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Amazon kicked off its operations in 1995. It was started of by Jeff Bezos who intended to imitate the size of the Amazon River in terms of large-scale sales. In 2003, Amazon had been able to surpass the $5 billion sales mark. In the year 2008, the company had a global following of 76 million active users with users coming from 200 different countries. This entire people were assisted by 17000 workers who worked around the clock (Dave). The company started of as a bookstore but expanded into DVDs, Music, CDs, and ultimately into an array of different products (Jeff, 2010). This paper tries to dissect the main reasons why Amazon has been extremely successful in relation to the use of digital channels.
2.0 Amazons objectives
The company objectives can be attributed to the success of the company. The company aims at delivering quality service and products to the customers. Customer experience is the main focus. Customer satisfaction is achieved through well priced products, convenience and most importantly, offering the customer a variety of products to select from. Achieving customer loyalty is the companies’ main focus. The measure of customer loyalty is repeat purchase. The company aims at achieving this through provision of user friendly interfaces, efficient services, and dependable transaction surrounding and time conscious services.
Some of the key areas in the company’s website which is the main tool of trade for the company are consumers review sections which gives the consumers an opportunity to raise their opinions on merchandise on sale. The product information is recorded accurately for all to see not hiding any crucial detail. This is done with an aim of assisting consumers to make informed decisions. Pages are tailored according to the various preferences of different consumers. This makes work easier for the consumer as they will not have to go through irrelevant items that are not of their interests (Jeff, 2010).
2.1 Utilization of Digital Channels to achieve success
Amazon has utilized digital channels in a variety of ways in order to achieve success. This mainly revolves around ways in which Amazon has employed marketing in the digital environment to achieve success. The following are the ways in which the company has utilized digital channels.
2.11 Increased customer engagement
Amazon Company has increased customer engagement achieve its success so far. Customer engagement is all about making the customer a part of your company and involving them in shaping up the company while delivering quality merchandise on a timely basis to them. Free shipping is offered when one reaches a specific target. Customer engagement is all about the placement of the strategic goals on the formation of strong and healthy relationships thus encouraging the parties involved to notice mutual benefits from the relationship. For instance, Amazon offers free shipment of goods anywhere within the boarders of the United States of America. On top of this, the company presents to its customers the presentation of the most recent inventory availability, the dates for delivery. In addition to this, delivery shipment notifications and other update facilities are sent to the client. This is a digital tool that Amazon has employed that has attributed to its success (Dave).
Each and every product on their site is available for customer opinion. This is backed up with a digital option whereby the customers have an opportunity to rate a product on the site on a scale of 1-5. The company also comments on some products. This reviews has helped the company to maintain a loyal clientele. This is due the fact that when a person intends on acquiring a new product, they would love to get opinions from people who have used the product before to know if the product will be of benefit to them and to establish it is worth the price being charged for acquisition (Marketing Strategies of Amazon.com, 2010).
2.12 Customer satisfaction metric
Amazon places major emphasis on customer satisfaction metric. This is ensuring that the customers are satisfied to the core. This is simply measuring customer satisfaction in all the dimensions of the organization (Bhardwaj, 2008). This has been achieved by closely monitoring each site. Key areas that are measured are the standard service availability monitoring through mercury interactive. The availability of the site around the clock and the speed of download is closely monitored to. These are some of the digital channels that saw Amazon attain the highest score of 88 in 2004 in the American Customer Satisfaction Index. This is closely monitored by the transaction made on a minute basis and the number of webpage’s by the use of special analytic software’s.
2.13 Continuous website improvement
In the current world where internet is essential, it is paramount to design a simple website. Amazon spends millions in dollars in the identification of problematic areas, development of solutions for the identified problems and the additional improvement of the client’s online experience. Rob, an analyst states categorically that Amazon mainly focuses on analyzing its website traffic and adjusting it in relation the areas that need change. The site uploads faster than most of its competitors showing why many people opt to use it. Jeff says that technology is paramount when it comes to the customer focus. He says that the company uses a variety of techniques that offer the client the latest technology. He says that the company systems are based on the latest trends in the technological field though he thinks that this is insufficient. The company does not rely on previous researches as most of the problems they face are not documented anywhere else. They have to research and develop their own tailor made solutions to their problems. This gives Amazon a niche in the market (Dave).
