Amazon Jeff Bezos in 2001. He successfully laid out

Amazon is a fortune 500
company based out of Seattle, Washington. Jeff Bezos founded the company on
July 5th, 1994, but it did not officially launch until 1995. A
report Bezos read claimed that the web commerce industry would grow at two
thousand three hundred percent, and this was his motivation for starting the
company. Not long after, a company was founded because of Bezos’ inspiration
and his keen eye for emerging markets. He left his job as vice president of D.
E. Shaw and Co. and never looked back. The company name, Amazon, was chosen by
Bezos after looking through the dictionary and falling in love with the exotic
nature of the word. Amazon’s founder had huge goals, which were finally
starting to come to life.  By 2011, Amazon had 30,000 full-time
employees in the United States, and by the end of 2016, it had 180,000
employees. The company currently employs more than 380,000 people worldwide in
full and part-time jobs. 

Amazon
surpassed Walmart as the most valuable retailer in the world by market cap in
2015. Currently it has a market cap of around five hundred and forty-six
billion dollars. The company has made its fortune off e-commerce and is one of
largest sellers over the internet. Amazon started out by selling books online
and, as time went on, people’s needs evolved beyond just buying books.  They had to add some diversity to their
company, so they chose to expand their product line to sell books, DVDs, music
CDs, videotapes and software, apparel, baby products, consumer electronics, beauty products,
gourmet food and a seemingly never-ending list of other items.  Jeff Bezos’s
globalization strategy allowed him to expand his business across the world, and
it paid off. Amazon has a different retail website for each country that
utilizes its services. The list of countries includes Ireland, Canada, France,
Germany, the United States, Japan, and India, to name a few.  

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Amazon’s successful sales model was surprisingly sketched
on the back of a napkin by founder and CEO Jeff Bezos in 2001. He successfully
laid out the foundation for a winning marketplace strategy that they would base
their entire approach on called the Virtuous Cycle. This mindset has
driven the company’s strategy since the very beginning. According to Amazon’s
founder, the virtuous cycle begins with a great customer
experience, which drives a large volume of online traffic.  Happy and satisfied customers attract more happy
and satisfied customers, and the cycle continues.  This business model allows Amazon to make
money by leveraging the power of its name, in addition to the efforts of a
third-party seller. As Amazon grew, it lowered its cost structure by leveraging
purchaseDW1 ,
fulfillment
infrastructure and logistics infrastructureDW2 ,
which subsequently lowered the cost per unit of products. The decrease in cost then
allowed Amazon to lower its prices to shoppers, continuing to satisfy the need to find the lowest price. This low price point, combined
with an increased selection, was critical to improving and maintaining the
customer experience that drives the virtuous cycle.

Amazon started by focusing on
business-to-consumer relationships between itself and its customers and
business-to-business relationships between itself and its suppliers They then
moved to facilitate customer-to-customer relationships within the Amazon
marketplace, acting as a go-between to facilitate transactions between third
party companies and consumers. Amazon allows anyone to sell anything using its
platform. Some other large e-commerce sellers even use Amazon to sell their
products, in addition to selling them through their own websites. The sales are
processed through Amazon.com and end up at individual sellers for processing
and filling orders. Meanwhile, Amazon leases space for these retailers. Small
sellers of used and new goods go to Amazon Marketplace to offer goods at a
fixed price. Amazon also employs drop shippers. Drop shippers are members or entities that advertise goods on Amazon, but
who order these goods from other websites. These meta sellers may have millions
of products listed, have large transaction numbers and are grouped alongside
other less high-volume members giving them credibility as just someone who has
been in business for a long time. Markup is anywhere from 50% to 100% and
sometimes more. These sellers maintain that items are in stock when the
opposite is true and they look to Amazon to fulfill the request on their behalf.
DW3 As Amazon increases their dominance in the
marketplace, drop shippers have become more and more common.

Amazon.com considers itself a completely customer-focused
company. The company truly believes if they don’t listen to consumers, they
will fail.  They want to take advantage
of any opportunity that presents itself. 
Amazon believes in putting customers first, and also in ownership from
its team of dedicated employees. They believe in empowering their employees, to
a point, in decision making, and giving their workers a stake in the success of
the company. 

When Amazon acquired Zappos ($1.2B), Twitch ($970M), and
Kiva Systems ($775M), they were all critical to Amazon’s strategy of expanding
their business into new and emerging markets. However, the price paid for these
companies was insignificant in comparison to the massive $13.7 billion
acquisition of Whole Foods Market, a high-end supermarket chain with over 400 stores.  Whole Foods Market exclusively features foods without
artificial preservatives, colors, flavors, sweeteners, and hydrogenated fats.
 The deal was completed on August
28, 2017 and was very effective for the company because the market for natural
food stores is soaring.  This acquisition
makes it clear that Amazon’s real
interest is in two things: the massive amount of consumer data that will become
available after the acquisition, and Whole Foods’ private brand product.  Amazon’s goal to be a superior brand that touches every
aspect of daily life appears to be coming to fruition.  With
massive amounts of data from Whole Foods shoppers, Amazon will ultimately be
able to tailor the grocery shopping experience to the individual; similar to
online data tracking. Amazon has already mastered the process of upselling
online, offering additional items that go with the items the consumer is
looking to buy. Now, with the purchase of groceries, Amazon will know when you
run out of cereal, or any other item, allowing them to present you with the
offer to buy more at exactly the right time. Amazon will also record data on customer buyer patterns,
allowing them to offer or recommend a specific items based upon customer
preferences identified through prior purchases. The customer data Amazon will have the ability to capture
will also allow them to build analytical models, used to predict what consumers
will want, how much they will want, and when they will want it. While Amazon’s purchase of Whole Foods provides them with a tremendous
amount of data, they will need to use that data to better understand their
customer’s needs and predict shopping behaviors. If they cannot do that, the
data becomes useless. If they can successfully do that, the data can be used to
maximize profit margins and minimize expenses.

In September 2017, Amazon announced plans
for a second headquarters to be located in a metropolitan area with at least a million people. By October 19,
2017, cities were to submit their presentations for the project called HQ2. The
$5 billion second headquarters, starting with 500,000 square feet and
eventually expanding to as much as 8 million square feet, may have as many as 50,000
employees. In 2020, Amazon will build a new downtown Seattle building with
space for Mary’s Place, a local charity. As Amazon’s widespread reach
extends into other markets and different areas around the world, it’s
anyone’s guess what they will do next.

 DW1Explain
this more

 DW2What
does this mean? Were they using a fulfifllment infrastructure

 DW3This
neds to be explained more/better