Swot Analysis of Amazon 2021

In this quick and modernized life, we can think that offline shopping or offline transactions are time-consuming tasks for everyone. That is the reason, people are leaning towards online shopping or e-services over the internet using the web browser or the mobile app.

Day by day, the competition is extremely increasing in all company which is small or big. Every business wants to make a skyscraper using its own techniques.

The SWOT Analysis is a superior technique to know the company. The Swot Analysis Amazon is a strategic planning tool to understand the company’s Internal and External Factors.

If my question is “who is not using the Amazon App on their mobile phone or tablet?”. Obviously, most of them using it, correct!

With this post, I am going to reveal the Amazon SWOT Analysis 2021. Furthermore, before taking a SWOT analysis of Amazon, let’s see the company’s background.

An Overview of Amazon:

Today, Amazon is the third most valuable brand globally and the fourth biggest company in the world in market value. It is an American Multinational Technology Company based in Seattle, Washington, US.

Business name
Amazon.com, Inc.
Logo
Amazon Logo
Type of Company Public
Industry
  • AI
  • Cloud computing
  • E-commerce
  • Consumer Electronics
  • Digital Distribution
Founded July 5, 1994
Founder Jeff Bezos
Headquarters
Seattle, Washington, U.S.
Area served
Worldwide
Key people
Jeff Bezos
Products and Services

Echo and Alexa, Fire Tablet, Fire TV, Fire OS, Kindle, Amazon.com, Amazon Music, Audible, Amazon AWS, iMDb, Junglee, PillPack, Twitch, Whole Foods Market, Zappos.com

Revenue US$386.064 billion (2020)
Operating income
US$22.9 billion (2020)
Net income
US$21.331 billion (2020)
Number of employees
1,298,000 (Dec. 2020)
U.S.: 810,000 (Oct. 2020)
SWOT Analysis of Amazon
SWOT Analysis of Amazon

Amazon SWOT Analysis 2021

SWOT analysis of Amazon 2021 is a contextual investigation of the strengths, weaknesses, opportunities, and threats. In this SWOT analysis for Amazon, the context is Amazon retaining its position as one of the Big Four in the big tech industry.

Amazon Strengths

  • Amazon is the most popular and strongest brand in the online retail market all over the world. This strength is partly responsible for the fast growth of the business.
  • Usually, the clients would have purchased from retail stores but because of Lockdown actions, customers shift to shop online for things. So, it has increased its customer base.
  • Amazon.com Inc. is able to fight with domestic E-commerce companies through absorbing & by forming/partnering with supply chain companies, By using the tactics of “Go Global & Act Local (GLOCAL)”.
  • Moderate market diversification is also among the strengths in this SWOT analysis of Amazon. For example, the company now operates as a provider of consumer electronics, online retail services, brick-and-mortar retail services, information technology services including cloud-computing services, among others.
  • Through mainly trading online, Amazon doesn’t acquire huge costs related to running physical retail outlets. Online marketplaces also probably allow for selling more units without any rise in minimal costs.
  • The e-commerce giant recognizes that customer satisfaction can lead to repeat shopping. Artificial Intelligence is one of the technologies the company is seeking to explore, to take customer experience and the e-commerce business to another level.
  • With its strategic partners & due to its Amazon fulfillment centers, Amazon has an amazingly efficient logistics and delivery system. It can not handle a massive range of products, it also gets them delivered to customers quickly. It also has free-of-cost delivery charges in certain geographies.

Amazon Weaknesses

  • Amazon is planned to not only be online but also increase its retail store. However, the number of physical stores is limited compare to other rival companies and cannot compete with large behemoths such as Walmart.
  • It has set a goal of being carbon neutral by 2030, many argue that this is not enough. There has been a lack of environmental transparency from Amazon regarding its policy and practice of sustainability.
  • Amazon.com Inc. has a business model that is easy to copy. A few businesses are even giving Amazon a tough time. For example, Barnes & Noble, eBay, Netflix, Hulu, and Oyster, etc. can establish e-commerce websites that sell just about anything.
  • Tax avoidance in Japan, UK, and the US have sparked negative publicity for Amazon. President Trump criticized Amazon over taxes on social media.
  • Amazon is especially popular for fake ratings and reviews and that negatively affects the brand model. Few products traded under the Amazon Basics brand name are also known to be of inferior quality.
  • challenging against Amazon might be a tough fight for competitors. Amazon’s competitors are Barnes & Noble and eBay in terms of retail; Netflix and Hulu in terms of digital streaming.

Amazon Opportunities

  • Need to expand the presence of their core brand “Amazon” by partnering with leading retailers. By strategically acquiring the right companies and partnerships around the world, the global corporation can easily penetrate and expand in developing countries’ markets.
  • Amazon’s venture into food delivery is another avenue to leverage Amazon’s supply chain expertise. Zomato, India’s leading food delivery company, has expressed concerns over Amazon entering this lucrative business.
  • By opening a physical store outside the U.S. Amazon can help the customers to engage with the brand, resulting in an increase in repeat purchases & an increase in loyal customer base.
  • Acquiring E-commerce companies can reduce the competition level & also can use the specialized capacity of the other company.
  • Amazon isn’t only a leading e-commerce brand. It’s also doing excellent as a big cloud player, which shows its diversification courage. So, it’s safe to state that Amazon can expand into any sector or new technology to achieve faster growth.

Amazon Threats

  • There are lots of competitors of Amazon in the online and offline market. For example, in the area of digital streaming, Netflix is bigger than ever. As well as, Google, Microsoft, Facebook, Samsung, Toshiba, Sony, Dell, Spotify, Alibaba, Apple Music & Apple TV, Costco, eBay, Google Play, JD (Jingdong), Otto, Flipkart, Wallmart also its competitors.
  • In the early months of the pandemic, the Government of India banned the sales of non-essential goods on Amazon. Government policies also favored local retailers more than they did the e-commerce industry.
  • Amazon makes a large revenue from its American customers, compared to any other part of the world.
  • Amazon an online retailer is considered a juicy spot for any hackers. Cybercriminals threaten the security and integrity of the business, as well as customer confidence in the company.
  • Misbehavior and wages dispute towards the employees would create a negative impact for the company.

Final Words

With this blog, I hope you got all the required details concerning how the Amazon SWOT Analysis helps in understanding different aspects of the business like Strengths, Weaknesses, Opportunities, & Threats.

Thank you very much for pursuing my post. In addition, don’t forget to check out our other SWOT analysis articles on companies like Reliance Jio, McDonald’s, and Walmart.

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