Introduction
Currently, Amazon is one of the world’s largest companies, offering a wide range of goods and services online. The business now plays a significant role in the world economy. In the United States, Amazon.com accounts for one in three online purchases (Hitt et al., 2008). To gain a general idea of what it is dealing with, every second consumer of an online store first visits Amazon and examines the prices of goods there (Bloodstein, 2019). However, the company needs to follow trends immediately and regularly identify unmet customer needs to maintain its leadership position in the face of emerging potential competitors.
Amazon Potential Competitors
Currently, Amazon has a significant gap compared to other market participants. However, some firms, such as Jet.com, can beat Amazon in the marketplace. They can do so by identifying a specific market that is under-targeted by Amazon and targeting it (Hitt et al., 2008).
Potential Amazon competitors should optimize their advertising by leveraging information about Amazon’s competitors to gain a competitive edge. For example, they can target their ads to the same target audience as Amazon, but with a more attractive ad (Lai et al., 2022). The basic idea is that brand queries and competitor brand names are used as keywords. This allows potential competitors to advertise their business and offer an alternative product or service whenever a user searches for them on the search engine.
Google vs Amazon
Google is a formidable competitor for Amazon, as its customer audience also has a considerable scale. Like Amazon, Google is among the top five global corporations, making it a serious rival (Lai et al., 2022). Both companies are growing at a rate of 10-20% annually, although Amazon has outpaced its competitor in terms of revenue growth over the past few years (Hitt et al., 2008).
The search giant has already signed more than 75 APIs for cloud solution developers, surpassing Amazon (Bloodstein, 2019). Additionally, Google is recognized as a master of fast development cycles (Lai et al., 2022). Therefore, Amazon needs to exert considerable effort in maintaining its leadership position in competition with Google.
Amazon’s Major Strengths & Weaknesses
The first, and essential, plus of Amazon is the variety of goods. This is an online supermarket with hundreds of thousands of different products. On the website, clients can find a wide range of goods, including books, appliances, electronics, clothes, cars, jewelry, and many more. Representation in seven countries, including the USA, is also an advantage (Bloodstein, 2019). The customer can choose the best store for them, which offers the best prices and delivery terms.
Amazon has a tremendous reputation worldwide. This is a company with a name and over 20 years of sales experience (Hitt et al., 2008). Although there are numerous products, they are clearly categorized into distinct groups (Lai et al., 2022). Searching through these categories will not be difficult, which is another strength of Amazon. Another benefit for customers is that discounts and special deals are often available, allowing them to purchase high-quality items at competitive prices.
Amazon’s weaknesses include overloaded pages, advertising on product pages, and an unsuccessful interface of product category pages. In addition, the lack of integration with international sites can be considered a weakness. Amazon offers fully localized versions of its website in six countries, in addition to the USA (Lai et al., 2022).
However, there is no integration between these sites. Another weakness is the parallel branding resulting from Amazon’s policy of allowing other companies to utilize its engine (Lai et al., 2022). As a result, there is considerable confusion, as users do not understand which company they are dealing with.
Jet.com as a Potential Concern
Jet.com is a potential concern for Amazon because it carefully targets Amazon, trying to identify its unclosed or insufficiently addressed market segments. For example, such segments include the sale of diapers, which led to the creation of a serious competitor to Amazon Diaper.com (Hitt et al., 2008).
The trading platform Jet.com aims to create a new e-commerce model with the lowest prices for goods. The retailer aims to establish itself as the most profitable online store (Lai et al., 2022). Each product will be 10%—15% cheaper than on other sites (Lai et al., 2022). In addition, Jet.com collaborates with other companies that are competitors of Amazon, such as Google (Hitt et al., 2008). Thus, it increases its net market value, getting more opportunities for further development and growth of the company.
Conclusion
Thus, Amazon is still the leader in the retail market. This is due to the positive brand reputation developed over the years, worldwide availability, and a wide range of profitable products. At the same time, the company has quite serious competitors, such as Google or Jet.com. Currently, Amazon has a gap in net worth and popularity compared to these potential serious competitors. However, to maintain the company’s leadership position, it is essential to continually improve and stay current with trends, thereby avoiding being outpaced by competitors.
References
Bloodstein, B. (2019). Amazon and platform antitrust. Fordham Law Review, 88(1), 187-197.
Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2008). Strategic management: Competitiveness and globalization, concepts. Cengage Learning.
Lai, G., Liu, H., Wenqiang, X., & Hoskisson, X. (2022). “Fulfilled by Amazon“: A strategic perspective of competition at the e-commerce platform. Manufacturing & Service Operations Management, 24(3), 1261-1885.