STRATEGIC MARKETING: AMAZON GO

Table of Contents
Task 1 .............................................................................................................................................. 3

Executive Summary .................................................................................................................... 3

Task 2: Strategic management plan ................................................................................................ 4

2.1 PESTLE analysis ................................................................................................................... 4

2.2 Porter's five forces ................................................................................................................. 6

2.3 SWOT analysis ...................................................................................................................... 7

2.3 SMART strategic objectives ................................................................................................. 9

2.4 Market segmentation for Amazon Go ................................................................................. 13

2.5 Brand positioning for the target market segment ................................................................ 14

2.6 Significance of marketing mix ............................................................................................ 15

Reference List ............................................................................................................................... 17

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Task 1

Executive Summary

Presently, the competition in business is at its most robust position. Every company is running to
win this fierce market competition. Gradually, companies are utilising the concept of strategic
marketing to improve their business strengths. This presentation focuses on discussing the
principles and significance of strategic marketing for business purpose. Strategic marketing is a
process that involves improving the organisational activities, including strategy making,
development, and implementation of the strategies to gain the maximum competitive edge.
Strategic marketing of a company helps it to gain strengths for fighting against the fierce market
competition and achieve success in its desired goals. In order to attain the objectives or goals of a
company, it is essential to utilise the concepts of strategic marketing and importance in business
growth. This presentation also describes the necessity of the proper process of marketing
planning. Effective marketing planning assists every company to create plans, allocate marketing
resources, analyse the current situation and implement marketing strategies. Through
implementing proper marketing planning, a company can rectify its errors and improve its
strategy to be stronger in marketing.

Moreover, the presentation involves discussing the concepts of marketing and its significance in
the marketing planning process. The discussion of marketing concepts includes four significant
marketing concepts, including product concept, production concept, marketing concept and
selling concept. Production concept demonstrates the requirements of customers based on the
products that are highly affordable and easily accessible. Product concept explains that the
customers only choose the products that are the best in quality, features and performance. Selling
concept highlights that the customers do not purchase the products of a company if it doesn't
focus on the promotion and selling of the products. Lastly, the marketing concept states that a
company can gain more profit and achieve success in business if it concentrates on fulfiling
customer requirements. All these marketing concepts are essential for companies that want to
implement effective marketing strategies for reaching the peak of success.
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Besides, this presentation also covers the significance of branding based on the famous company
Amazon. Branding of a company involves distinguishing the products of a company from the
products offered by other companies in the market. Branding helps the companies to establish a
sharp image within the marketplace. It also assists every company to be well-known among the
customers and to gain customers' trust. Moreover, it increases the customer base of a company
like Amazon and leads the company to occupy a certain place in the market. Apart from these,
the presentation also describes the importance of the brand pyramid to increase customer loyalty.
Creating a brand pyramid leads a company to be the winner of fierce market competition by
making a strong relationship with customers. Brand positioning and brand management are also
discussed in this presentation. Brand positioning helps a company to increase reasons for the
customers to buy its products; whereas brand management assists a company in managing all the
aspects related to the improvements of its branding. Therefore, it can be said that the
presentation is a complete package for discussing strategic management.

Task 2: Strategic management plan

2.1 PESTLE analysis

Amazon is an E-commerce industry has diversified business model. The company has simplified
its shopping experience of the customers and has made it easier for them without being in a
queue for a transaction. Turlais (2016) stated the PESTLE analysis report is comprised of
different factors that include political, economic, social, technological, legal and environmental
models. It mainly focuses on providing details insights regarding the company Amazon go and
further it helps to understand all the internal as well as the external factors. This will further lead
to influence the macro business environment of Amazon go. Being one of the giant retailers with
online services made the business grow globally and play a pivotal role. Frue (2020) contrasted
that marketplace of Amazon depends on the behaviour of the government, its activities and its
support. Political and economic stability acts as an opportunity to set up various operations that
help to boost company economics.
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Political Factor: Turlais (2016) asserted, Amazon Go relies on government support for
implementation, distribution and profit. Amazon abides by the rules and regulations. Amazon
deals with free trade that is a positive aspect of modern-day politics. Amazon has red tape
politics and is tightening the data regulations. Expanding and distribution into Asian countries
can be off-limits. Amazon services are shoved by not mentioning taxes in foreign countries.
Amazon needs to be updated regarding the taxes and its fluctuating numbers.

Economic factors: Frue (2019) stated that economic factor analyses the competition and the
competitors and helps to flourish the business economy positively. Disposable income of
Amazon is higher these days that results to improve the accessibility of all the users. It analyses
the reduction of job opportunities and employing the use of new technologies in several
countries, which includes the UK. Moreover, strong GDP growth rates are increasing with
respect to emerging Amazon go markets.

