Amazon model initially offered customers access to massive selection without the needs to incur cost, time and stress of opening warehouses and stores and the needs for inventory handling. Amazon realized to ensure customers get a pleasant experience and Amazon acquire its inventory at reasonable prices, they need to be in control of the transaction process from beginning to the end through operating the business from their own warehouses.
Amazon’s customer philosophy can be traced from a letter extracted to the 1997 Annual Report that stated their focal points by offering customers products that they think is worth buying. Amazon tries to set apart their operations by suggesting extraordinary way in doing transaction and start by offering online books whereby they can get access to it anytime they want. Other value-added offers include 1-ClickSM shopping, customer’s gift certificates and immensely reviews, browsing options, content and suggested features. Amazon strategy focuses on reducing the price. Thus, increase the customer value. Amazon became the market online bookselling leader by encouraging customers repeating purchases through the advertising strategy that is proven effective which was word of mouth approach.
In 2002 Annual Report, Amazon has made numerous attempts so that they will remain ahead among its competitors in the industry. Among those efforts includes store personalization that cater for each customer, show customer reviews on its offering products and wide selection to the customer by placing used products next to the new products.
Amazon’s also tried to spearhead the industry by introducing the customer-pleasing traits in terms of the technology, order fulfillment and retailing strategies categories. By technology, Amazon among the early pioneer in establishing software customer data for collaborative filtering purposes. In order fulfillment, Amazon has utilized its high-tech warehouses capabilities to reduce its operation cost. Through retailing strategy, Amazon has formed partnerships with the famous retailers for instance Target and Borders Books. It is a win-win situation as its competitors-partners are allowed to offered similar items via their linked websites at their own price where it is usually a lower price.
Amazon has also developed a sophisticated technology that can capture its customer’s data all around the world. Amazon Purchase Circles still exist although it has been said to breach its customer’s privacy. The features allow the browsers to get access on the Amazon customer’s personal information such as what types of books that particular groups are reading.
How does Amazon.com’s CRM software help it to gain market share and maintain its competitive advantage?
Contemporary customer relationship management (CRM) software attributes analytical capabilities is use for the thorough data analysis. By using CRM software, Amazon can trace all the available information and use it to...