Part C Marketing Plan

MARKETING PLAN 1

Marketing Plan B

Thelmara Megginson

MKT/574

October 26, 2020

Roberto Ancis

MARKETING PLAN

Mission Statement

We strive to offer our customers the lowest possible prices, the best available selection, and

the utmost convenience.

Vision Statement

To be Earth’s most customer-centric company, where customers can find and discover

anything they might want to buy online.

Product line description

The company’s product line includes several media which includes books, DVDs, music

CDs, videotapes and Software, apparels, Amazon studio, Amazon prime, automotive item, health

and personal care items.

Company information, such as size of the company

It is an American multinational technology company which is based in Seattle,

Washington that focuses on e- commerce, cloud computing, artificial intelligence and digital

streaming. It is one of the most influential economic and cultural forces in the world.

Competitive Forces

Competitive forces that face this company comes from well-established competitors who

have lower prices compared to them. Other have a bargaining power of suppliers (moderate force).

The threat of substitutes and other substitution (strong force).

Economic Forces

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One of the most -major economic forces that faces Amazon is the international business

accounted for about 28% of Amazon consolidated revenues. It is evident that the business is

subjected to different kinds of currencies.

Cost of labor is indeed another important economic factor that in one way or the other

affects the e-commerce and cloud computing company.

Political Forces

1. The increasing governmental effort on cyber-security.

2. Governmental support for e-commerce.

3. The political stability that is developed by countries they already support in.

Legal, Regulatory, and Ethical Issues

One of the most legal and ethical issues that they have is through tax avoidance. Amazon

appears to have built-profit maximization through tax avoidance. Taxes are important and when

one is not paying them that becomes more of a legal and ethical issue one should sort himself for.

Technological Forces/AI-powered home robots

Amazon is working on a project that would really shake the market and make significant

breakthroughs in the online retailing segment. It is believed that the error of artificial intelligence

is just around the corner. Therefore, Amazon has artificial intelligence research and development

centers just to make sure when the AI shift comes, they are more than ready for it.

Social Forces

There are different conditions that includes wealth disparity and increasing consumerism.

Current Target Market

Amazon four targets 18 to 34 years old bracket of e-commerce consumers. Most of the

time the targeted consumers vary from categories of social buyers, addictive gamers buyers to even

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casual buyers (Opresnik, 2018, July). Their social class might be upper middle class or higher most

of the individuals who fall in this category are in the bracket of A and A1 category. These are the

potential buyers for the in the e-commerce world.

Review Current Marketing

When it comes to relationship marketing, as I have stated earlier, Amazon is the king. This

is because the company doesn't offer any product that is by any available means one can imagine.

However, it should be noted that Amazon is not the first company that entered into a sharing

economy bandwagon and create room sharing experience. It is evident that it did not even have the

first-mover advantage, yet it further and made a significant impact in the hotel industry. There

isn’t so much money current kept specifically for marketing but for sure the company has outdone

its competitors.

SWOTT Analysis

Strengths

The first strength of Amazon is the low-cost structure, selection merchandise that is huge,

and a large number of third-party vendors.

It is beyond doubt and evident that Amazon is the largest online retailer both in the U.S and in the

entire world (Opresnik, 2018, July). This is information is backed up in 2019 alone, the company

earned $141.247 billion from online sales alone from its own merchandise and earned about $54

billion from third party merchandise.

It should be noted that this is just by it an online store which in total the money was about

US$195.009 billion in revenues. This revenue was even high than the largest online retailers

available. Amazon as a company has grown much faster than the entire U.S e-commerce market.

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From an analysis point of view this growth rate is an indication that this significant growth rate has

been as a result of Amazon taking the market share of other e-commerce organizations.

One would ask, what could be the key driving factor to this tremendous success of

Amazon? According to their own report, their success lies mainly in the low-cost structure and

nothing else. When a retail company has a low-cost structure, the results are lower prices which

when combined with a huge gives every customer an experience that is worth it. When a customer

is satisfied, he or she will definitely return to the same company when in need so that he or she

could experience the best customer service once again. They would, in turn, create ever-growing

traffic by referring other customers to experience to the customer, on the other hand, they would

attract the third parties who would understand that their good would work well under Amazon

Platform (Opresnik, 2018, July).

