Amazon Kindle Marketing Analysis

2000 words - 8 pages

In this chapter the researcher is analysing the empirical findings by applying the theories of literature review. Consequently, this chapter will be helpful for writing the recommendations and solutions.

4.1 Porter’s Five Competitive Forces Analysis:
The manufacturing process in online book industry is relatively simple despite deploying a highly modernized technology which means to have fewer entry barriers. Moreover, the pages made by E Ink Corporation are electronically displayed on Amazon Kindle like in Sony e reader, irex, iPod etc. In this regard there is a huge challenge to persuade more book publishers so that more books can be accessed on the Kindle. However, due to being immature the E-book industry is facing uncertain pricing standards in the market and there is too much price distinction exists with respect to different models of e readers but the prices of Kindle is relatively higher than its other rivals such as Sony, Apple etc. Apart from that the e-book industry has been receiving very low customer support and the manufacturers are instead of growing their businesses always seeking to steal others customers. The bargaining power of supplier is mainly obtained from the accessibility to substitutes, number of suppliers, and the switching expenses to other inputs. Therefore, the Amazon Kindle involves two major inputs such as screen and system technology. E Ink Corporation develops the technology for the display of electronic screen on Kindle and for many other e readers. As the electronic paper is quite new in market which means there are not so many substitutes and firms in this field. Furthermore, it means E Ink possesses very little supplier bargaining power with respect to Amazon Kindle which might be changed in future based on the level of advancement reveals in electronic paper technology and the reputation of Kindle. The Kindle users do not pay any connection charges/fee because Amazon itself pays it but the coverage of kindle is relatively very restricted. However, the bargaining power of book publishers is extremely noteworthy because Kindle is worthless in the absence of e-books. Amazon takes approval from publishers before converting their books and for one title of book there is a strong amount of monopoly exists among different book publishers and which means Amazon has to pay them monopoly charges. In this context the book publisher causes an influence on the bargaining power of supplier because of having the authority as which book should be accessible on the Kindle. Moreover, the book publishers can also restrict the Amazon to convert their books for avoiding any unlawful copying. The bargaining power of Kindle users is very low and it is obtained from the worth of an item for a buyer and the convenience of changing to another competing item. Therefore, the Kindle and other e reader manufacturers have to comply with the Digital rights management system which safeguards the available e-books of not being...

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