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Amazon's mission is to be the world's greatest e-commerce hub, letting consumers easily access an extraordinarily wide range of goods. Situated at the cutting-edge of online retail since its inception, Amazon not only seeks to retain its position as the world's largest retailer, but to change the way people shop.


In 1994, determined not to be left out of the dot-com boom, Jeff Bezos founded Cadabra in an attempt to break into the burgeoning world of e-commerce.

Recognising the global demand for literature, Bezos' company focussed initially on selling books. Bezo's key insight was that by operating as on online bookstore that connected customers directly to book suppliers, his company would be freed from the constraints of limited warehouse size, and would be able to stock several times more titles than traditional brick-and-mortar bookshops, as well as offering cheaper prices.

Within a year, he re-branded his company as Amazon, and by 1997, its shares were already being publicly traded on the NASDAQ. Some investors were initially frustrated by Amazon's intriguing business plan, whereby no profit was expected to be made for at least four years, but such reservations were allayed when, in the year 2000, as many of its competitors were folding as the dot-com bubble burst, Amazon continued to grow. By 2001, Amazon proved the sceptics wrong and was indeed turning a profit, which, while modest, proved the viability of Bezo's business model.

From there Amazon went from strength to strength, and since 2001, Amazon share prices have sky-rocketed, almost year-on-year, as the company expanded globally, engaged in a series of high profile acquisitions, branched out into other areas of retail and established their reputation as an e-commerce behemoth. Amazon has continued to innovate their field, cementing their status as a retail giant with such ventures as Amazon Prime, offering regular customers free express shipping for an annual membership fee.

Amazon has also ventured into consumer electronics, releasing the Kindle range of e-book readers and tablets. While the Kindle e-book readers were heralded upon their initial release as highly innovative products, later models of Kindle tablets have not enjoyed the same degree of success or market share.

Amazon's driver to diversify their business activities has seen them develop revenue streams from digital media, offering consumers access to films, music and games. In 2007, Amazon even entered the world of online grocery delivery, opening AmazonFresh, to cater for American customers. In 2010, Amazon branched out into film and television production, opening Amazon Studios to produce original content for their online streaming services.

Despite their increasingly varied business operations, the majority of profits still come from online retail, where Amazon continues to occupy a globally dominant position as the largest shop in the world. In 2015, Amazon achieved a significant milestone in the form of becoming the largest retailer in the USA in terms of market capitalization, finally outperforming their brick-and-mortar rivals Walmart for the first time.

Amazon continues to demonstrate a commitment to innovation and changing how we shop, with perhaps the most exciting and revolutionary service currently in development being Amazon Prime Air. This service, set to roll out in the very near future, will see Amazon offer a half-hour delivery service using flying drones. This is merely the latest chapter in Amazon's story of continual innovation in retail. Amazon shows no sign of slowing down, with its sheer size, market share and the resources at its disposal making it uniquely positioned to revolutionise the ways in which we consume all manner of goods in the future.

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Customer Segments

Amazon appeals to a mass market. Rather than targeting any specific demographics, Amazon's  accessibility and sheer variety of physical and digital products mean that virtually anyone with an internet connection is a potential customer. Whether it's physical goods or digital media they are after, Amazon has something to offer most consumers.

Amazon also has a loyal core customer segment, reportedly comprising tens of millions of people globally, in the form of its Amazon Prime subscribers, who pay an annual subscription fee for free express postage and other perks.

Value Proposition

Convenience, competitive pricing, brand recognition, and the sheer range of goods stocked are all central to Amazon's value.

The ease with which consumers can buy a wide range of goods on Amazon is an important factor in Amazon's success. Consumers know that Amazon is a well-stocked, competitively priced, safe, reliable and efficient platform for shopping, so they keep coming back. This is illustrated by one survey which found that 44% of American consumers said that, when shopping, they would go straight to Amazon to search for what they want without even looking at other websites. No other online retail platform can boast quite this level of ubiquity, and this is an essential part of Amazon's value.

Founder Jeff Bezos emphasises that the Amazon brand has been central to the company's success. Noting that “there's nothing about our model that can't be replicated”, he claims that the brand name “Amazon”, connoting ideas of something exotic, diverse and huge, has itself been key to the company's success. Amazon has many e-commerce rivals, but few enjoy anywhere near the same level of global brand recognition. Everyone has heard of Amazon, and so for many, it is the first place they look when they want to buy something.

As Amazon developed and branched out into digital media streaming and the sale of ebooks, exclusivity has become an increasingly significant value proposition. These days AmazonStudios even creates original TV shows and movies which form a modest, but growing part of Amazon's total value.


