Paper Example - Amazon's Market Journey: Successes and Challenges in Emerging Markets

Published: 2024-01-14
Paper Example - Amazon's Market Journey: Successes and Challenges in Emerging Markets
Type of paper:  Essay
Categories:  Marketing Business Amazon
Pages: 7
Wordcount: 1758 words
15 min read
143 views

Market penetration and identification of a specific niche for product and service sale success are a key determinant in emerging markets worldwide. As organizations' need to conquer new markets becomes inevitable, proper market identification and analysis are crucial. Emerging markets have proven potential to enhance organizational expansion and ready market for goods and services. It implies that as an organization, the surest way to be sustainable is by continuously identifying the market for services and products. This paper examines Amazon's entry into China as an emerging market, its success and failure story, and its strategies for ensuring the sustainability of its goals.

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Amazon moved into the Chinese marketplace with no clear comprehension of what the e-market industry exhibited. Amazon strategically entered the Chinese market by acquiring joyo.com in 2005 for about $70 million (Dolata, 2017). During its first year of expansion in China, the company worked under the domain of Joyo.com and focused on goods such as CDs and books, making the change very seamless in the market of China. In 2008 Amazon eventually altered the domain to its brand name Amazon.com. Also, it diversified and enhanced its offering of baby-related items and electronics.

Though Amazon attempted to seriously replicate customer experience and ultimately gain entry into China's market, by evolving from an online store of books to a force of e-commerce, Amazon miscarried to attain its extension and fight to attain a grip on China. Amazon Company failed to align its expansion techniques and implementation strategies, especially when it incorporated a Western commerce approach to market China. Traditionally, American and Chinese markets are much more diverse, and thus, the Chinese market consumers demand a variety of goods and services, hence hindering e-business.

Further, there was friction between China and Amazon's government, resulting in some censorship fuelled by communist regulations and laws (Wu & Gereffi, 2018). Besides, Amazon did not leverage social media platforms to enhance visibility and increase sales. Moreover, Amazon encountered aggressive competition with Alibaba and EachNet. eBay and Each Net merged to trade by the brand name eBay EachNet. The firm offers online websites, that other business entities and individuals may utilize to purchase and sell products.

On the other hand, the Alibaba group company owned by a Chinese citizen enabled the business-to-business platform concept. Simultaneously, JD.com, a straight-sale retailer, heightens stiff competition with Amazon's same approach (Pacheco et al., 2016). Finally, such challenges as geographical and financial power to operationalize from place to place posed a negative impact on Amazon to safeguard China's operations and fully innovate for sustainability. Nevertheless, Amazon had to recalibrate its competitive advantages, which entailed revamped and user-friendly websites and harnessing approaches that met consumers' tastes and preferences.

One instance of this was the payment challenge since several consumers were unwilling to pay for goods beforehand. Secondly, Amazon to get the latest technology and know-how to execute the money-on-delivery option (De Souza Sampaio et al., 2019). Besides the payment method, Amazon had to be strategic in its logistical operations by handling deliveries at home by employing workers to transport the retail. However, resolutions on payment and logistics may never be enough because of disparities in geography and finance. To achieve sustainability Amazon's accumulating incremental benefits, sudden innovations, and attaining its competitiveness in the numerical act is key (De Souza Sampaio et al., 2019).

Finally, despite Amazon's early efforts and investment, as the digital industry in China and globally keeps expanding quickly, the latest innovations may emerge obsolete before being completely executed. Thus, Amazon's approaches must remain agile with the latest challenges that are continuously evolving rapidly. Sound decision-making and proper market analysis are crucial when making an entry into a new market niche. For instance, Amazon diligently made operational decisions in its new markets in Asia, where the company invested huge from the beginning to achieve market stocks. The firm ensured its competitive strategy to sustain its market share from many market players like eBay in the Asian market.

Amazon actualized the competitive policy by being the initial organization to release the following day delivery, followed by others (Wayne, 2018). The company never started late in the Asian market, although many organizations were still developing by taking advantage of Asia countries' rapid development. China's e-commerce market is amongst the largest globally, while Alibaba controls about 75% of market shares in Asian countries through the launch of Taobao and Tmall (Wayne, 2018).

On the other hand, Amazon entered the Asian market by acquiring the Joyo.com Company, and the firm began operating under the Joyo domain. Their policy was not antagonistic like in the other new markets and very slow to positioning, despite the efforts and investments to compete, such as reimbursing customers who never expected a refund for product difference, Thus undercutting Amazon's cost by about five (Wayne, 2018) favorably. Globally, Brazil joined China and India as among the globe's biggest new markets, along with a bigger percentage of the inhabitants using a mobile phone to make payments. However, the nation has many levy codes, work laws, and other policies, making market entry procedures very difficult.