All these drivers do create a business environment that is growing day in day out. In

amazon, their key leadership structure happens to be a cost leadership one, but the issue here is not

about the structure alone. The issue here is about how Amazon is using the cost leadership

structure to outshine other retailers both online and offline.

Selection structure.

According to sources like Scrape-Hero, Amazon as a company has a variety of products on

its online shelf line. It is estimated to sell around 120 million products on its website,

Amazon.com. in comparison to competitors like Walmart about 42 million variety of products

annually (Opresnik, 2018, July). In a keen analysis, one can clearly see that Amazon’s immediate

competitor only say about 36% of what Amazon sells. This is a very big difference that is not

normal for competition, more so immediate competitor as to say. This high range of product

analysis is the main reason why Amazon than Walmart’s e-shop (Ives, Cossick and Adams, 2019).

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Low Cost Structure

By now I think this particular point is self-explanatory, by mainly selling online and not

having to put physical stores, Amazon doesn’t incur very high costs that come with physical retail

outlets such as rents. Low cost in the online market can also be achieved by the selling of more

units without worrying about an increase in the marginal cost. There is an innovation culture in

Amazon that makes it operate at a low cost. It invests in both additional centers and to existing

centers to enable a reduction in the order fulfillment (Opresnik, 2018, July).

Weaknesses

It is a fact that every company that is very successful no matter how strong is in the market it

comes with weaknesses. Amazon’s weaknesses mainly come as a result of growth and expansion.

From a SWOT analysis perspective, we are going to analyze it. These weaknesses that are

significant to be looked at.

Imitability Business Model

It is evident in this digital and internet boom error has now become very common. Everyone is

imitating the online retail business model. Therefore, when a new start-up with sufficient resources

try to imitate Amazon’s business model and come in with a good structure can give Amazon a run

for its money. As we speak, a few companies like eBay are giving Amazon a tough time.

Nowadays the cost of obtaining an online platform is very easy. It has a business model that is

very easy to imitate and sell about anything that the company can access.

Limited brick-and-mortar presence

The term “brick-and-mortar” basically refers to the traditional street-side business that was offering

products and services. In this way, the local grocery stores are good examples. Now, when it

comes to Amazon it has already shown that it has a very limited brick-and-mortar presence. He

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first disadvantages Amazon faces is trust, customer build trust when there are in physical

appearance with the customer service experience.

Amazon of the other hand lacks local attraction since the physical touch does not exist.

Many people are making it, comfortable and gathering place for enthusiasts. As long as Amazon’s

service is rated highly, it could be even more appreciated if there were physical retail shops.

Limited penetration in developing markets

This is a weakness that Amazon a company has been able to address, it has made Amazon not to

benefit from high economic growth rates of these markets. This alone has denied Amazon a

competitive advantage.

Opportunities

There various opportunities that Amazon can work on them and then improve in the entire

Amazon business model. From the SWOT analysis perspective, this aspect identifies external

factors such as growth in the international markets, in areas that were initially hostile like India.

Expansion of brick-and-mortar business operations

From a deeper analysis, there is an opportunity for Amazon to venture into a brick-and-

mortar operation. This would lead to very many external factors such as the potential revenue

increases (Chernev, 2020). With will develop a stronger presence of Amazon existence and

companies would feel more and more. The company will gain more trust and confidence from their

loyal customers.

Partnerships with other firms, especially in developing markets

In terms of partnership with other firms, Amazon is already doing great work. The latest is a

partnership with Rivian, an electric car manufacturing company that would assist them in the

logistics services of Amazon. This is an external strategic company that will assist Amazon to

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increase their profits margins. In case of an approach to a new market demographic Amazon can

decide to partner with a company with a strong corporate record and business loyal so that it can

improve its corporate social responsibility strategies and leadership management (Chernev, 2020).

Threat

As a successful which has grown so fast and tremendously it has to in one way or the other

experience potential threats to its business model. These threats are mostly external factors in one

or the other limits. It must address the following threats in order for it to be sure of stability in its

business module (Opresnik, 2018, July).

