Amazon’s
weaknesses present challenges that limit its business growth and
expansion. This aspect of the SWOT
Analysis model outlines the internal strategic factors that impose difficulties
in growing or improving the business.
Amazon’s following weaknesses are most significant.
1. Imitable
business model
2. Limited
penetration in developing markets
3. Limited brick-and-mortar presence
Amazon.com
Inc. has a business model that is easy to imitate. For example, other companies can establish
e-commerce websites that sell just about anything. In the SWOT analysis framework, this internal
factor is a weakness that creates opportunities for other firms to impose
greater competition against the e-commerce giant. Amazon’s limited penetration in developing
markets is also a weakness that prevents the business from benefiting from the
high economic growth rates of these markets.
On the other hand, the company’s limited brick-and-mortar presence is a
barrier to rapidly expanding in the non-online market. Nonetheless, the acquiring of Whole Foods
Market, Amazon is on track to grow its non-online operations. Overall, the internal factors in this aspect
of the SWOT analysis impose challenges on the company, especially in terms of
growth and current new e-commerce markets.
Perhaps
there can be no better strategic option than expanding and diversifying into
the cloud-based business. As cloud computing
is set to emerge as the hottest trend of this decade and along with other trend
of the increasing usage of Big Data by marketers, Amazon can clearly establish
itself in these segments and attain market leadership position. Considering the fact that Amazon is built on
the online platform, cloud-based services would be an extension of its core
competency and would be complementary to its existing business model.
The
expansion of AWS would be in tune with the drivers of the corporate strategy as
identified earlier including the growth imperative, expansion of the customer
based through diversification, consistency with its internal resources, and
entering a market segment that is recording shattering growth rates.
No comments:
Post a Comment