Also, the infrastructure was not conducive to the effective and efficient delivery of goods and services by Amazon. Amazon joined the Brazilian market in 2012 for the first time and launched a Kindle app after profound negotiation with Brazilian publishers who desired to control the cost in fear of aggressive discounting policies of the company (Nobre et al., 2016). The organization began offering free transportation for its Kindle goods, enhancing its reputation and confidence in service and goods delivery. Several aspects made it difficult for the company to increase its stocks in China.

Logistically, Amazon made a sensible move by establishing a delivery group for its employees. The concept succeeded as the company hired drivers who made deliveries through their cars (Nobre et al., 2016). Consequently, the company has been capable of delivering and fulfilling orders on exclusive events such as New Year, Christmas, and public holidays. Nonetheless, Amazon Company still encountered fierce rivalry. Its competitors have further invested in their networks of supplies.

Therefore, Amazon needed to distinguish itself further by rebranding its business model to increase its stock in China's market. Amazon minimized its risk and claimed its market share in Brazil by introducing the online store. Due to poor infrastructure, the company outsourced its transportation to domestic firms (Nobre et al., 2016). Amazon Company has never been demanding in its discount negotiation for obtaining manuscripts from publishers in Brazil. This policy has allowed Amazon to ratify agreements with over fifty editors (Nobre et al., 2016)

It is hard to comprehend precisely the achievement rate of developing markets as compared to developed markets. The GDP majorly emphasizes financial growth. Markets must never be perceived as emerging or emerging based on this only. A good way of measuring how much nations have advanced is one that considers socio-financial performance. The GDP as a socio-economic growth indicator is always a poor indicator of this performance (Hanrahan et al., 2019). It is, at worst unable to include any maintainable considerations and growth once the measurement occurs in non-monetary terms.

To measure the attainment in new markets, a firm must, initially, be capable of rapidly deploying its resources. Since the markets evolve quickly in the nations, organizations should be ready to transform rapidly (Hanrahan et al., 2019). Also, for a company to succeed, it has to; manage affordability by reaching the people. The company must be ubiquitous, invest in supplies, create strong company brands and durability, and finally utilize the policy and concept of playing to win and get the fights properly (Hanrahan et al., 2019). These are the fields where the firms and investors must measure success.

When joining developing markets, international companies must actively engage in domestic markets' growth instead of just adapting. Several international companies are getting their competitors in these new markets: local companies and no other international companies. Different companies offering e-commerce and home appliance services dominate in their emerging local markets like India and China (Hanrahan et al., 2019). In several scenarios, the truth that domestic firms have been outshining international firms may not be blamed on protectionist rules or one-sided rivalry.

Hanrahan et al. (2019). Offered a lot of affirmation of domestics winning in different new markets and led people to discover the reasons behind them. It was established that three major aspects for why domestic markets are the winners outshining the international companies: first, the local firms are leveraging the technologies and skills at home; second local companies may turn rapidly to consecutive shifts that mean trials by international companies in adapting to domestic market lag behind growths; third is that the domestic integration offers a dual residence group benefit. Jointly, these three aspects make the local companies a big force to be figured.

In my opinion, Amazon must diversify and enter extra new markets as soon as possible. The strategy of expansion must target new markets in parts of Africa as well as Asia. The objective of several organizations or international firms is to expand and increase their development capability globally. Thus, Amazon must leverage different new markets with an immediate effect. As evident in Amazon's success outside the American market system (Nobre et al., 2016. The Amazon Company has little presence in the new markets, particularly its online retail website, and then this demands additional investment policies adopted. These emerging market regions have a high population and offer a suitable market for goods and services (Nobre et al., 2016). The objective of conquering emerging markets is to meet the tastes and preferences of the customers. Also, diversification promotes harnessing various goods and services; thus, consumers have plenty of options to choose from. Provisions of options thus boost consumer confidence and satisfaction hence loyalty to the company.

In terms of geographical expansion, Amazon has potential due to its sustainable effort and presence in several regions worldwide like South America, Europe, the Middle East, and China. However, the company should expand its portfolio horizontally to foster its sustainability. It is perceived as less sustainable because it has never acquired companies in a similar online retail sector. The company has not merged with any industry companies since it protects its brand identity (Nobre et al., 2016). Finally, vertical expansion involves acquiring companies that might not offer similar services or work in similar industries. By vertical expansion, it will enhance its sustainability because it leverages many goods and services to sell.

Conclusion

In conclusion, Amazon has positively impacted the socio-economic well-being of most livelihoods in countries; it undertakes its operations. It has enabled prompt delivery of goods and services beyond regions, employing natives, and meeting consumers' tastes and preferences. Sound decision...

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