438016461 Amazon Go Marketing Plan PDF

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Amazon Go marketing plan

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Introduction Marketing strategy is a road map which highlights the path to achieve business objectives and goals. Before creating a marketing strategic plan, a detailed market research is required which helps the business to identify resources and opportunities for increase in sales. Business have to plan and execute an effective marketing strategy in order to maintain the coordination of business activities. Organisations can extend their business through an effective marketing plan with respect to internal and external issues of the state. In-depth Analysis of competitors helps the company to make decisions for actions that will be developed by communication across the company, by a valued plan that will be beneficial in competition. An effective marketing plan is more important for new businesses entering in a market or established recently as compare to the businesses established already. The report presents the strategic marketing plan for Amazon Go by using some frameworks which includes PESTLE analysis, SWOT analysis, Porter’s Model, SMART strategy and marketing mix in order to create the most effective plan.

PESTLE analysis PESTEL analysis, is a framework used to analyse the factors of market environment and constraints that may have effect on the performance of business. Countries have different laws and norms in a globally operating industry. For retail industry manufacturers, it is difficult to enter in market with new strategy with already existence of high potential businesses. Environment plays a vital role in establishment of new businesses and it is a constant threat for businesses running globally. PESTEL stands for political, economic, social, technological, environmental, and legal issues which is very helpful for new businesses entering in a global market. To perform a PESTEL analysis for Amazon Go is an essential step before opening a new market in UK and this analysis will help it to know about the internal and external factors of business. Following is the PESTEL analysis of Amazon GO.

Political The political factors are all about how and to what degree a government intervenes in the economy. Amazon Go can be effected by the several policies of Political stability of the area which can affect the supply chain of the business. One of the factor can be a new impose of tax by government which affects the whole revenue generating structure of business. As Amazon Go is offering food products, they must be comply with health guidelines proposed by the government in order to avoid the legal troubles.

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Economic A stronger economy allows consumers to buy products they want. Rather than just buying products they only need. But now a days’ people prefer not to waste their money on unnecessary products as the expenses to live an average life in UK has increased, the economic factors for Amazon Go are employment, wages, and consumer confidence, and according to global economic scenario, there is prediction for retail industry to grown up to 23$ trillion by 2020 which will be beneficial for Amazon Go. Social The factor demonstrate the demographic characteristics, norms, customs and values of the population within which the organization operates. In UK socio- cultural is most of the population is tech friendly and this is a great strength of Amazon Go’ automated store. Social factor also involve the feedback system and Amazon Go can collect data provided by their customers to see which

products people are buying, leaning towards, or completely ignoring. Then, they shape their offerings based on this data. It’s a never-ending process. Technological The factor concerns with the innovation of technology which can affect industry’s operations and a deep analysis of current market’s technological awareness. As the Amazon GO is introducing new idea of automated store which involves sensors and latest visual reality concepts which can generate difficulties like product is not properly charged, smartphones compatibility, and wrong detection of sensors. Amazon Go have to perform deep analysis of technology which has to be implement in order to be safe from these bugs and system errors.

Environment The environment factor has become so important due to the increasing scarcity of raw materials, carbon and pollution targets. Amazon Go is offering ready to eat food products and for that a maintained temperature and pollution free environment is very important, Amazon Go has to use blockchain technology which allows manufacturers to input information about food products in real-

time. Amazon Go also cannot forget about environmental issues inside of the stores either in order to meet the environmental requirements for customers. Legal There are some laws for Country’s business environment and some company’s policies. Legal analysis performed with respect to both angles. The store without man force can put the store’s security at stake. It can be the source of attraction for shop lifter. And security of the customers can also a threat for Amazon. The legal authorities can block the business if the customer security is at risk and proper security measures not provided by Amazon. 3

Porter’s 5 forces Porter’s model is a framework which use to analyse the competition level with in a market. This strategy will really help the new businesses to enter in an industry. Competition level does not only increase by competitors, but depends on 5 basic forces. These forces collectively determine the business’s profit and success. If the five forces are intense then the company is going downwards and if the five forces are mild than the company is getting higher returns. The challenges which Amazon Go might face will cover by this framework. By proper utilization of Porter’s 5 forces, Amazon can save lot of expenses and also helps in development of marketing operational policies.

