Amazon Strategic Plan (2022-2025)

Submitted to
Dr. Amr Sukkar
Team Members
• Hady Yasser | 20121869
• Mohamed Tarek | 20121808
• Mostafa Mohamed Hassan | 20121714
• Khaled Mohamed Ahmed Badawy | 20122050
• Nermeen Ramzy Lamie |19121205
Agenda

01 Vision & Mission

02 Situation Analysis

Table of Contents 03 Goals

04 Strategies

05 SMART Objectives
Amazon
Existing Vision & Mission
Vision
Our Vision is To be Earth's most customer-
centric company, where customers can find
and discover anything they might want to buy
online..

Mission
Our mission is to continually raise the bar of the
customer experience by using the internet and
technology to help consumers find, discover and
buy anything, and empower businesses and
content creators to maximize their success..
Amazon
New Vision & Mission
Vision
To be the largest company that provides the best experience
to explore the entire world goods & services on real time.

Mission
We offer our customer the optimum online
and physical shopping experience with best
available selection, lowest common price
and best convenience service.
 INTERNAL FACTOR EVALUATION (IFE) MATRIX
Key External Factors Weights Rating Weighted Scores

0.0 to 1.0 1 to 4 Weights x Rating

Strengths

The ability to open multi-purpose distribution outlets. 0.12 4 0.48

The tremendous power of technological progress. 0.1 4 0.4

The possibility of expanding on different field and different 0.1 4

places. 0.4

Capacity to invest in digital and physical infrastructure. 0.05 4 0.2

Negotiating power. 0.07 3 0.21

Optimism and self-confidence. 0.05 4 0.2

Innovation Power. 0.05 4 0.2

Total Weighted
Acquisition Power. 0.05 4 0.2

Marketplace Power. 0.12 3 0.36

Score
Weaknesses

Free Shipping May affect negatively financial outcome 0.03 1 0.03 3.11
Attention to online 0.09 1 0.09

Tax avoidance controversies 0.1 2 0.2

Employee morale 0.07 2 0.14

Total 1 3.11
 E x t e r n a l f a c t o r ev a l u a t i o n ( E F E ) M a t r i x
Weights Rating Weighted Scores
Key External Factors
0.0 to 1.0 1 to 4 Weights x Rating

Opportunities

increasing product categories in online 0.05 3 0.15

E-commerce expansion in Asia (special in China and

0.15 4 0.6
India)and Africa

opening physical stores outside USA 0.05 3 0.15

increased the internet users worldwide 0.05 3 0.15

customer spending increased in online sales 0.05 3 0.15

increase market share in Apparel and footwear e-

0.05 2 0.1
commerce

increase market share in Supermarkets in USA and

0.1 2 0.2
worldwide

increase market share in Consumer electronics in USA

To t a l We i g h t e d
0.05 1 0.05
and world wide

Threats

S c o re
Competition in the global Market 0.1 2 0.2

Government Regulations 0.15 3 0.45

Business Model Imitation 0.05 2 0.1

Free Shipping May affect negatively financial outcome 0.03 1 0.03

Default of repayment for financed suppliers

Risk of expansion in the wrong country

0.07

0.05
2

2
0.14

0.1
2.72
Total 2.72
Competitive Profile Matrix (CPM)

CPM Amazon Walmart Alibaba

Weight Weight Weight
Key Success Factors Weight Rating Rating Rating
Score Score Score
Product Quality 0.09 3 0.27 3 0.27 3 0.27
Product Variety 0.1 3 0.3 4 0.4 3 0.3
Price 0.11 4 0.44 4 0.44 4 0.44
Order shipping time 0.08 3 0.24 3 0.24 3 0.24
Market Share 0.1 4 0.4 3 0.3 3 0.3
Advertising 0.05 2 0.1 2 0.1 3 0.15
Customer Loyalty 0.08 3 0.24 2 0.16 2 0.16
Brand Equity 0.03 3 0.09 3 0.09 3 0.09
Financial Position 0.09 4 0.36 4 0.36 3 0.27
Global Presence 0.08 4 0.32 2 0.16 3 0.24
Customer Service 0.09 3 0.27 3 0.27 3 0.27
Ease of Checkout 0.02 3 0.06 2 0.04 3 0.06
Distribution Network 0.08 4 0.32 2 0.16 2 0.16
Total 1 3.41 2.99 2.95
 P o l i t i c a l , E c o n o m i c , S o c i a l , Te c h n o l o g i c a l , E n v i r o n m e n t a l , a n d L e g a l

PESTEL
Political Factors Economic Factors Social Factors Technological Environmental
Factors Factors Legal Factors

