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Thursday, January 21, 2010

Preparing Marketing Plans - Sample one for Amazon.com - A handy tool for strategic IT managers

Overview
Amazon.com offers Earth’s largest selection of online products. Being the #1 online retailer, it offers the most advanced and innovative ways of e-commerce that is capable to continuously deliver fastest, reliable, cheapest and most user-friendly online shopping experience for the customer.


Marketing Strategy Focus and Market Segments
Company’s mission is to become extremely customer-centric where customers can come and discover anything they want to buy online at lowest possible prices (Business Wire, 2007, April 24). The strategic focus of the company that can influence its marketing plan will thus be improving customer satisfaction via better customer-service, easily navigable website with greater focus on personalized services and learning customer behavior, expanding its international market to increase its customer base and thus annual revenues, expanding its affiliates program to increase web-site traffic and continuing to work on alliances to expand its product line to become a one-stop online retail store.


Amazon.com’s market segments are consumer-centric and are categorized based on geography, demography and customer behavior. Geography based market include the North American market and the international market. Demography based market segments targets income levels, age and sex. Behavior based market segments include existing customer bases with varied buying or selling characteristics. The key issues faced related to market segmentation are fluctuations in foreign exchange rates, global trade regulations and economic conditions, changing consumer tastes and demands, adapting the personalization services to new behavioral patterns and product expansion.


Marketing Mix - The 4 P’s
Product: Amazon.com’s product line falls under 3 broad categories - Media, Electronics and Other General Merchandise, and Others. Media includes books, DVD rentals, music etc. Electronics and Other General Merchandise includes all electronic items, toys, apparel, kitchen and house-wares, health care etc. Others includes mainly co-branded credit card programs.
Place: Company concentrates on fully online business where products will be displayed and sold directly via company’s global website versions (country specific) or through affiliates.
Price: For retaining its vast customer base, company applies Penetration pricing strategy offering lowest price possible for high quality products and services. Promotion: Company’s major mass-promotional medium will be internet itself via affiliate programs, gift cards, promotion codes and strategic alliances for cross sector product selling via partner websites, . The company can look forward to establishing a general purpose email service, similar to Yahoo! Mail and use it as a medium for advertisement.


Measuring customer satisfaction
Realization of Amazon.com’s marketing strategy and its success in e-commerce business depends on its ability to satisfy and retain its vast customer base. The question that needs to be asked is - Does the current product offerings, price, customer service and website content, search and ease of use imparts the expected value to the customer. Collecting and analyzing external satisfaction data can be successfully used to measure customer satisfaction in this case since the customer need to be heard directly in order to improve the current services. Quantitative techniques such as customer surveys, questionnaires, customer reviews and ratings and customer personalization data collected from the customer behavior on the website, can be used to measure whether the marketing goals are met.


References:
1. Business Wire. (2007, April 24). Amazon.com Announces First Quarter Sales Surpass $3 Billion, up 32% Year over Year -- Operating Profit Grows 38% -- Raises Financial Guidance. Amzn Investor Relations. Retrieved May 6, 2007, from http://phx.corporateir.net/phoenix.zhtml?c=97664&p=irol-newsArticle&ID=989711&highlight=
2. Mattern J. (2007, Feb 8). One Page Marketing Plan Template. Retrieved May 6, 2007, from http://marketing-plans.suite101.com/article.cfm/one_page_marketing_plan_template
3. Public Affairs, UIUC. (n.d.). Marketing Plan Summary: Developing marketing plans. Retrieved May 6, 2007, from http://publicaffairs.uiuc.edu/marketing/summary.pdf
4. BusinessVictoria. (n.d.). Sample Marketing Plan. Retrieved May 6, 2007, from http://www.business.vic.gov.au/busvicwr/_assets/main/lib60016/marketing%20plan%20final.rtf
5. BusniessLink. (n.d.). Marketing plan summary and introduction: Write a Marketing Plan. Retrieved May 6, 2007, from http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1075313149
6. MoreBusiness.com. (2007, May, 5). Sample Marketing Plan: AMT. Retrieved May 6, 2007, from http://www.morebusiness.com/templates_worksheets/bplans/printpre.brc

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