Marketing and Sales
Although online business had more advantage than traditional retail store about real estate locations but it had to have some centralized distribution centers that pick and pack millions of unique product combinations and ship them directly to millions of customers’ homes. Technology, process and competencies needed to run this operation differ fundamentally from traditional distribution functions.
Estimated shipping dates of Amazon were based on several factors, including destination address, how quick it could obtain and assemble items for shipment, and whether the requested of customers that it minimized the number of shipment or ship items as they became available. Amazon calculated delivery estimates time by taking its estimated shipping dates and adding the time it took a package to travel from its facilities to customers’ destination address. The ship rates were separated by domestic shipping rates and international shipping rates.
Domestic shipping rates had 3 time rates: standard shipping (3-5 business days), two-days shipping, and one-day shipping. International shipping rates were divided by continents and had 3 time rates: standard international shipping (15-28 business days), expedited international shipping (7-14 business days), and priority international courier (3-7 business days). The expenses for shipping depended on distance and time. Amazon’s deliveries were supported by many companies such as UPS, U. S. Postal service, DHL Worldwide Express, Airborne Express, FedEx, and Menlo Worldwide.
Through 1999, as the Internet continued to gather momentum, Amazon increased its commitments to new categories. As Amazon expanded, the private and public equity markets funded Internet-related companies to an unprecedented degree. After that, Amazon launched toys, electronic products, tools, software, lawn and patio and kitchen product, cell phones, and wireless services.
In addition, it expanded overseas, adding dedicated sites for the U. K. , Germany, Japan, and others. In mid-2002, Amazon’s revenue comprised of 4 categories which are 51% from U. S. books, music, video; 16% from U. S. electronics, tools, kitchen; 27% from international; and 6% from service. Not only of these items, Amazon considered more products such as apparel, which market segment at $203 billion per year (10 times of books market) and Amazon’s only apparel offering was a small selection of goods offered by zShop merchants. All of these were done to serve Bezos’s word, “We’re building a place where people can come to find and discover anything they might want to buy online”. i?? Service Most of Amazon’s revenue came from merchandise so Amazon had to invest much money to improve service for its customers’ convenience.
Amazon paid a lot of money to build out and integrate the technology that ran its Website, customer service unit, payment processing systems, and warehouse operations. For example, Amazon had made a number of innovations in customer-facing technology such as one-click buying, personalization and customization for customer. Additionally, Amazon’s technology stored customer’s address, credit information, gift recipients, and payment preferences. Furthermore, Amazon’s service supported to the third-party sellers, which were small merchants, large corporations, and its partnership.
For the small merchants or individuals, Amazon had zShop and Auctions to introduce their products in single detail page. Customers could find items by using the search box in the upper left corner of Auctions and zShop pages is simple-just enter a key word or two and they were on their ways. When customers bought from Amazon Marketplace, Auction, and zShop sellers, Amazon want customers to be safe. The condition of item customers bought and its timely delivery were guaranteed under the Amazon. com A-to-z Guarantee.
For large business sellers, most of Amazon’s commerce partnerships with large companies fell into 4 categories i. e. merchants@Amazon. com, merchants. com, syndicated stores, and marketing deals. Under merchants@Amazon. com, before Amazon set up their websites, its partners could sell their products on Amazon’s Website while still performing many of the commerce functions themselves. For merchants. com, in contrast to the merchants@Amazon. com program, the goods were not merchandised on Amazon’s site but appeared on the partner’s own, separate site.
Amazon would service this program by used its infrastructure and technology such as distribution centers and fulfillment functions. About syndicated store, like it merchants. com program, but this program charged Amazon with responsibility for all product development and operational tasks in support of the Website, including buying, stocking, pricing, shipping, and servicing product. Finally, marketing deal, Amazon promoted its partners’ products or services on its Website and, in some cases, allowed its customers to click over to its partners’ Websites.