-Innovative and more -Rising interest in

- Governmental -Cost of Labor Increasing online efficient ways to environmental -Rising product
support for e- buying habits transport and deliver programs regulation
commerce products.
-Changing import and
-Changes in Taxation -Cybercrime export regulations
- Government efforts
-General Data
on cybersecurity
Protection Regulations

- Criticism by US
President Donald
Trump
 5-forces of Michael Porter

Threat of Potential Bargaining Bargaining potential development

Rivalry among
competing firms - entry of new power of power of of substitute products-
high supplier-low consumer-high high
competitors-low

• The rivalry in online retail is • Due to Amazon has • The power of the consumer • The substation to
• Because this
very high this is because is coming from the products
traditional brands offer online
require extensive large sales for each Amazon are Alibaba,
item there are large should be delivered on time Walmart and brands
sales and the competitors of investment in with high quality, the
number of supplier outlet . Amazon does
Amazon are Alibaba and warehousing , switching cost to another
are ready to supply not sell anything unique
Walmart as Alibaba has 42.2% distributions , retailer is low and the
customer know that the so it faces a high threat
share of online retail in China logistics , Amazon with their
trend of online retailing is of substitution.
and Walmart has 11.6% of the marketing and products so the
increased so it is easy to get
overall retail in USA while market reputation.bargaining power of more options to go to.So the
Amazon M. share is 5.9% supplier is low against bargaining power of
Amazon. consumer is high against
Amazon.
S WOT A N A LYS I S

STRENGTHS

S
1. The ability to open multi-purpose distribution outlets.
2. The tremendous power of technological progress.
THREATS 3. The possibility of expanding on different field and different
places.
1. Competition in the global Market 4. Capacity to invest in digital and physical infrastructure.
2. Government Regulations
5. Negotiating power.

T
3. Business Model Imitation
4. Default of repayment for financed suppliers 6. Optimism and self-confidence.

W
5. Risk of expansion in the wrong country
7. Innovation Power.
8. Acquisition Power.
9. Marketplace Power.

WEAKNESSES

O
OPPORTUNITIES
1. Free Shipping May affect negatively financial outcome
1. increasing product categories in online 2. Attention to online more than physical stores
2. E-commerce expansion in Asia (special in China and India)and Africa 3. Tax avoidance
3. opening physical stores outside USA 4. Employee morale
4. increased the internet users worldwide
5. customer spending increased in online sales
6. increase market share in Apparel and footwear e-commerce
7. increase market share in Consumer electronics in USA and world wide
TOWS Matrix
S T R AT E G I C P O S I T I O N A N D A C T I O N E V A L U AT I O N ( S P A C E ) M AT R I X

Competitive advantage score Environment stability score

Distribution Network -2 barriers to entry the market -4
Global Presence -2 technological change -1
Market Share -1 rate of inflation -2
Product Variety -2 existing competing firms -2
Product Quality -2 demand elasticity -2
Order shipping time -2
average -1.8 average -2.2
Financial strength score Industry strength score
Revenue and Operating Profit 5 growth potential 6
Net Income 5 profit potential 6
debt ratio 4 financial stability 5
Working Capital (% of Revenue) 6 resources utilization 4
Cash from Operations 6
Net Income(% of equity)
average
4
5 average 5.25
x -1.833 5.25 3.4167
y -2.2 5 2.8
S T R AT E G I C P O S I T I O N A N D A C T I O N
E VA L U AT I O N ( S PA C E ) M AT R I X

Backward, Forward, Horizontal Integration, Market

Penetration, Market, Development, Product
Development, Horizontal Diversification,

Conglomerate Diversification &

Concentric Diversification
BCG Matrix
Relative Market Share

High Low

- Amazon prime Air - Luna

- E-Book - Eero
- Amazon Prime’s Instant Video - Amazon Go
- Amazon Music
- Kindle
- Diapers.com
- AmazonFresh
- Amazon Marketplace

High
- Amazon Prime Air
Relative Market Growth

- Amazon Web Services - Amazon Studios

- Alexa - Amazon Appstore
- IMDB - MyHabit
- Beauty and personal care
products
- Amazon Prim
Low
I N T E R N A L E X T E R N A L ( I E ) M AT R I X

G row a n d B u i l d
Grand Strategies

Integration strategies
 Backward Integration
 Forward Integration
 Horizontal Integration.

