influenced by the
sociocultural history of a location. Companies can evaluate the potential market with the aid of social elements like population,
education level, and cultural change.

Amazon relies on technology to take the place of workers. In terms of societal concerns, the company may be threatened by the
rate of declining employment prospects. On the other hand, the corporation will gain from the expanding popularity of internet
shopping and rising consumerism. Amazon is popular with young people and older individuals who worry about leaving home
because of the simplicity of product availability and doorstep delivery, among other factors.

Technological Factors:

Another important element in identifying the strengths and weaknesses of an organization is technological innovation.
Automation, technological innovation, change, and technical understanding are the elements that assist businesses in making
informed future plans. It helps them organize their manufacturing, transport, and distribution, as well as adapt new technology.
Amazon has had difficulties as a result of the expansion of its activities, including those from digital companies. The unique and
creative ways that Amazon engages with its customers are unmatched. They are constantly looking into innovative and efficient
shipping and delivery methods. They are simple to reach thanks to the live chat feature. Amazon intends to increase hiring in
order to enhance technology. They will be able to provide superior customer service as a result.

Economic Factors:

The revenue of the company is directly impacted by economic circumstances. It also covers costs for raw materials, financing
rates, and other factors. The corporation uses this component to estimate the purchasing power of customers and adjusts prices,
offerings, and services appropriately. It immediately affects how profitable the business is.

• The large variety that Amazon offers attracts customers even when they are not looking for something expensive, even though
Amazon has expanded its services globally with the help of government aid, taxes remain a constant challenge with their
constantly fluctuating number, especially in Asian countries. Economic stability provides Amazon with prospects for expansion
in developing nations.

Legal Factors:

Political and legal considerations both affect laws and regulations. To fully understand the dos and don'ts of operating in a
specific area, organizations must adhere to regulations governing their business, the health and safety of their personnel,
consumer legislation, and more.
• While extending its reach internationally, Amazon complies with laws and regulations. It emphasizes cybersecurity while
keeping consumers' security in mind. It has helped to boost the brand image to make efforts like making the environmental
protection rules more complicated. In addition, adjustments to import and export regulations will make it simpler for the business
to deal with challenges from rivals.

Ansoff Matrix
Amazon Ansoff Matrix is a marketing planning model that helps the e-commerce and cloud computing company to determine its
product and market strategy. Ansoff Matrix illustrates four different strategy options available for businesses. These are market
penetration, product development, market development and diversification.
Within the scope of Ansoff Matrix, Amazon uses all four growth strategies in an integrated manner:

1. Market penetration. Market penetration refers to selling existing products to existing markets. Amazon uses market
penetration strategy aggressively. Sophisticated user experience features in general and recommendations feature on e-retailer’s
website in particular play an important role in the application of market penetration strategy.

Specifically, Amazon focuses on user experience personalization thanks to efficient application of data science and machine
learning. The e-commerce giant collects and possesses a vast amount of data related to customers such as age, sex, lifestyle,
habits and preferences. The company uses artificial intelligence (AI) to analyse this data and suggest products that a particular
customer is highly likely to buy.

2. Product development. This involves developing new products to sell to existing markets. Product development is one of the
core strategies used by Amazon. Started by Jeff Bezos selling only physical books online in 1997, today Amazon sells anything
that can be sold online. The largest internet retailer in the world by revenue sells more than 500 million products, including
products sold by third parties on Amazon platform. Top product categories include clothing, shoes, jewellery, home and kitchen
appliances, books, electronic devices, sports and outdoor items and others. The e-commerce and cloud computing company
produces increasing number of products under the private label as well.

3. Market development. Market development strategy is associated with finding new markets for existing products. Amazon is
engaged in market development in a systematic manner. Started only in the US, Amazon currently has country-specific sites in
13 countries, including Canada, the United Kingdom, China and India. The largest internet retailer in the world by revenue is
expected to establish its presence in other countries as well.

4. Diversification. Diversification involves developing new products to sell to new markets and this is considered to be the
riskiest strategy. Amazon uses diversification strategy aggressively. As a result of diversification strategy, Amazon along with
online retail currently operates in media, software, hardware, advertising, logistics, B2B distribution and industries.

PLC (Product Life Cycle)

Introduction
When a product is relatively new to the market and you need to work on establishing it, this happens. Even though you should
normally steer out of brand-new products (unless you're inventing something, but that's a whole other discussion), if you stick to
the product rating of under 50,000, you should be fine.

In this case, creating a market for the product requires work. Even though it could be labor-intensive, the payoff might be well
worth it because you'll essentially be selling it alone, and supremacy can bring in sizable profits.

