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Marketing strategies of Amazon.com in times of Recession

ABSTRACT

This paper presents the marketing proposal for an online based books retailer Amazon.com in the time of recession. Recession conditions have been studied as external shocks and its influence has been observed both opportunities for, as well as threats to, business. Companies react in defensive way by tightening the belt for slower growth during recession. However, in recession certain businesses are more affected than other; e-commerce has also gone through recession pressure as during recession online sale has been contracted in 2009 0.4% (Grau, 2009). With this decreased sale rate in online business, online retailers need to have revitalized marketing strategy for boosting the overall growth rate. This paper evaluates the possibilities for Amazon.com to survive in recession and presents marketing proposal for Amazon.com. Get homework help

Background

In economic, recession is business cycle contraction which results in slow economic activity over a period of time[1]. In recession, many macroeconomic indicators differ in a similar way and production, business profits, employment and investment spending fall during recessions. In such situation every business is affected by low economic process. With the inception of internet business concept business has become intangible but it is also affected by the recession. Amazon, since its establishment over fifteen years ago, has achieved the success depending on its ability to extend its brand position, offering its customers superb value and a greater shopping experience, and gained sufficient sales volume to realize economies of scale[2].

Amazon.com is obsessed with the mission to grow from rapidly increasing dot.com corporation into a multinational gigantic. The secret of Amazon’s success lie in its outstanding marketing strategy which has provided Amazon to change the business if Internet. Amazon offers value plan to attract its customers to shop at Amazon and distinct value plan along with lower prices, a wide range of choice, faster searching facility and reviews and convenience is the core of marketing plan of Amazon. Since Amazon is an online business and recent recession has affected other businesses it has immensely impacted e-commerce with downturn in online sales. The e-marketers have forecasted that even after stable growth in online business the current recession will lead to online sales to contract 0.4% in 2009[3].  The changing behavior of consumers for online shopping has affected the online marketing strategy.

Research Purpose

The purpose of this paper is to analyze the enhancement of Amazon in recession from 2008 to 2009. This purpose is based on the fact that Amazon.com not only survived during this period but it has also swelled. This growth of the organization is measured not only on financial basis but also on customer base and market share.

Research Objectives

   The objectives of this research paper are as follows:

  • To find the marketing strategies followed by amazon.com before 2008-09 recession periods
  • To analyze and evaluate the effects of recession on Amazon.com
  • To find the change in marketing and brand strategies during recession
  • To find and analyze the path of recovery and emerging as a survivor in the market

Theoretical Framework 

Studies have suggested that in time of recession business change their marketing strategies to attract their customers. Similarly, online marketers respond to recession by introducing economic based innovations in their marketing tactics. In addition, studies have also reported that during recession business becomes more active to create competitive advantage by gaining more market share.

Research Methodology

The research methodology adopted for this paper is qualitative approach because qualitative research associated with social constructivist paradigm and involves recording, analyzing, and attempting to discover in-depth purpose and importance of nature, contradictory beliefs, emotions, and behaviors. The qualitative research is helpful to have in-depth and complex understanding of the study. The main advantage of qualitative  is defined by Vanderstoep and Johnston (2009) and according to them,“the main advantage of qualitative research is that it provides a richer and more in - depth understanding of the population under study and that“techniques such as interviews and focus groups allow the research participants to give very detailed and specific answers.” Through qualitative research approach marketing strategy for Amazon.com will be proposed for recession.

Research Design and Methods

For conducting qualitative research previous literature will be studied using different books, journals, articles and online website for retrieving data about Amazon sales. For literature review database such as EBSCOHOST and JSTOR will be used.  Moreover, Annual reports and Financial reports official website of Amazon will be accessed.

 

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