High competition with both online and non-online firms

By far, competition remains to be one of the strongest threats that Amazon is facing right

now, the pressure alone represents represent strategic challenges in the market for Amazon to reach

its intended market share. In the e-commerce segment alone, eBay is a top competitor of Amazon.

The company website is very unique in such a way that it engages both business-to-business and

business to consumer sales. It also uses a third-party vendor which like we have earlier seen this

strategy is also implemented by Amazon.

Some other companies like Home Depot have also emerged in the market and have

risen to the level of being a competitor that poses a direct threat to Amazon's business success.

However, just like Amazon started as an online book store, Home Depot started like a home

improvement retailer. It offered construction services and products to North American countries

such as the United States, Mexico, and Canada. It went further and added an online platform and

the company generated about $7.3 billion dollars.

On my deeper analysis, I have realized that Home Dep success came as a result of online

community presence which initially was dominated by Amazon. Over the years, Home Depot has

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invested more money into the creation of a more efficient and customer friendly website and

mobile application. These two services came with improved functionalities that would in turn

increase and maintaining a better customer base.

Trends/The Rise of Voice-Commerce

It is evident that voice shopping is growing rapidly among the many internet users. It was noted

that in 2019 that almost 13% of U.S voice speakers were making different owners. This commerce

trend has grown popularity. While voice shopping is still in its early stages the future is very bright

on it.

Environmental Topics Influence Buyers

Since green consumerism is on the rise, there is need of different brands need to take action.

Digital consumers are loud on this saying that there are environmental concerns impact their

purchasing decisions. However, e-commerce which includes different practices of sourcing

products from fair-trade organizations to help in the creation of a greener ecommerce environment.

Consumer Trends

When it comes to consumer trends it is evident that mobile shopping is growing, this is because

since 2016. Sales that have been made via mobile devices have increased tremendously by 15%

and it is projected to rise to about 74% in the year 2021.

Strengths to Opportunities & Converting Weaknesses and Threats

Its low-cost structure can be a very good opportunity for on in the venturing into other countries

where the online retailer offers very high prices and this will be a golden opportunity to showcase

its competitive advantage (Chernev, 2020).

Imitability business model is part of the major weakness that it has but it can be converted

to very big strengths. Introducing of brick and mortar presence will be a major strength to them.

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Marketing objectives

Amazon offers a wide range of products and services, successfully exploiting more than

one segment at the same time. Specifically, the online retail giant sells almost 120 million

products, appealing to the needs and wants of a wide range of customer segments. Our marketing

objectives are summarized as follows this includes customer obsession rather than competitive

focus, passion for invention and we are committed to achieve operational excellence and a very

long-term thinking strategy (Chernev, 2020).

A new market segment which consist customers of age 21 to 29 years old youths, the teens

can stream and even shop independently, although parents can be able to improve the order for

teens. 29-year-olds. This

Will entail the development of a customized product by June 2020 that will address the

specific psychographic and technological needs of this age group. This strategy is expected to

attain a 21% growth in overall sales by January 2020. Customer loyalty (willingness to recommend

the product) will increase by 45%.

Part B: Marketing Data Analysis

Source What it Measures Data Potential Usage

Consumer Data Consumer monthly purchases

Average sales that month in US dollars for each of 10 products. Data can be segmented by business and consumer markets

Can be used for trend analysis, projections, and to measure effectiveness of promotions.

Sales data Sales data monthly Average sales that month in US dollars for each of 10 products. Data can be segmented by business and consumer markets.

It can be used in the prediction and company’s decision making

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Secondary Data

Source What it Measures Data Potential Usage

retail store analytics Dollar value of sales by quarter by major product categories

Total sales of major players

Market Share Analysis

Seasonal patterns

IT information technology data

It measures the technological advancements in the company

Total technological activities in the company

Technological analysis.

Customer data Customer activities in the company

Number of activities on monthly basis

It can be used in the prediction and company’s decision making

Secondary Data

Source What it Measures Data Potential Usage

Consumer data It measures the different consumer behaviors

Both Quantitative and Qualitative

To study and be able to predict different consumer behaviors

Focus group Product usage, motives, identify group level satisfaction, decision process, etc.

