Digital Marketing & eCommerce Innovation Blog

Digital Marketing & eCommerce Innovation Blog

Spotlight on Amazon

In the age of eCommerce websites, many retailers are looking to step up their game and participate in the growing trend of online innovation in a bid to drive more awareness, better shopping experiences and, as a result, their bottom line.

One giant at the forefront of online innovation is Amazon, arguably the world’s most consumer-centric online retailer. This company doesn’t just follow the trends set by other titans like Google and Ebay, this company creates its own! Read on to find out why this month we’re placing our spotlight on Amazon.

How Amazon got started

Back in 1994, Jeff Bezos was already a successful Wall Street investment banker, however, he also developed an interest in what was then referred to as the World Wide Web; so much so that he decided to create his own company. The idea behind the internet enterprise came around when Bezos was searching for new ventures to invest in and found interesting statistics that suggested world wide web usage was growing by 2,300% a month. Bezos immediately recognised the possibilities of selling online and began exploring an internet business. Just four years later, Bezos created Amazon.com. The virtual bookstore eventually became the template for how eCommerce businesses should be run, with sales of more than $610 million and more than 13 million customers worldwide.

How does Amazon stand out?

Amazon started by selling books online. However, soon after it created a whole new ecosystem of products and services. Various marketing activities and experiments elevated awareness of the brand and successfully grew the firm’s customer base & loyalty.

Amazon placed its focus on the customer shopping experience from the start by simplifying the checkout path, which was unique within the industry. Its patented 1-click checkout option dramatically shortened the buying process and simplified the shopping experience, which was especially important with the growth of mobile commerce.

This quick checkout solution is also complemented by Amazon’s “people who bought this also bought that” feature, which recommends product bundles at the bottom of product pages, not only keeping visitors on the website for longer, but encouraging them to buy more without the need to look around. Proving its significance, at one point in Amazon’s history, its recommendation engine was responsible for 35% of company revenues.

Continuing in its quest to improve the customer shopping experience, Amazon pioneered the trend for relying on customer reviews to make purchase decisions. Through written or video reviews, customers are allowed and even encouraged to leave positive or negative reviews, some of which are even verified by Amazon.

By understanding that the customer experience doesn’t end when the consumer clicks ‘buy’, Amazon keeps raising the bar for the whole industry where product delivery is concerned. It has spoiled the world by introducing free and next day delivery options that now are viewed as standard for most businesses. This is crucial when considering that a cost for delivery can determine if the shopper will buy the product from you, or from competitors who have more flexible options.

In 2007, Amazon Prime was launched, offering subscribers unlimited access to a bank of films, music and e-books, for a fixed monthly fee. Services vary from unlimited music streaming to one-hour delivery on Amazon orders for a set £79 a year. Customers that are Prime members are estimated to spend twice as much per year than non-Prime customers. This shows how important delivery and shipping options are for customers and Amazon has found a brilliant way to keep its shoppers and encourage them to spend more with various perks and benefits.

Apart from Prime options, Drone delivery is another innovative but radical idea to speed the delivery process to within 30 minutes. Amazon is one of several companies planning to make drone delivery a reality. Google has previously said that it wants to start delivering packages via drone by 2017, and in October Walmart applied to U.S. regulators for permission to test drones for delivery as well.

Amazon has determined what its audience needs, what its behaviour patterns are and as a result, the brand is definitely winning in eCommerce. However, it is also branching out into other platforms where consumers spend a lot of time and attention – namely social media. Amazon Cart allows users to add items to their Amazon shopping list by simply replying to any Amazon product tweet and tagging it with the “#AmazonCart” hashtag. The next time they log into Amazon, they waste no time hunting for the product that caught their eye on Twitter. Amazon has made the world’s largest inventory shoppable with a hashtag.

This feature works by linking a user’s Amazon account to their Twitter account, then

proceeding with the back-end fulfilment. Launched in early May 2014, the feature has gained a lot of interest with more than 157,000 tweets containing #AmazonCart sent out in under two weeks. With a similar concept in mind Twitter itself launched a ‘buy now’ option. This allows people to buy products right from a Tweet, load offers directly to a credit or debit card, and browse or shop collections of products without leaving Twitter.

Amazon also focuses on extending its eCommerce business with its own products like Kindle, Amazon’s reading tablet. People who own Kindles download the digital books, and are able to search text and annotate different sections. Through this move Amazon was able to not only establish new trends amongst book fans but also promote and sell e-books. Fire Phone was Amazon’s entry into the smartphone market, taking on Apple’s iPhone, Samsung’s mobile phones and others. Fire Phone’s notable feature was its 3-D “Dynamic Perspective”. However, it failed to offer anything that delivered better outcomes on people’s jobs-to-be-done. Amazon has since stopped its work on the Fire Phone.

Not just an online retailer

Amazon Web Services offers cloud computing services to companies. Its origins come out of Amazon’s work to optimise its internal cloud operations. Jeff Bezos decided to turn that work into a new offering. Introduced in 2006, AWS has been a tremendous success. In the 2nd quarter of 2015, AWS generated a profit of $391 million on $1.82 billion in revenue.

Amazon doesn’t strictly see itself as an eCommerce company. Or even as an eCommerce, cloud infrastructure, and online media provider. Even that narrows the company’s vision too much. Rather, it sees itself as a service platform enabled by a massive IT and logistics infrastructure. Through services mentioned above the company is set to be the world’s biggest public cloud service provider, a major online streaming service provider, a digital content seller, and a major provider of fulfilment (and increasingly advertising ) services to third-party retailers.

Conclusion

Amazon is the biggest, fastest and most innovative force shaping the way the world has been conducting commerce in the past 20 years. The company’s growth is due in part to its technological innovation and focus on customer experience. This is why we placed our spotlight on Amazon this month and will always look forward to seeing the advancements this company will bring next.

Tune in next month to find out where we’ll be placing our spotlight and, if you missed it, check out our previous spotlights on Voice Search, Whatsapp, and Twitter.

From our Blog

Keep up to date with the latest articles