Threat of new entrants For Amazon Go, the chances of new entrants is very low because of the new and innovative idea of automated store. If a new player will enter in market with the unique or better idea as compare to Amazon Go than it will going to face the challenge. Researches should be done by Amazon Go in order to avoid the threat of other new companies.

Bargaining power of suppliers This force helps to analyse power of company’s supplier over the potential to increase its price and reduce the quality of product. The factor is applicable in concept of Amazon Go as it will be the new company in the market and companies that are well known globally are already signed the agreements with suppliers and stable enough to set the product’s price with higher profit. For Amazon Go this will be a difficult task to maintain the cost of product at initial stage of business and revenue of the company can be go down at starting.

Bargaining power of buyers This force analyses the customer power which can put company under pressure. The customers are in power when there are too many alternatives for them to buy from. In Amazon Go case, it would be difficult to gain customer satisfaction because other companies already providing products at same price. In order to attract maximum population, Amazon Go has to provide the best price product to the customers according to the rates of market because its human nature he will always buy from those who are selling goods in lower prices than others.

Threat of substitute products As the main focus of Amazon Go is on selling ready to eat food items and grocery items and many existing companies are already selling them so it will be a challenge for Amazon Go to sell products in a unique way as Amazon Go is introduced the idea of no queue system which will attract the customers to buy ready to eat food from them. 4

Competition among existing competitors The last force determines the level of competition with already existing businesses in market. This helps to analyses the number of competitors and their capabilities. For Amazon Go the chance of competitors is very less due to new concept of automated store and in existing market there is no company exist which follow this strategy so for Amazon Go this new concept may help the to stand out in market.

SWOT analysis SWOT analysis is the tool use for survey of how different factors are showing impact on business and to analyse if the impact is positive or negative. SWOT is an acronym which stands for Strengths,

Weaknesses, Opportunities, and Threats. SWOT analysis helps the business to make better decisions with confidence. Amazon Go can find out the most effective ways to plan, execute and maintain the processes by performing SWOT analysis and can have a deeper understanding of company’s position in market and it will also be helpful for Amazon to optimize the time for planning and improve execution results. The SWOT analysis for Amazon Go is discussed below

Strengths: The main strength of Amazon Go is its unique idea of automated stores with no checkouts which is the main point to get the focus of maximum customers. Furthermore, Amazon is one of the world’s leading ecommerce company and famous for its low cost and high quality products. The big name of Amazon will be a strength for Amazon Go as people already have trust on Amazon so it will be easy for them to trust on Amazon Go.

Weaknesses: Amazon Go’s weakness can be the costly maintenance of highly used technology, as virtual reality concepts will be implement in store which requires proper testing and maintenance which is the costly procedure. Another weakness can be the understating of people regarding shopping procedure and their devices compatibility issues could also raise. Managing the supplying of fresh produced food and meats can also be a weakness.

Opportunities: After performing the market

Threats Competition has increased in recent years in both retail and AI processing solutions. A threat that can be faced by the business is the stability of the AI based system as they are introducing the new technologies based on virtual reality and in starting bugs and errors can arise, which will

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results as customer lose. Changing demographic patterns can also be a threat for Amazon Go because of change in customer buying patterns.

SMART strategy For the development of strategic plan some activities have to perform by Amazon Go in new market, SMART (Specific, Measurable, Attainable, Relevant, and Time based) is a significant tool which will help to cater down the activities in a framework to achieve goals. SMART goal strategy will help Amazon Go to maintain the structure and tractability of goals. Every goal can be made S.M.A.R.T to bring it closer to reality. It will also help to maintain the transparency among the company. Amazon Go’s smart strategic objectives are identified below. Specific The main objective for Amazon go is to embed the high technology and virtual reality concepts in real world. Measurable The

Market Segmentation Market segmentation is the strategy of dividing market into small approachable groups. Goal of segmentation is to focus on groups with the highest possibility to buy a product. It will be difficult for Amazon Go to focus on everyone without any proper segmentation which cause the effectiveness of marketing. Amazon Go products range includes all the items required in daily life and main focus is to deliver these products to customers with automated system of purchasing and market segmentation can help Amazon Go to focus on smart shoppers. Smart shoppers Smart shoppers is a market segment which represents the group of people who prefer ease over price. They are seeking for maximize shopping vale and minimize the investment on effort and time. After performing research on this segment, the cluster analysis shows three types of smart shoppers which includes spontaneous, apathetic, and involved smart shoppers. These types are differ from each other because of consumer characteristics, generational cohorts, shopping values and evaluations performed after purchase. Smart shopper segment is best suited for Amazon Go marketing. 6

Justification Smart shopper market segment will helps Amazon Go in effective marketing as it will be easy for them to target specific group of population. Because of the automated store idea and highly used technology for customer ease, it would not be difficult for Amazon Go to attract smart shoppers as their only demand is to make the shopping procedure efficient with in minimum time.