2.14 Digital Marketing strategy
Little has been said about the companies marketing tactics. This is probably a trade secret that is meant to keep the company in business, to give it a competitive edge and to help it maintain its spot if not rise the bar. Some of their known tactics is targeting specific online marketing channels which include E-mail marketing, Portal advertising amongst others. Customer loyalty is emphasized. The company views free shipping as an effective marketing tool thus there is no future plan of terminating the offer.
Looking closely at the marketing strategy employed by the company you will note that it is mostly digitally channeled. .the company main tools of operations mainly circle the digital world. Without technology, who knows if Amazon could be in existence. Digital marketing has enabled the company tap on the tech savvy users who would be potential uses of Amazon.com.
2.15 Testing Amazon
This is another digital channel that has helped in overseeing the success of Amazon. This was given birth to by the customer satisfaction metrics meant for improving the services. Matt says that there used to be a lot of argument on issues pertaining content placement, whether on the home page or on the other pages. Meetings on web placements where a warzone.
Nowadays, this is a thing of the past as experimentation has come into the picture. Real time tests are done on the consumer behavior portraying the actual behavior of the consumers. This is a digital strategy that is helping the company a great deal to succeed. A/B tests are the key mechanism in experimenting in the company. This tests is usually employed in testing new page designs, moving of features around the web amongst changing other aspects of the website. This test will measure many aspects including units sold, session time, the length of the sessions amongst other important areas. Users’ preference keep on changing over time thus generating the need of altering the website over time. Amazon has been able to continuously test their website thus achieving the success it has. (Dave)
2.16 Internal development of technology
Due to the specialization of Amazon, there is need to develop information technology internally. This is one area that Amazon has mastered in. it has employed several highly qualified researchers who are able to keep their company inline with their changing needs. This has been backed up with a substantial investment in terms of finances, human capital and resource allocation. The company uses their own proprietary technologies as the main drivers. They also obtain licensed technologies from third parties such as companies and programmers.
The internally developed technology uses the distributed development and deployment approach whereby editing the contents of the homepage is slightly easier through the use of pods and slots. This can both change the content and the location on the screen without the need of specialized skill and it saves on a lot of time. The technology employed by Amazon also facilitates for easier electronic transactions. Customer orders, suppliers, inventories and so on are validated and accepted by some applications thus making the work efficient as compared to using human beings. The transaction processing system in the company has strong capabilities. It can process millions of transactions simultaneously and diligently. The whole process is automated, from accepting, authorizing to even charging the client. This has contributed immensely to the success of Amazon (Dave)
2.17 Affiliate Marketing
Amazon sponsors affiliate marketing. This is whereby the company awards other businesses for visitors who are brought by the efforts of the hired business. It revolves around the retailer, network, the publisher and the customer. This has been achieved through the use of Amazon Web Service, links and third party merchants who agree to strategically place links on their websites linking to Amazon company website. The associates or hired businesses receive a fee for every click on their site to Amazon site and a commission incase the click leads to a purchase. This program has been very successful as it has an approximate of one million associates. 40 % of Amazons sales are as a result of the affiliate marketing. This is another way in which Amazon is utilizing their digital channels to achieve greater heights of success.
Amazon is a pillar of success. The company has positively impacted on the lives of many individual. It has been able to employ over 17000 people. This is a major contribution into the economy. Also the company has helped immensely in molding the consumer choice through the use of product rating and reviews. The success of this company can be greatly attributed to its main objectives which are quality. It aims at meeting the changing customer needs which are key to the success of any business. The customer is always right.