Amazon's largest channel is its website It also maintains fourteen different versions of its website for customers from various countries across five continents. Products are also purchased through the Amazon smart-phone app, which functions as an increasingly important sales channel.

Many third-party electronics stores stock Amazon's Kindle range of consumer electronics, providing an additional channel.

Customer Relationships

Making online shopping and the purchase of digital content easier for consumers has long been a focus of Amazon. Because of this, Amazon enjoys long-term relationships with millions of consumers worldwide who keep returning to Amazon time and time again to buy more products. They enjoy a particularly close relationship with their Amazon Prime subscribers, who, having paid their annual subscription fee, are likely to consistently use Amazon as their first port of call for online shopping. offers a high degree of user interactivity. Shoppers may review purchases and place comments on nearly every page. Because of this, Amazon is sometimes referred to as not only the world's largest retailer, but also the largest online community.

Amazon invests heavily in customer service. To ensure higher levels of customer satisfaction, they offer 24-hour customer service via email, phone or web-chat, as well as providing help forums where users may seek advice from the community.

Key Activities

Merchandising – of physical and digital goods, is clearly a key activity, but in the last decade, Amazon has invested substantially in production of digital content through Amazon Studios, and consumer electronics under the Kindle brand.

Key Resources

Amazon owns numerous physical resources such as warehouses and film studios, but Amazon's technological infrastructure is also a key resource. In addition to owning many digital content streaming platforms they are also the world's largest provider of cloud infrastructure services via their subsidiary, Amazon Web Services.

Amazon's sophisticated technological infrastructure is a valuable key resources that is essential for the day-to-day functioning of its business. For example, Amazon operates some of the largest databases in the world, which they use to, among other things, keep records on customers' consumption habits in order to engage in more efficient merchandising. In the era of “big data”, this is not an asset to be underestimated.

Key Partners

Manufacturers, third-party sellers, publishers and digital content producers are all key partners in Amazon's operations.

Manufacturers of the physical goods that are stocked in Amazon's warehouses are the obvious key partners. However, not all physical goods sold on Amazon are stored in their own warehouses, and a substantial percentage of revenue comes from third party sellers who Amazon allows to operate on their online platform.

The people who own the intellectual property that Amazon sells via the Kindle ecosystem and streaming platforms are also key partners.

Cost Structure

Amazon's main online retail activities are cost-driven, meaning that they operate on a model whereby economy of scale is important. Warehousing and distribution comprise Amazon's most significant cost drivers as the company operates a large number of massive warehouses globally. Amazon is working on driving these costs down by automating warehouse processing and delivery where possible. Other significant cost drivers include the running of numerous software development centres and customer service centres around the world.

Another key cost driver is the initial cost of purchasing the goods they sell, however they are able to stay competitive in this field by economies of scale.

Amazon's intellectual property assets are value-driven, with the kindle ecosystem and Amazon's various streaming services operating on the principle of creating value rather than minimizing costs.

Revenue Streams

Online retail remains Amazon's largest revenue stream. Amazon stocks a huge range of physical products, the online sale of which still accounts for most of their revenue. Further revenue is made by taking commission from third-party retailers who use the Amazon platform.

Sale of E-books and streaming of digital content has been a growing source of revenue for Amazon over the last decade.

Other, smaller revenue streams include the Amazon Prime subscribers' fee, and the sale of Amazon's own Kindle range of electronics.

Our team

Jeffrey P. Bezos,
President, Chief Executive Officer and Chairman of the Board

info: Bezos studied electrical engineering and computer science at Princeton, graduated summa cum laude and went on to an eight-year career on Wall Street, before founding Amazon in 1994. Amazon's founder remains at the helm and retains an 18% stake in the company.

Jeffrey M. Blackburn,
Senior Vice-President, Business development

info: Holding an MBA from Stanford's Graduate School of Business, Blackburn was assistant vice-president at Deutsche Morgan Grenfell before joining Amazon in 1998, serving as Vice-President, Business Development, and Vice-President, European Customer Service and Vice-President, Operations Integration before assuming his current role.

Andrew R. Jassy,
CEO Amazon Web Services

info: Holding an MBA from Harvard Business school, Jassy runs Amazon Web Services, a subsidiary that sells cloud-based infrastructure services to businesses and software developers.

Brian T. Olsavsky,
Senior Vice President and Chief Financial Officer

info: After acquiring an MBA in finance from Carnegie Mellon University, Olsavsky held various senior management roles at Fisher Scientific before joining Amazon in 2002. In his current role he is responsible for the company's overall financial activities.

Diego Piacentini,
Senior Vice President, International Consumer Business

info: Holding a degree in Economics from the Bocconi University of Milan, Piacentini was the General Manager of Apple Computer Europe before joining Amazon in 2000.