Qualitative Identify different reactions of market segments to product. Identify marketing opportunities, product/service flaws and opportunities

Prospect Data It measures the different types of company prospects

Qualitative To study and be able to predict different prospects outcome.

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Customer Relationship Management

CRM Touchpoint Purpose & CRM Objective Data Potential Data Usage

Customers feedback on the website

Starts with the customer name and reason for the feedback.

Anything that the customer wants to feed back on.

To improve our services to our customer and measure the amount of customer satisfaction we offer

Customer profile information on website

Starts the account for visitors: name, geography, email address (Customer acquisition)

Presale: geographic location; customer id, source of reference

Email address

Post sales: address, product purchased, quantity, price.

Track new and returning customer counts, total period purchases by customer ID, geographic sales data. Can be used for loyalty rewards, retention, and targeted marketing.

New Target Market

Amazon has grown worldwide with a big network in such a way it would be easy for it to expand

in the developing markets. This move would be very effective when Amazon occupies the market

before any other online retail company available. This will enable the company to obtain a fair

share in countries that are developing and have a little to barely any experience. These places are

like Africa where almost all there are many countries.

A new market segment which consist customers of age 21 to 29 years old youths, the teens

can stream and even shop independently, although parents can be able to improve the order for

teens. 29-year-olds. This

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Will entail the development of a customized product by June 2020 that will address the specific

psychographic and technological needs of this age group. We will try as much as possible to have

the price down as we can.

Marketing Implementation Plan

 Setting the right expectation

 Build the team and secure Resources

 Communicate the plan

 Keen monitoring.

Marketing Communication Channels

Channel Target Market Advantages Disadvantages

Private messaging software

Every consumer universal It is expensive

Direct E-mail Middle class residential

Can include coupons Expense and low return rate for given product

Customer Newsletter All customers Can include coupons Very demanding

Strategic Actions

Action Date for Completion Person/Role Responsible

Standard/Metric

Conducting first 12/14/2020 John Doe, chief Approval by CEO

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Action Date for Completion Person/Role Responsible

Standard/Metric

action meeting marketing officer

Design flyer for direct mail campaign

1/1/2021 J. Smith, graphic designer

Approval by senior marketing team and legal

Design a poster for a billboard

2/2/2021 Christine Henry, assistant Graphic designer

Approval by senior marketing team and legal

Monitoring

Action Target Person Responsible Inter-measurement

Direct mail flyer 1100 new inquiries Western regional manager

500 new inquiries first month of campaign

Customer Newsletter 1400 new inquiries Central regional manager

300 additional inquiries for the second campaign

Private messaging 1700 new inquiries Western Regional manager

300 additional inquiries for the second campaign

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Reference

Chernev, A. (2020). The marketing plan handbook. Cerebellum Press.

Han, Y., Qu, S., Wu, Z., & Huang, R. (2019). Robust consensus models based on minimum

cost with an application to marketing plan. Journal of Intelligent & Fuzzy Systems, 37(4), 5655-

5668.

Melchiorre, M. M., & Johnson, S. A. (2017). Finding new ways to reach older students:

Creating a social media marketing plan for professional and continuing higher education

programs. The Journal of Continuing Higher Education, 65(2), 73-81.

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Opresnik, M. O. (2018, July). Effective Social Media Marketing Planning–How to Develop

a Digital Marketing Plan. In International Conference on Social Computing and Social Media (pp.

333-341). Springer, Cham.

Ives, B., Cossick, K., & Adams, D. (2019). Amazon Go: Disrupting retail? Journal of

Information Technology Teaching Cases, 9(1), 2-12.

D'Agostino, J.L., 2018. The Impact of E-commerce on Brands: An Analysis of Amazon

and a Plan for the Future (Doctoral dissertation, University of Oregon).

Polacco, A. and Backes, K., 2018. The amazon go concept: Implications, applications, and

sustainability. Journal of Business and Management, 24(1), pp.79-92.