ASSIGNMENT 5

Assignment 5



Introduction

Overview of the company

Amazon.com was one of the first major companies to sell goods over the Internet and has become a worldwide established name. Amazon.com is an American e-commerce company that is based in Washington. It was founded by Jeff Bezos in 1994 and began as an online bookstore but due to its success, Amazon has diversified into other product lines and services such as groceries, electronics and Merchant Program. Amazon.com's stock price has fluctuated in recent years from $105 in 1999 to $5 in 2001(Winter, 2010). Amazon.com has developed separate websites for Canada, UK, Germany, France, China and Japan. Amazon.com vision is to become (Amazon.com, 2007): “Earth's biggest selection and to be Earth's most customer centric company.

Discussion

Ecommerce Definition and Literature Review

Ecommerce is defined as exchange of money, information, services and products between economic entities over the internet, networks, and other digital technologies. E-commerce helps the originations to expand in local, as well as, in international market without constructing new buildings and infrastructure expansion. Through e-commerce, a customer can get information and order online 24 hours a day and 7 days a week. This 24/7 operation of E-commerce companies are cost prohibitive; however, less costly. To sum up the above definition and explanation, the constraints, such as time and space are trimmed down on the internet.

Numerous books have been written in the strategy of e-commerce; however, none of the book defines the specific issues and challenges in strategic planning of online business (Hof, 2005).

Key Issue faced by Amazon

Ethical Considerations and Values

System Maintenance

Internet Taxation

Cyber crime

E-customers and Marketing Niche

Online Communities

Feedback and Control

Privacy

Network Topology and Design

Security

Value Chain Analysis

International Web Standards

Electronic data interchange

Online Contracts and payment modules

Future Internet Trends

Legacy System

Affiliate programs

Network Implementation

Website Design

E-Marketing

Organizational Change

Site Stability

Supply Chain Management

Bench Marking Practices

Value Chain Analysis

On the basis of these key issues, there are numerous challenges Amazon is facing(Karat, et,al.,2004). Though, it is one of the best e-commerce business; however, the security system, online fraud, web crime has created challenges for the company. In addition, the free communities providing mushrooms growth of e-commerce business is the biggest challenge that every e-commerce business is facing.

Challenges

The meteoric growth of Internet based E-commerce at the turn of the last century is truly baffling. During the last one decade, this market space has grown in several directions. In its first generation, it saw the emergence of portals and search engines. However, in due course more and more organizations began to cater to the Business to Customer (B2C) market. In the last two years, there is significant growth in the Business to Business (B2B) segment. As several organizations began to operate in the Internet market space, they innovated unique propositions to create value in the process. These were either not found or difficult to replicate in the traditional brick and mortar operation (Winter, 2010). While, talking about the e-commerce business, one cannot deny the fact that it has to follow the continuous change process happening inside the IT ...