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amazon

www.amazon.com. Amazon.com. Best known of the online bookstores www.amazon.com Has expanded to add music, video, toys and games, electronics, e-cards, and auctions Biggest competitor is Barnes and Noble at www.barnesandnoble.com. Success or Failure?. Approximately 3 million book titles

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amazon

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  1. www.amazon.com

  2. Amazon.com • Best known of the online bookstores • www.amazon.com • Has expanded to add music, video, toys and games, electronics, e-cards, and auctions • Biggest competitor is Barnes and Noble at www.barnesandnoble.com

  3. Success or Failure? • Approximately 3 million book titles • About 125,000 CD titles • Net sales for fiscal 1998 were up 313% from 1997, moving from $148M to $610M • Surpassed $1 billion in sales for its three years of existence • Stock price went through the roof

  4. Amazon.com vs. BarnesandNoble.com • amazon.com • share price 8/26/99: $ 132.87 • shares outstanding: 52.7 M • market cap: $ 7 B • barnesandnoble.com • share price 8/26/99: $ 18.31 • shares outstanding: 25 M • market cap: $ 458 M

  5. No Profit Yet! • Making an investment in the future • Must first build customer base • Allow consumers to get comfortable with purchasing online • Income comes from sales, ads, and partnerships

  6. Amazon.com Business Model • Short term goals • focus on customer comfort • create an online community for shopping • Long term goals • become a brand name • eventually lead to profit • How to accomplish these? • pursue four subgoals

  7. 1. Maximize Customer Comfort • Provide access to largest online collection of books • Allow for ordering, even when books are not in print or have not yet been released • Provide description of book • Permit customer feedback about books (reviews) • Show delivery time on any item purchased

  8. 1. Maximize Customer Comfort • Provide search engine for author, title, subject, and keyword • Short download time • Attractive (but busy) web page

  9. 2. Easy to Purchase • Among the first site to support sale by credit card • Give customer an overview of security features • Provide clear explanation of how to purchase • Five easy steps to purchase product • Sends email to buyer to confirm transaction

  10. 3. Customer Profiles • Keeps credit card info for customer • Records customer’s address and shipping info • Keeps a database of past purchases • Expedites future purchases • no need to reenter address/credit card • saves time and hassle

  11. 3. Customer Profile • Personalizes the shopping experience • greets returning customer by name • provides recommendation of new books based upon past purchases • Provides previews of new books • Allow customer to provide a review of books read • Does raise questions about data mining

  12. 4. Become a Brand Name • Use advertising • Offer commissions to other companies to help sales • American Online, Dell Computers • One of the first electronic commerce companies • Highly recognizable as a brand name

  13. Future • Jeff Bezos (CEO) says • focus on customer • build brand • expand product offerings • delay profits • How long can it last? • nobody knows

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