Social factors: It showcases shift in the retail markets of United Kingdom and enhances the
landscape of e-commerce business as well. D'Agostino (2018) stated, this expansion of the
grocery industry has enabled the customers to deal with technologies in their day to day life.
Being a prime member, it helps the customers to go cashless and not being in a queue for a
cashier.

Technological factors: According to Turlais (2016), Amazon uses just walk out technology that
requires computer vision and sensors Amazon is a technology company that is greatly impacting
their profits by attracting the customers with the use of the application and registering them in by
the use of the application. This application is useful for people to buy things easily without being
in a queue. Amazon Go provides an easy way to shop that also helps to save the time of the
consumers (Amazon Inc. 2020).

Legal Factor: As per the opinion of Frue (2019), Amazon's business operations comply with all
the rules and regulations. It has antitrust laws, consumer protection laws, data protection laws
and many more that help to increase the business with anti-counterfeit policy and is one of the
authentic platforms for the customers. General data protection regulation standards are also used
by the European Union.
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Environmental factors: Amazon has limited disclosure on sustainability and environmental

disclosure. It resists pressure from the stakeholders and investors to provide services that
positively impact the environment. It has established its sustainability report through extensive
global operations with a wide environment (Amazon Inc. 2020).

2.2 Porter's five forces

This framework is developed by Michael Porters to analyse the competitive landscape of

Amazon Go. The framework uses potential profitability to gauge the industry in the market. This
framework is used to analyse the competition of the newest Amazon store in UK. It provides
checkout-less grocery service that is named to be as Amazon Go.

The threat of New Entrants

As opined by Kamesh-Medium (2020), Amazon go is a concept of grab and go store of grocery.

It is newly introduced to the public because of the technical barriers that are caused during online
transactions being it online or bring it in cash transactions. For some of the significant threats
that took place because of deploying deep computer vision, learning and sensor fusion.
Subsequently, it is seen that the company Amazon go is rolling out public and is slowly
increasing its market among the new people as well. D'Agostino (2018), contrasted, the recent
acquisition of Amazon tech and speed, it has become unstoppable and has been poised to
disruptive forces to revolutionaries the market and mortar stores grocery across different parts of
the countries. Threats of new entrants to the market are low in pressure as it deals with tech
giants that have a technical arsenal.

Threats of substitutes

As stated by Kamesh -Medium (2020), grocery stores are the traditional stores that exist in
substitute services, and it provides various offers to the customers for quick entry, and exit in
Amazon go. However, consumers still prefer shopping at established and traditional chains of
grocery because of its loyalty factors and simplicity for adamant about changing. It is analysed
that the company Amazon Go isn't immune to the adoption curve because of medium pressures
of substitute products.
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Bargaining power of Buyers

As opined by Kamesh-Medium (2020), rolling out all the grocery stores, Amazon go is started its
chain in various locations that help attract enthusiastic customers. Lack of substitute services
focuses on the bargaining power of the customers. Further, it offers a level of convenience to the
customers in grocery stores for charging higher prices (Amazon and the US Food Retailing
Industry, 2020). Diverse customer base is attracted to Amazon go, and it relies on customer
segmentation because of its low bargaining power of the buyer.

Bargaining power of suppliers

The core competencies of Amazon are its infrastructure because of its logistics and supply chain.
Numerous operations and new distribution channels are adding new cogs to the wholesale, retail
markets. Moreover, Amazon's management prevents the brand's representatives for promoting
their brands and products in the Amazon go stores (Amazon and the US Food Retailing Industry,
2020). The company also adapts whole food suppliers to strengthen its ability to promote organic
brands with the help of a diverse array of suppliers.

The rivalry between existing firm

Amazon has entered the natural grocery space to deal with face to face competition among the
major rivalries market and Joe' Trader. Amazon targeted to slash its prices of products across
stores for appeasing and attracting all the new customers from other stores. The competition
among Amazon Go, and the whole-food market is evolving quickly in the market and analysing
its dynamic pan outs. Amazon Go is analysing its high and low pressures from the existing firms
in the market. It leads to ensure face to face competition (Amazon and the US Food Retailing
Industry, 2020).

