SWOTT Analysis

STRATEGIC PLAN PART 1: NEW PRODUCT OR SERVICE

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New Product or Service

Amazon has become a staple in many households globally. Amazon was established in 1994 by Jeff Bezos as an online bookstore. Since then they have expanded to offer a variety of products and services. While Amazon has opened a few brick-and-mortar spaces, the company just purchased Whole Foods. “Amazon agreed to buy the upscale grocery chain Whole Foods for $13.4 billion, in a deal that will instantly transform the company that pioneered online shopping in a merchant with physical outposts in hundreds of neighborhoods across the country (Wingfield & de la Merced, 2017).” Amazon historically has tried to break into the grocery business by offering items frequently found in grocery stores in their section called the Pantry, but items such as perishables could not be purchased and shipped. The new acquisition is a step towards consuming one more market in the shopping market.

Customer Needs and Competitive Advantage

Amazon has strived to change the shopping experience online from day one. “In the Amazon world, every transaction is recorder, every buyer is known, every inventory movement is known, and perhaps more importantly, every possible next order can be suggested based on what visitors buy and browse (Aziza, 2017).” The technology Amazon has invested in has set the standard high for all other competitors. The company also allows users of products to leave personal reviews of the products purchased which gives an advantage to buyers. They can read the reviews and determine if the product is one they want to purchase. Another competitive edge that Amazon is able to offer are the many comparable products by different companies and the purchaser is able to browse these items. They also can filter the findings by price, rating, and Prime availability. Amazon has strived to stand out by offering many new innovated ways of shopping and delivery. They guarantee 2-day delivery on items that are considered Prime for their prime members, hassle free returns, subscriptions to items frequently bought with a discount when you sign up for the subscriptions, and they display other items that the consumer might possible be interested in when purchasing an item. These items will be shown as “items frequently purchased together” on their website. There is also a browse history of items similar to the ones you are viewing that other consumers reviewed and or purchased.

Amazon’s technology is increasingly providing convenience and worry free for its consumers. This competitive edge puts Amazon at the top. New technology such as the Amazon Dash Button has revolutionized how to restock and order ordinary items.
“The Dash Button is a single-function controller, no larger than a pack of gum, that users place around the house. Each button corresponds to a household necessity, such as toilet paper, razors or trash bags. When the user is running low on a product and needs a restock, he pushes the appropriate dash button and the product will arrive on his doorstep (Invstopedia, 2015).” To make their presence known in the grocery market, AmazonFresh was launched in 2007 (Invstopedia, 2015). Customers were able to place orders and a truck would deliver them sometimes the same day or the next. This model was only available in certain geographic areas such as New York City, San Diego and a few larger cities within the United States.

Vision and Business Model

“Amazon.com Inc.’s vision and mission statements have pushed the company to become the largest online retail in the world and their success is attributed to the stringent measures to ensure that the mission and vision statements are fulfilled (Gregory, 2017).” “ Amazon’s vision statement is “To be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online” (Gregory, 2017).” While the vision statement is broad, it demonstrates the dominance and strive to provide service world-wide and to expand globally by providing customers with any item of their desire. With the new acquisition this vision statement will need to be modified slightly. The focus on becoming a staple in the grocery industry with various locations in North America will change the vision due to items now being offered in the stores.

“Amazon’s mission statement is as follows: “We strive to offer our customers the lowest possible prices, the best available selection, and the utmost convenience.” (Gregory, 2017).” Amazon has lived by this mission statement when you browse their site. They offer a variety of items with different prices depending on the seller. The convenience comes into the fast shipping and options even as one-day delivery. Prime customers received free 2-day shipping on certain items which eliminates the buyer from wasting time, gas, and possibly money on items they can have delivered at home quickly.