Brand positioning It is a positioning strategy for placing your brand in the mind of customers. The company’s core asset is branding, which can be the main reason of business success. Amazon’s main strengths are customer loyalty, and Amazon is famous for its innovative and reliable products. Other factors that can be measure as a strengths of Amazon are sustainability and environmental efficiency. Brand ranking really matters for business growth and Amazon is one of the most innovative name in the world. Amazon promised to offer innovative products, latest technology and unique features and from past experience it can be observed that the Amazon always deliver best to its customers. As Amazon Go introduce the concept of automated stores, shopping seems to be easier and can be done anywhere and the idea is become pioneer in the market, brand positioning will not be so difficult because of existing name of Amazon and

conventional branding strategy will be helpful for Amazon Go.

Marketing mix Marketing can be defined as the, “putting the right product in the right place, at the right price, at the right time”. This required a lot of hard work and research and if even one of the element is fail to meet the criteria then the promising product can fail to full fill the market needs. The 4P’s model is use for the internal analysis of business which have four different dimensions. The model evaluates the different internal factors of the product like sales, price, offers and promotions .

Below is the description of who the model will effect Amazon Go. Product There is a vast range of products that Amazon Go will sell which includes every thing from apparels to auto parts, toys to electronic gadgets, home décor to health/beauty utilities and grocery items. The vast range of product will help amazon to fulfil maximum

needs of people in one store. A proper product line will be developed for Amazon Go to stock up the products in it inventory. The wide product range of Amazon is the great opportunity for company to focus on products with high demands and can maximize the supply Amazon Go have to stock up the products in its inventory that are high demands in most of the population to enter in the new market. This will 7

help the company to plan a product line on which Amazon have to focus for the success of business. Place To set up a new business, analysis of location is essential as sales will boost if the automated store is near to residential area. And another concept is to draw the attention of maximum customers, the store can be located in the metropolis’s centre. In both scenarios, location have some pros and cons like if the store is located near the residential area so there might be greater risk of theft. On the other hand setting up store in the centre of metropolis will fail to attract the people who need to buy daily essential grocery products. Price Pricing is an important component for any business’s marketing plan because it determines company’s profit and survival. Amazon Go’s marketing matrix based on competition based pricing strategy. As the high virtual reality technology is imposed in store which requires maintenance cost and because of this pricing will be set according to the overall cost and resources required by Amazon Go. And due the market competitors pricing will also be set on the basis of competition.

Promotion Powerful promotional strategy can be very helpful for business and Amazon Go can easily adopt it because of its popularity and customer relations. Amazon Go can adopt some strategies for promotion which are:    

Best advertising practices – to introduce and raise awareness for the automated store. Search engine optimization – search engine marketing is a smart strategy will help the Amazon Go to getting the company’s high in search engine results. Partnerships with companies – the strategy will help to make relations with other companies which is essential for promotions. Best communication practices – communication is the key to promote the company, Amazon Go will have to make the communications strong by getting more interaction with their customers and listen to their feedbacks.

Conclusion In order to achieve the leading position in UK market, continues working required on the marketing strategy to make better products and services with high quality as compare to the other companies leading already in the market. The strategic marketing plan suggests all the possible strategies and

approaches for Amazon Go marketing according to the frameworks. The SWOT analysis

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performed to find the internal strengths and weakness and external opportunities and threats. Perform the PESTLE analysis and review the Porter’s 5 forces for Amazon Go automated store concept. Further analyze the SMART strategic objectives of Amazon Go and identify the smart shoppers marketing segment which can be used by Amazon Go for target marketing. Proposed a brand positioning strategy for the smart shoppers’ market segment and at the end presents the marketing mix of Amazon Go which concerns with the product, pricing, place and promotion. In order to achieve the leading position. In UK market, Amazon Go have to follow all the strategies and use every tool effectively suggested in the marketing plan.

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