Amazon Diversified?

Amazon as a company is extremely diversified in the types of products they offer to consumers, but as a whole are they diversified? I believe the answer to this question is no. Amazon is an internet retail giant, but that is basically all they are involved with. They have not diversified themselves into other industries or business ventures. Being focused on a single product or industry is a common strategy among some top Fortune 500 companies, although in the long run this strategy prove less successful. Amazon has a commanding presence in the online retail industry and their diversification in product offerings will likely keep them strong in the near future. However, there might come a time in which Amazon feels the need to become more diversified in the type of industries or business they are involved with. Being diversified can offer strong long term advantages to a company. It can allow a company to weather an economic downtown or a decline in a specific industry, as well as create greater growth opportunities. It is probably just a matter of time before Amazon diversifies themselves into other segments of the retail and business environment.

Amazon's Competition

Amazon.com has numerous competitors in the segments of the retail industry they are involved in. The biggest online competitor to their business operations as a whole is eBay. eBay is probably their biggest online competitor because they are a huge company that sells virtually everything that Amazon sells. They also share a common strategy by allowing individuals to create their own product listings and sell their goods for a small fee or percentage of sales to the company. Amazon's core business practice of selling books also faces competition from numerous companies both online and offline. Some of the competitors online consist of companies such as Alibiris, Textbooks.com, and Textbooksrus. Although there are numerous competitors online, perhaps the biggest competitor in the book selling industry is a brick and mortar store. Barnes and Noble is the chief competitor for Amazon in terms of book sales, having a huge presence throughout the nation. Wal-Mart is another company that is considered a big competitor for Amazon due to their considerable presence throughout the country and on the internet. Although all of these companies are direct competitors to Amazon in one way or another, I believe that Amazon holds competitive advantages over these companies in numerous areas. I believe that they are a more reputable company that eBay or any of the online bookstores, and offer a wider range of products than Barnes and Noble or Wal-Mart.

Amazon's Business Level Strategy

I think Amazon has created a unique business level strategy that has had everything to do with their success. This strategy has led them away from being a traditional brick and mortar store such as Walmart, and led them in the direction of becoming the Walmart of the internet. Their strategy has taken advantage of the ease and constant availability of the internet and online shopping in order to become a successful business. This strategy has enabled them to not have the traditional costs that large retailers face such as construction and maintenance of stores, and at the same time, has allowed them access to every person with an internet connection. Since Amazon allows other sellers to advertise and sell products on their website for a fee, the company has capitalized on an opportunity to make money off of goods they never physically posses. This strategy allows for greater efficiency in selling goods by not having goods sitting in a warehouse waiting to be sent out. Individual sellers instead bare the responsibility of storing and shipping goods. It is obvious to me that Amazon has been using this business-level strategy to constantly innovate and be a leader in the internet retail industry.