New Alignment with the Company’s Mission, Vision and Values

Amazon’s new acquisition will move them into another industry in which they can potential dominate as they have with online retail. Amazon’s visions, mission statements and goals have proven to be strong for the online retail. The grocery industry could potential face new obstacles if Amazon provides the same mission and goals that it has put in place. Food prices could become lower as well as convenience of shopping and purchasing. While the new trend of grocery shopping is now ordering your items and picking them up at a designated time, Amazon could raise the bar by offering delivery services.

“Whole foods is best known for its organic foods, building its brand on healthy eating and fresh, local produce and meats. (Wingfield & de la Merced, 2017) When Whole Foods is mentioned throughout society it is known as being very pricey, low selection of a variety of foods, and organic and freshness of produce and meat. The high prices and low selection is a conflict of Amazon’s core values and principles. The evaluation of the dynamic of the store and its products will need to be aligned to Amazon’s vision and mission statement.

Summary of Strategic Direction

The basis of Amazon’s strategy will remain the same which is to build customer base while offering many facets of products and services, providing affordable items, and offering services that provide convenience to the shoppers. These goals and strategies will be no different with the physical presence Amazon will now have. “In Seattle, it recently opened two grocery drive-through stores where customer can pick up online orders, along with a convenience store called Amazon Go that uses sensors and software to let shoppers sail through the exists without visiting a cashier (Wingfield & de la Merced, 2017).” Amazon’s physical presence is now bringing them closer to all consumers. “The grocery chain includes more than 460 stores in the United States, Canada and Britain with sales of $16 billion in the last fiscal year (Wingfield & de la Merced, 2017).” This opens more opportunities to serve their customers by having more physical presence geographically.

Guiding Principles and Values

The company’s principal and values are to stay ahead of the competitors and provide the newest innovation and technology for its customers and potential new customers. While broadening their services, the organization will be able to reach more people globally and provide more efficiency, possible lower prices and customer satisfaction which are aligned with their vision and mission statements. Their constant drive can be seen as through the “multiyear offensive to open warehouses closer to customers so it can deliver orders in as little as two hours, and Whole Foods stores will further narrow Amazon’s physical proximity to its shoppers (Wingfield & de la Merced, 2017).” The core values of all of Amazon’s employees no matter their position are “ customer obsession, ownership, invent and simplify, are right, hire and develop the best, insist on the highest standards, think big, bias for action, frugality, vocally self-critical, earn trust of others, dive deep, have backbone, and deliver results (Satterfield, 2014).” By staying true to their values and principles, the company is able to create leaders, set higher standards within the industry as well as create new innovative ways to shop. According to Amazon’s website they state, “We use our Leadership Principles, every day, whether discussing ideas for new projects, deciding on the best solution for a customer’s problem, or interviewing candidates (N.A., 2017).”

References

Aziza, B. (2017, June 23). Forbes. Retrieved from Amazon Buys Whole Foods. Now What? The Story Behind The Story: https://www.forbes.com/sites/ciocentral/2017/06/23/amazon-buys-whole-foods-now-what-the-story-behind-the-story/#7b20b4b7e898

Gregory, L. (2017, February 12). Amazon.com Inc.'s Vision Statement & Mission Statement (An Analysis). Retrieved from Panmore: http://panmore.com/amazon-com-inc-vision-statement-mission-statement-analysis

Invstopedia. (2015, June 22). Investopedia. Retrieved from 5 Amazing Technologies Developed By Amazon: http://www.investopedia.com/articles/markets/062215/5-amazing-technologies-developed-amazon.asp

N.A. (2017). Amazon. Retrieved from Amazon: https://www.amazon.com/p/feature/p34qgjcv93n37yd

Satterfield, D. (2014, June 15). the Leader Maker. Retrieved from Core Values: Amazon.com: http://www.theleadermaker.com/core-values-amazon-com/

Wingfield, N., & de la Merced, M. J. (2017, June 16). Amazon to Buy Whole Foods for $13.4 billion. Retrieved from The New York Times: https://www.nytimes.com/2017/06/16/business/dealbook/amazon-whole-foods.html