Growth
You've made a name for yourself by selling this item, but others have taken notice and begun supplying or selling it as well.
Additionally, your customers are becoming more aware of it, though not to the extent where the scales have tipped in their favor.
Demand is high, and there is typically little competition and little risk for a decent return.

Maturity
Now that the pendulum has swung the other way, a buyer's market has emerged. Since there are numerous variations of the
goods, you will have to cut your pricing and contend with more fierce competition. You must concentrate on the finer points of
selling, such as various features or styles, shipping benefits, and more, if you want to stand out from the competition.

Because of the increased saturation, the risk level associated with this product is currently at a medium level. Your return won't
be as high as it used to be due to the decreased demand for the goods, so you'll need to hone your talents in a more marketing-
oriented manner.

Decline
The situation has now fully turned around: customers are showing little interest in the goods, you've lowered your pricing as
much as you can, and you're generating fewer and fewer sales. This may occur with just about any product type and typically
happens when a newer, superior product like an iPhone or iPod enters the market.

If/when this occurs, your major objective should be to simply relocate the remaining inventory to avoid having to pay Amazon
for long-term storage.

The three characteristics of a successful Amazon product are:

 Product Reviews - A product's legitimacy increases with the number of evaluations it receives because more people
have used it. While choosing a product with many reviews will make your life easier, this does not necessarily mean
you should avoid those without many. That's because you won't have to put in as much effort to persuade folks to buy
it.
 Product Rating - Look for products that have at least a 3.5-star rating while sourcing goods. If you go below that, it will
be difficult to convince them of the product's quality. However, if you stay to 3.5 ratings and higher, you'll be off to a
flying start since the majority of customers won't be wondering whether they made the right choice.
 Product Ranking in Category - Look for products that have at least a 3.5-star rating while sourcing goods. If you go below that, it
will be difficult to convince them of the product's quality. However, if you stay to 3.5 ratings and higher, you'll be off to a flying
start since the majority of customers won't be wondering whether they made the right choice.

Segmenting, Targeting and Positioning

Analysis
Amazon divides its target market into manageable categories through market segmentation. Customers are divided by the
company based on their common interests and preferences. To give customers a list of goods and services, Amazon uses a multi-
segment positioning technique. Later, adaptive positioning is employed to keep track on market developments and modify the
marketing plan. Amazon uses anticipatory placement to foresee its consumers' purchasing patterns.

SEGMENTATION

Type of Segmentation Segmentation criteria Amazon target customer segment

Geographic Region More than 100 countries

Density Urban and rural

Age 14 and older

Gender Male and Females

Demographic Life cycle stage Young adults in the bachelor stage who are
not living at home

young newlywed couples without kids

Couple with one child younger than six

Couple with youngest child aged six or older

Older married couples with dependent

children

Older married couples without children living

with them

older married couples without children living

at home
Solitary survivor employed

Solitary Survivor Retired

students, workers, and professionals

Occupation

Behavioral Degree of loyalty Hard core loyal’

‘Soft core loyal’

‘Switchers’

Benefits sought Widest range of products

 Convenience of online purchasing

Competitive prices

Personality Easygoing, determined and ambitious

non-users, potential users, first-time users,

User status regular users, or ex-users of a product

Psychographic Social class All social classes: lower class, working class,
middle class and upper class

Resigned, Struggler, Mainstreamer, Aspirer,

Lifestyle Succeeder, Explorer

Reformer

TARGETING
As of 2022, Amazon's target market will be middle- and upper-class individuals (equally distributed between genders), with
average yearly incomes of $51k and possession of home computers or smart gadgets.
Anywhere with internet access might be considered part of Amazon's target market, although Americans make up 60% of that
market.

Amazon focuses on customers with basic technological skills, internet navigational knowledge, and access to financial tools like
credit cards, debit cards, UPI, etc.
People who prefer to shop online in order to save time and enjoy convenience, quick delivery, and affordable costs (and money)
are attracted to amazon.
As a result, Amazon customers typically lead busy lives and would prefer spend their time doing work or leisure activities than
shopping. The younger clients were drawn to Amazon's Prime programmed over the older clients.

POSITIONING
Amazon's positioning strategy serves a single objective: to set itself apart from the competition and gain an advantage over it in
consumers' minds.
Advertising is a highly valuable tool, and Amazon is creating a variety of ads to win over customers, particularly those who are
drawn to buying electronic items.
Amazon has also chosen the best distribution method, which will allow the business to gain a significant competitive advantage.
Affordably priced, high-quality items are also available through Amazon.

AMAZON