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Jeff Bezos Research Paper

485 Words2 Pages

After reading about Jeff Bezos and his success in the digital age, I wondered; why would he be interested in purchasing Whole Foods, and how does this relate to his success with digital media? I located an academic journal published in October 2017, by a professor at the MIT Sloan School of Management. Professor Cusumano offers some statistics and facts about the grocer, and Amazon, some quotes from Bezos, and some insight into the driving force behind Jeff Bezos’ acquisition. That said, this source is relevant, credible, accurate, and unbiased, and paralleled with what was presented in class reading and viewing requirements. In June 2017, Amazon acquired Whole Foods, a national grocery store chain, for $13.7 billion dollars (Cusumano, 2017). For …show more content…

24). Cusumano pointed out that Amazon “was never a completely virtual business” (p. 24). He went back to his roots. We know that Bezos produced his own products, such as; Kindle, and more currently, Alexa, the digital assistant; however, even with the low overhead of e-book technology, Amazon recently "opened a bookstore in Seattle to compliment the online store" (p.25). So why get into the grocery business? Seemingly, the same reasoning: to expand the digital with brick and mortar. According to Cusumano "Bezos interest in groceries goes back a decade, when he launched Amazon Fresh. Why? Volume" (p.25) Bezos knew “the grocery business in the U.S. alone was worth over 3 trillion dollars” in 2016 (p,25). If Amazon and Whole Foods teamed up, they would enjoy a “3.5% market share" (p. 25). Akin to ad-sharing on the internet, Amazon and Whole Foods could have cross- over appeal to their consumers. “Perhaps Amazon can convert Whole Foods customers to Amazon Prime members, and Amazon could

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Moreover, Bezos could re-train shoppers to buy produce and meats in person, while purchasing everything else on line. Furthermore, Amazon has a subscription service that is already selling this way, making it easy to see how gains in non-perishable sales could mirror the market gains that Amazon realized in the book trade (41% today according to LA Times). Yet another hypothesis, is that Bezos may simply be looking for consumer data. For example, grocers collect very sensitive data on their customers, in the same manner that Amazon does, combining this information would give the on-line retailer a powerful weapon with which to beat competitors. Privacy then becomes a major concern, with the possibility that data gleaned from consumers ' Amazon accounts would be shared with Whole Foods and visa versa.

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Purpose To be an innovative grocery store by providing friendly service, clean stores, quality merchandise, and speedy check-out lanes throughout our locations. Vision To provide excellent customer service that exceeds expectations while building long-term relationships with customers.

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This is behind the reason as to why Mr. Cornell has visited a number of firms such as Pepsico which are thriving well in the grocery industry (Ziobro, par.5) On top of that, the article presents that, Mr. Cornell is also focusing on hiring an experienced executive who will help the entity to execute this objective (Ziobro, par.6). Meanwhile, the article has also outlined a number of reasons as to why venturing in the grocery industry by Target will be important. Some of them include focusing on the young people and attract more customers. The article has also mentioned the target population of the intended increase of grocery stock by Target Corporation.

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With new competition entering the grocery market Publix’s competitive advantage of product quality is diminishing. To maintain and maximize profits Publix needs to find a new competitive advantage. One such competitive advantage is their specialty departments primarily the deli. The way that Publix can achieve this is by marketing their deli more as a place to eat, and even one day as its own standalone restaurant like Subway. By branching out being a more proactive organization or one that “monitors trends, identifies the future needs of existing customers, and anticipate changes in demand” (Dees, McNamara and Eisner, p. 404).