2.3 SWOT analysis

Strengths weaknesses

● It is the world's leading online grocery ● Easily imitable to the business models
retailer company ● It has possible job losses

● It focuses on the prolonged strategy
that includes thrust leadership, focus
and differentiation.
● Strong brand name with a strong
position and successful brand image in
the market (D'Agostino, 2018)
● Amazon go deals with customer-
oriented programs that meet everyday
needs with low prices
● Frequently brings differentiation and
innovative ideas to enhance the
product line and service offerings
● It has the largest merchandise
selection programs by lowering its
inventory replenishments.
● It deals with go Global and Acts local
strategies against domestic e-
commerce rivals.
Opportunity
● Opportunity to penetrate and expand
its operation in developed markets
● Expansion of physical stores in
different locations that helps in
improving competitiveness
● It engages new customers by
enhancing its brand image (Smith et
al. 2017)
● Expansion of backward integration
that will improve the profit margins of
8
● Supplying of fresh produce and meats
in Amazon Go
● Tax Avoidance controversies take
place on social media networking.
● Mortar presence and limited brick, it
sometimes hinders the customers'
attraction
● Failure and flopping products due to
near-zero market business and denting
its profitability (D'Agostino, 2018)
● It has risk diversification perspectives
● Cognizant of losing strategic
advantages from the core
competencies.
Threats
● The company has to deal with various
controversies caused due to dent in
brand imaging
● Threatening in the business proceeding
because of governmental regulations
● Aggressive competition among the big
retail companies such as eBay and
Walmart
● Imitation of new entrants in the
business model of Amazon Go.

Amazon go (Smith et al. 2017)
● Improving all the technical measures
and its organisational policies
● Dealing with more acquisitions that
will increase the company’s market
share and further reduce the
competition level
2.3 SMART strategic objectives
Specific Measurable Attainable
9
● Advanced tracking of technologies
with no bagging and cashier
● Traditional shelf stockers that account
vulnerability (D'Agostino, 2018)
● Disruptions in grocery buyers that will
further cost jobs.
Relevant Time-Bound
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Improving It can be It can be It is relevant to Time scale is one

Department measured with attained by key factors that of the big factors
Ratings
the high-quality providing include quality, that analyse
food that is products of all quantity, good organisational
provided by the the brands as services and competitiveness.
company per the choices strengthening This creates a
Amazon of the their links to sense of urgency
(Varma, 2019). customers. This numerous to meet the
It can also be also helps to customers organisational
measured by make ratings to goals
fresh and upgrade certain
weighted departments in
grocers the stores with
the products of
different
brands. The
increasing
customer base
will increase
the
departmental
ratings
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Building It can be Customer Marketing It takes huge time

customer measured by loyalty agencies and to build customer
loyalty the repetitive programs can specific loyalty programs.
comeback of be attained by merchandising It takes huge time
the customers rewarding the aims in because the
every week or customers and increasing the majority of
every month. providing them factors of people still
The building of with huge customer prefers traditional
new customers discounts loyalty (Varma, grocery
by suggesting (Ottman, 2019). Rewards shopping.
the 2017). Use of and discounts
convenience of magnetic stripe are judged in
Amazon stores cards is relevance to
to people obtaining new other companies
customers as it
is one of the
most
convenient
ways of
shopping. It
uses sensor
fusion and
computer
vision from
entering and
leaving the
store.
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Increasing It can only be It can be attained More the This will take less
customer measured by by providing customer traffic time to enhance the

traffic marketing the plenty of parking in the business within the

space and organisation more limited time frame
stores and
convenience to is the profitability that is predicted by
sharing
the customers. margin of the the organisation
information’s
locating the organisation in all (PURCĂREA,
to the new
stores in high the
locations 2018).
customers and
traffic areas that across countries.
idealising the is convenient for
beneficial the customers
aspect of Just
walk out
technology.

The building of Selling of high Increase in sales, Increase in the Increase in the
sales and profit and brand and market products and sales and the
products will shares can only services based on market share of the
lead to earning be attained by the preferred organisation it
the highest increasing the brand will lead to takes time to get
profits (Varma, customer base in an increase in the identified in the
2019). This can the organisation. sales ratio and market and make it
only be It can also be market shares. convenient for the

measured by the attained by This will lead to customers with the

level of focusing on the the mass availability of their

competition and interest of the merchandiser in preferred brand of

the increase in customers and the competitive products (Ottman,

the market shares serving them market. 2018).
of the with the best
organisation. services.
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2.4 Market segmentation for Amazon Go

As per the opinion of Dolnicar et al. (2018), market segmentation is a set of activities that aims
to determine the potential market with potential customers into groups and different bases.
Market segmentation of Amazon Go comprised of customers who are aware of various
marketing strategies. In order to understand the market of Amazon Go, it is very important to
identify the geographic, demographic, behavioural and psychographic segmented market. Alt
and Iversen (2017) stated this would help to undermine the brand products preferred by the
customers. In order to enhance the company in a competitive market, the company analyses the
segmented market to incorporate with the individuals while purchasing the products and
services.