1.Intensive Strategies
 Market Penetration
 Market Development
 Product/Service Development

1.Diversification Strategies
 Concentric Diversification
 Horizontal Diversification
 Conglomerate Diversification
Quantitative strategic planning Matrix (QSPM)
Integration strategies Intensive Strategies Diversification Strategies
Key External Factors
Strengths Weights AS TAS AS TAS AS TAS
The ability to open multi-purpose distribution outlets. 0.12 4 0.48 3 0.36 2 0.24
The tremendous power of technological progress. 0.1 1 0.1 4 0.4 4 0.4
The possibility of expanding on different field and different
0.1 3 0.3 4 0.4 4 0.4
places.
Capacity to invest in digital and physical infrastructure. 0.05 4 0.2 4 0.2 4 0.2
Negotiating power. 0.07 4 0.28 3 0.21 2 0.14
Optimism and self-confidence. 0.05 4 0.2 4 0.2 4 0.2
Innovation Power. 0.05 2 0.1 4 0.2 4 0.2
Acquisition Power. 0.05 4 0.2 3 0.15 1 0.05
Marketplace Power. 0.12 3 0.36 4 0.48 2 0.24
Weaknesses
Free Shipping May affect negatively financial outcome 0.03 - - 2 0.06 - -
Attention to online 0.09 1 0.09 2 0.18 - -
Tax avoidance controversies 0.1 3 0.3 3 0.3 3 0.3
Employee morale 0.07 3 0.21 2 0.14 3 0.21
Total 1 2.82 3.28 2.58
Opportunities
increasing product categories in online 0.05 1 0.15 2 0.1 4 0.2
E-commerce expansion in Asia (special in China and India)and Africa 0.2 3 0.6 4 0.8 3 0.6
opening physical stores outside USA 0.1 1 0.15 4 0.4 1 0.1

Intensive strategy
increased the internet users worldwide 0.05 4 0.15 4 0.2 4 0.2
customer spending increased in online sales 0.05 1 0.15 4 0.2 4 0.2

6.37
increase market share in Apparel and footwear e-commerce 0.05 3 0.1 3 0.15 2 0.1
increase market share in Consumer electronics in USA and world wide 0.05 4 0.05 4 0.2 1 0.05
Threats
Competition in the global Market 0.13 4 0.52 4 0.52 4 0.52
Government Regulations 0.15 1 0.15 1 0.15 4 0.6
Business Model Imitation 0.05 4 0.2 2 0.1 2 0.1
Default of repayment for financed suppliers 0.07 3 0.21 1 0.07 1 0.07
Risk of expansion in the wrong country 0.05 1 0.05 4 0.2 1 0.05
Total 2.48 3.09 2.79
 Achieve 10% growth Rate

Goals increase net income 25% annually

Decrease employees turnover rate

by 50% by the end of 2025
Achieve 10% growth Rate
1) Market Penetration
•Achieve E-commerce expansion in Asia especially in China by 3.5 % every year
for the coming three years.
•Achieve E-commerce expansion in USA 3.5 % every year for the coming three
years.
•Achieve physical store expansion worldwide by 10% at the end of 2025
2) Product Development
•Increase market share of consumer electronics in USA and worldwide by 10%
sign partnership deal with one of the biggest electronic products manufacturer by
the end of 2025.
•Increase the market share of Apparel and footwear from 17% to be 20% by the
end of 2025 through aggressive marketing campaigns
•Increase the market share of supermarket specially the cashier-less
supermarket from 0.8 % to be 2.5 % by the end of 2025.
•Acquiring two online supermarket startup worldwide every year
•Add 80 % of the rest of the pharmaceutical Categories to Pharmacies by the end
of 2025
3) Market Development
•Add new payment method in which allow customers to buy their products with
installments up to 12 months without interests.
INCREASE NET INCOME 25% ANNUALLY
• Decreasing COGS by 10% through replacement Gas or Deasil Trucks with electric
once (The trucks used in shipping) in the USA by 2025.
• Maintain the same level of SG&A (Selling, General, and administrative) equal to
22.6% during the upcoming 3 years.
• Increase 10% of the Fulfillment System by Amazon per year for the Marketplace
Users.
Decrease employees turnover rate by 50% by the end of 2025

1. Employee Engagement as stockholders

10% of the company stocks will be offered to the employees with special prices annually
2. Training and development
Each employee should receive two training courses per year
3. Recognition and rewards systems
Recognition plan includes bounce ranging from 2 to 3 months annually according to
achievement for top 5 innovative ideas.
4. Work-life balance
The company will offer one free trip per year for the employees and their families and also
arrange a quarterly family gathering day.
5. Encourage Teamwork
The company will organize orientations, team building sessions monthly
6. Open Channels for Employees’ Concerns
Develop an application for employees communication and surveys to facilitate express concerns
or share ideas
THANK YOU!