Introduction
Amazon is the brainchild of Jeff Bezos. It was founded in July 1994. Its headquarters are based in Seattle. The funding of the company was done by his friends and family. In the beginning, it was only an online Bookstore. Currently it sells a plethora of products ranging from cosmetics, tech gadgets, clothing and toys. Over the years, it has become a global enterprise. The company’s revenue touched $233 billion by 2018. Amazon only took twenty years to reach $100 billion revenue mark, faster than any other company. During the late 90’s it opened its offices in United Kingdom and Germany as well. The company’s journey from being simply an online bookstore to a renowned e-commerce website is an inspiration for others to follow. Back in those days, online shopping was a dream. Jeff Bezos presented a revolutionary idea and over the years, the company has seen exponential growth. Jeff Bezos, the current CEO of Amazon considered selling books online was appealing and easy to ship. The company owes it success to extensive research and development. Alexa, Prime Music, and Amazon GO are some of the greatest innovations that signifies the business growth (Welch, 2015). One of the trendiest things on the website these days is the Kindle. It is a cheap e book reader which will give access to almost a million e-books in the Amazon Kindle store.
The leadership of the company consists of Jeff Bezos who is the CEO and nine directors. They are involved in decision making to ensure the smooth flow of operations. New ideas are also pitched when required. They are further subdivided into chief finance officer, chief technology officer etc. There are three other offices in China Europe and India under international retails office to serve the local population of that areas. These locations are mostly chosen because of the consumer spending in these countries and the population. The management of the company ensures the smooth flow of operations.
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From a customer placing an order to the final point of delivery the product passes through various stages. Fulfillment centers is the beginning of processing. Tractors are used to carry the products and further moved by conveyor belts. The product is stored with millions of other things. It is then moved to an associate who picks it with robots. Afterwards, for packing, it is moved along the belt. Later on, the product is scanned by the computer and it is weighed to ensure that it is correct. After labelling, based on the location of the product, it is sent to a trailer.
Trailer trucks carry the products to sortation centers. Location and delivery speed are the criteria for distributing the products. The orders are then taken by different carriers like UPS, FedEx and DHL and delivered to the customers.
The company’s strategy is to value the customer. The website uses a strategy known as customer tracking. When the website is visited by the customer, cookies are saved which makes the shopping experience really user friendly. Recommendations are shown to the customer based on past purchases. Amazon also provides customer support. It is usually carried by emails or live chat. The customer representatives provide services in different languages which is its key asset. All the employees in the company have a clear understanding of the product and they know the knitty gritty of it. This way the customer satisfaction is maintained. The department of development has highly trained and skilled experts, Amazon has a clear idea of the demand of the suppliers. This gives it a competitive edge over other companies. With the boom of the fourth industrial revolution, more and more firms are finding their place in the e-commerce industry. Amazon outsmarts them by focusing on customer service innovation by using top of the line technology to improve customer experience and retain their loyal customers. Amazon uses the latest technology to keep up with rivals like eBay and Alibaba. It uses state of the art methods to maintain its dominance over its competitors in the e-commerce industry.
Linux is used to run Amazon. It consists of huge databases ranging to almost 24 terabytes. Hewlett Packard servers are used to power the warehouses. Netscape Secure Commerce Server is used by Amazon. This makes the credit card numbers secure because they are stored in a different database which restricts the internet access and the possible chance of hacking. Information like name, location and gender is also coded or encrypted. This gives confidence to the buyers as most of them are skeptical of buying things online because of possible chances of fraud or mishandling of personal information. Amazon makes sure that each and every customer’s data is protected.
In the present era, Amazon is the front runner in the e commerce industry. Amazon prime service was launched by it in 2005. The customers were guaranteed two-day shipping if they paid the annual membership fee. It has established its dominance in the online retail industry. When other companies followed this strategy, Amazon upped the ante by offering even a quicker service that is delivery received within one hour by Amazon prime now service. Prime delivery, one-day delivery, first-class delivery are the new features which are also now provided by the company. This way the preferences of different customers are met which sets apart amazon from other companies. Top notch information technology, superb warehouses and flawless transportation makes it the leading company today.
Amazon procured robotic warehouse solutions known as Kiva systems was procured by in 2012. Manual help is not required for the robots to pack up or pick anything. Currently, Amazon also manufactures Bluetooth speakers, batteries and many more. Portable storage units are used to store items. After that when the Kiva database system receives an order the closest robot is located by the software to get the item. Computerized bar code stickers are displayed on the floor which are followed by the robots to navigate around the warehouse. The robots also have built in sensors to avoid collision. Expanding its horizons further, Amazon has also set foot in the artificial Intelligence industry. It developed a product called Alexa. It is a virtual assistant technology like Siri and Cortana. It is able to perform tasks like streaming audiobooks or using itself as a home automation system. The A9 search engine is funded by Amazon and has all the capabilities ranging from pop up blocking to search history, bookmarks etc.
Lastly, Amazon has stepped up in other avenues beyond commerce. It has started a project known as Mechanical Turk. With this system, software developers can post tasks with which they need assistance like captioning of photos and or other small manual tasks. A person who completes the task gets a small amount of money and Amazon gets a commission when the transaction is completed. Other small tasks like data entry or designing a logo are also performed manually. The workers are usually called crowd workers or Turkers. The hours are set by the workers themselves because they are not under any obligation. Most of the workers earn around one dollar an hour.
What sets Amazon apart from other companies is its information technology system. The behavior of consumer is recorded, this way Amazon increased its sales by only making recommended products that were according to the preference of the customer. Furthermore, software engineers are continuously trained to improve the website and add innovative features to it. Though the company has its weakness. It is dependent on external contractors for the shipment of products. In this case, the company suffers millions of dollars per year and the profitability is reduced.
E-commerce has changed the dynamics of business. The usage of online shopping has increased rapidly in the past few years. As technology is experiencing changes every other year, there is always room for improvement. Developing countries are also aiming to improve their businesses by empowering enterprises to start e-commerce. With the advent of Artificial intelligence, huge amounts of data are collected about the customers. This allows the companies to know about the preferences of the customers. This in turn increases the profit and productivity of the stores as only recommended products are manufactured.
References
- Julia Layton. [ 2006, January 25]. How Amazon Works. Retrieved from https://money.howstuffworks.com/amazon3.htm
- Rick Leblanc. [2019, October 15]. How Amazon is Changing Supply Chain Management. Retrieved from https://www.thebalancesmb.com/how-amazon-is-changing-supply-chain-management-4155324
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