Geographic segmentation: in geographic segmentation, Amazon Go targets more than 100

countries in rural and urban places. It analyses the digital sales over real-world sales.

Demographic segmentation: It segments with young people who are familiar with the use of
technological services and has low incomes (Alt and Iversen, 2017).

Behavioural segmentation: According to Jagani et al. (2020), it identifies the people who are a
brand freak and only consumes brand products in their day to day life. In this segment, only cost-
conscious individuals are focused that will attain the cost advantage.

Psychographic segmentation: this includes people of the social class who are mainly concerned
with the prices of the products that are sole in Amazon Go.

Moreover, from the research, it can be identified that Amazon Go is mainly focused on the
segmented behavioural market. Conaway et al. (2018) contrasted that this segmented market is
aware of the cost that is being charged to the customers based on the brand and its services. It is
the interest-based segmented market that combines the interest and engages all the customers
with revenue generated clients.
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2.5 Brand positioning for the target market segment

As discussed by Jun and Park (2017), brand positioning of a company refers to the reason why
the customers will purchase the company's product. The concept of brand positioning focuses on
the activities that attract customers to buy the products of a particular brand. In order to occupy a
certain place in the market, it is crucial for the managers of a company to choose a niche market
and to create a competitive advantage for the company. Through establishing brand positioning,
a company wants to present the customers about their services or products and to provide values
for the customers. Brand positioning is extremely important for the company to attain the target
marketing segments and provide better quality services to its customers.

According to the viewpoint of Nalca et al. (2018), the strategies of brand positioning involves
introducing the associations of brands within the consumers’ mind. It helps companies like
Amazon Go to establish a strong brand image, not only in the customers’ mind but also in the
marketplace. In order to increase customer loyalty for a company, it is important for the
managers of the company to focus on their brand positioning. For example, the brand positioning
of Amazon Go leads the company to focus on creating its products based on customer
requirements. The brand positioning of the company creates a strong brand image and provides
reasons for the customers so that they can buy the products or services offered by the company.

As stated by Malhotra and Bhattacharyya (2019), in order to establish an effective brand

positioning every company must

● Identify the requirements of the customers

● Understand the capabilities of the company
● Evaluate the brand positioning of the competitors
● Implement effective strategies for improving the branding of the company

A significant example of strong brand positioning is Amazon Go. The company aims to build a
cashless transaction system for the customers who have to make a line for financial transaction.
In this context, the company introduces an application for the transaction purpose. This
application not only helps the customers to operate their financial transaction easily but also
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saves their valuable time. This fact leads the company to provide customers with significant
reasons for buying its products.

2.6 Significance of marketing mix

Jindal et al. (2018) stated that Amazon Go is growing its market in retail grocery stores in the
United States and the United Kingdom by selling an array of goods and services. It is growing to
be the international supermarkets in the upcoming world. It refers to all the tactics and actions to
promote the brand products that are available on Amazon Go without being standing in queue for
a longer time. The 4 P's of the marketing mix in Amazon Go focuses on the product, place, price
and promotion. The marketing mix is helpful in increasing the production of services in the long
run.

Product: According to MARKUS (2018), the product strategy in Amazon Go is leading the
platform of just walk out technology. This helps to purchase products easily and immediately in
the store without being harassed in the crowded stores. It is publicly traded and is successful in
managing its core competencies. Buying products in large quantities will help customers to avail
discounts and offers (Moriuchi and Takahashi, 2016).

Price: As per the opinion of Čirjevskis (2019), the pricing of products in Amazon Go influences
its future success and enhances its long term continuity. This helps to determine the
competitiveness of the products by analysing the sold goods and the profits incurred in the
business. On the other hand, Qiao et al. (2017) stated that the company goes with high in value
and maximises the sales in bulk rather than overpricing the products. It also enhances customer
friendly prices

Place: As opined by Fulgoni (2018), location is one of the vital aspects that is faced by the
organisation Amazon Go. The company has opened its location in different parts of the country
that is convenient for the customers and allows them to purchase the bulk of goods in one go.
Ives et al. (2019) asserted, it focuses on geographical placements and enables to trace all the
products that are bought by the customers regardless of inventory and transits. Branding and
differentiation of outlets involve with various discounts and offers.
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Promotion: According to OCHIENG (2017), there are various promotional strategies provided
by Amazon Go to enlighten the public and attract the customers about their stores. Use of
various slogans, low prices and advertisements leads to diversify the platforms of supermarkets
across different countries. It will also heighten the replacement policies and warranties that help
the customers to secure their services in the market.
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