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According to Amy Koss in a Los Angeles Times opinion piece, Amazon.com is a “21st century deal with the devil”. Koss believes such online retailers such as Amazon.com looks good on paper but in reality, are harmful to local retailer mom and pop stores, and equally harmful to the titans of the retail world, such as Sears, Macys, Radio Shack, and Men’s Warehouse. Koss states that the “Satan” of today relies on easy consumption to win our souls. Koss then goes on to explain how Amazon hooks the masses into its vast online catalog of everyday items, most of which are unneeded, but has them radially available in a sleek looking web page layout that turn the laziness and greed of the masses to their wallets to buy everything they could every want

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Amazon is an incredibly large and successful company, which has recently become the third largest retailer in the world (Gensler). Despite being such a large company, Amazon has not dabbled very much in brick-and-mortar retail, besides their very recent purchase of Whole Foods. Since Whole Foods is a grocery store and they have many freestanding stores, it is easy for Amazon to introduce new features that can be successfully implemented because of their overlapping markets and accessibility, whereas Lululemon relies on mall traffic and a smaller market. It is difficult for many to be a part of the clothing retail industry, since it is such a highly competitive industry that can change at the drop of a hat. Especially for a company like Amazon; that has only operated online until very recently, it would be much more difficult for them to penetrate this new market and keep Lululemon afloat.

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The company’s business environment, which is the organic and natural food industry, has a high number of existing competitors, who aggressively compete based on service, quality and price; the fact that switching costs for consumers to shift to other retailers are significantly low contributes to the strong force of competitive rivalry. (Strategic direction: differentiates products based on high quality) Strong Force of Bargaining Power of Customers Consumers of Whole Foods Market have strong bargaining power regardless the weak force of small volume purchases compared to the total revenues of the company. The majority of Whole Foods Market’s target customers is individual buyers who have access to product information they can use to compare with other retailers. If Whole Foods Market fails to satisfy

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Furthermore, research has shown that there is a high percentage of overlap between Amazon Prime and Costco membership holders. Should Amazon take over the grocery marketplace, Costco could see a serious decline in

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Victor Gruen invented the shopping experience that we take for granted today with big department stores sharing the mall's space with small retailers and creating a ‘cooperative capitalism’ that benefits everyone overall (Gladwell, 2004). Amazon bought this same approach to offline retail to online by creating an ecosystem of products and services. Amazon’s primarily early advantage was in the 1992 Supreme Court ruling in Quip vs North Dakota that stated “the lack of presence in a state was sufficient ground to exempt a corporation from pay sales and use taxes to a state” (Taplin, 2017).

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Focusing on the needs of the buyer is also a focus of the firm, they can create products that specifically cater to the needs of their customers. This can be seen when the begin rotating season goods for their customers or bringing in more natural foods due to trends involving customer fitness and eating healthier foods. This strategy is appropriate, this was the firm’s original strategy when it was founded in the late 60s, and it hasn’t changed all that much. The corporate-level strategy resembles that of an organic growth strategy. Rather than opting for an external approach and follow say an Amazon by acquiring Whole Foods to enter the business, Trader Joe’s has followed an internal approach for their corporate-level strategy.

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In just a month of its establishment Amazon was selling books to all 50 states of the US and Canada. From the onset the company had ambitions of being an “everything store” (funding universe, 2004). Over the years Amazon increased its offerings to include DVDs, electronics, furniture and other consumer goods (Amazon.com, 2015). The product range increase was accompanied by a series of acquisitions. Oliva et al (2003) describes Amazon to be using a get big fast (GBF) strategy which is premised on keeping prices low while expanding market

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Amazon’s major guide has been its strategy for low cost and effective innovations gaining advantage over its competitors. Amazon’s established strategies can be deemed suitable and successful and thus making it dominating player in the market. This dominance may very well continue as Amazon explores new innovative products and

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Inc., n.d.). In 1994, when Amazon was founded it was running out of the founder Jeff Bezos’ garage, making $20,000 per week in profit. Recently in 2014, Amazon has acquired the title of “The Everything Store” with 154,100 full time employees working for it, and it earned $90 billion in revenue. Amazon has broadened its market by allowing sellers to sell their new and used items along with Amazon products, giving customers the option to choose a product that matches their affordability (shorr,

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