Amazon

Amazon is an American multi national e commerce company focusing on e-commerce, cloud computing and artificial intelligence. It has been widely considered as one of the most influential technological and cultural forces in the world.

Amazon was founded by Jeff Bezos from his garage. Since then, it has entered into multiple categories and products. It virtually has all the mainstream products available on its website and got a moniker the everything store for it. Amazon is the world’s largest online retailer and marketplace. It is world’s largest internet company in terms of revenue and second largest employer in United States of America.

Amazon also distributes variety of downloadable and streaming content through its Amazon prime, amazon Music and Audible platform. Amazon is also involved in publishing of books and is also owner of a production house MGM.

History of Amazon

1994-2006 – early years of Amazon

• Amazon was founded on July 5, 1994, by Jeff Bezos, who chose the Seattle area for its abundance of technical talent, as Microsoft was in the area
• Amazon went public in 1997
• Amazon launched Amazon web service in 2002 which provide APIs on top of Amazon E commerce platform
• In 2008, Amazon launched Fulfillment by Amazon practice, which allowed third party seller on Amazon to utilize storage facilities of amazon for online delivery

2007- Present – growth years of Amazon

• Amazon purchased Whole food markets in 2017
• Introduced hazard pay policy during Covid

Amazon products and Services

Amazon.com

Amazon.com is an ecommerce platform that sells many product lines, including media (books, movies, music, and software), apparel, baby products, consumer electronics, beauty products, gourmet food, groceries, health and personal care products, industrial & scientific supplies, kitchen items, jewelry, watches, lawn and garden items, musical instruments, sporting goods, tools, automotive items, toys and games, and farm supplies and consulting services. Amazon.com attracts 2 billion page views per month on its website.

Amazon.com is available in local domain in more than 20 countries of world including India, USA, Turkey, China etc.

Merchant Partnerships

Amazon has entered into multiple contracts with merchants in field of consumer durables, garments, video gaming and sell these merchant’s product on its ecommerce store. However, Amazon.com has run into multiple conflicts and cases with these merchants due to perceived unfulfillment of services.

Private Label products

Amazon sells many products in different categories such as mobile, chargers, daily essentials under its own brand name. White label products account only for less than 1 percent of overall sale on Amazon.com

Third party sellers

Around half of annual revenue on Amazon come from third party seller. These sellers displays their product on Amazon.com and portal charges a fixed fee for displaying these products. If third party seller also avails Amazon fulfillment facility then Amazon also charges certain fee on that too. Apart from millions of small sellers, many big brands also avail facility provided by Amazon.com to sell their products apart from Amazon.com. On checkout, Amazon.com directs to these websites and fulfillment is done by these websites on their own

Affiliate program

Publishers can signup as affiliates and receive a commission for referring customers to Amazon by placing links to Amazon on their websites if the referral results in a sale. Worldwide, Amazon has “over 900,000 members” in its affiliate programs. Amazon Affiliate program is used by more than 1-2 % of overall websites on the web.

In June 2010, Amazon Seller Product Suggestions was launched to provide more transparency to sellers by recommending specific products to third-party sellers to sell on Amazon. Products suggested are based on customers’ browsing history

Product reviews

Amazon allows users to post product reviews on Amazon.com. Amazon is the single largest source of product reviews on internet as of today. Amazon allows both positive and negative review on its portal.

Amazon Sales rank

The Amazon sales rank (ASR) indicates the popularity of a product sold on any Amazon locale. It is a relative indicator of popularity that is updated hourly. Effectively, it is a “best sellers list” for the millions of products stocked by Amazon.

Amazon sales rank is not published for outside use. However, certain agencies and companies have come out with tentative Amazon sales rank on their own.

Physical Stores

In November, 2015, Amazon started a Amazon Book Store in University Village in Seattle. Amazon is planning to open more physical stores going forward.

In September 2021, Amazon announced the launch of Astro, its first household robot, powered by its Alexa smart home technology. This can be remote-controlled when not at home, to check on pets, people, or home security. It will send owners a notification if it detects something unusual.

Subsidiaries of Amazon

Amazon holds more than 40 subsidiaries including Audible, Diapers.com, Amazon Web services, Goodreads, IMDB etc

Amazon Web Services

Amazon Web Services (AWS) is a subsidiary of that provides on-demand cloud computing platforms and APIs to individuals, companies, and governments, on a metered pay-as-you-go basis. Amazon Web Services has more than 33% of market share of cloud infrastructure which is significantly more than next two competitors Microsoft Azure and Google Cloud

Audible

Audible is a seller of digital content in audio format and sells digital audio books, radio and television programs, audio versions of magazines and television programs. Amazon bought Audible in 2008 by paying out record 300 million USD in 2008.

Goodreads

Goodreads is a “social cataloging” website founded in December 2006 and launched in January 2007 by Otis Chandler, a software engineer, and entrepreneur, and Elizabeth Khuri. The website allows individuals to freely search Goodreads’ extensive user-populated database of books, annotations, and reviews. Users can sign up and register books to generate library catalogs and reading lists. Amazon bought Goodreads in 2007.

Ring

Ring is a Home automation company and manufactures devices such as security cameras and Amazon bought Ring in 2018

Twitch

Amazon acquired Twitch in 2014. Twitch is a live streaming platform that develops and stream video gaming contents. It has million of broadcasters and 100 million monthly web users.

Whole Food Market

Amazon acquired Whole Food market in 2017, Whole Food Market is an American super market chain that features food without preservatives, flavors and sweeteners.

Other Amazon subsidiaries includes-

•  A9.com
• Amazon maritime
• Amazon Pharmacy
• Annapurna labs
• Beijing century Joyo courier services
• Brilliance Audio
• Comixology
• Souq.com

Amazon Operations

Logistics

Amazon branded services to deliver a package includes-

• Amazon Air that is a Buk based cargo airline
• Amazon flex that allows independent individuals to act as an Amazon delivery agent to deliver packages in amazon prime and that of Amazon.com
• Amazon Logistics, which includes small business operating fleet of private vehicles to deliver packages to customers. currently, Amazon India doesn’t provide this facility

Supply Chain

Amazon first launched its distribution network in 1997 with two fulfillment centers in Seattle and New Castle, Delaware. Amazon has several types of distribution facilities consisting of cross-dock centers, fulfillment centers, sortation centers, delivery stations, Prime now hubs, and Prime air hubs. There are 75 fulfillment centers and 25 sortation centers with over 125,000 employees. Employees are responsible for five basic tasks: unpacking and inspecting incoming goods; placing goods in storage and recording their location; picking goods from their computer recorded locations to make up an individual shipment; sorting and packing orders; and shipping. A computer that records the location of goods and maps out routes for pickers plays a key role: employees carry hand-held computers which communicate with the central computer and monitor their rate of progress.

Amazon also provides Amazon fulfillment centers to its Amazon India small sellers all across India. Fulfillment by Amazon or FBA facility can be availed by sellers located mostly in metro cities such as Delhi, Bangalore, Chennai and Mumbai