abhishreshthaa
Abhijeet S
Pest Analysis On Amazon.com : Amazon.com, Inc. (NASDAQ: AMZN) is a US-based multinational electronic commerce company. Headquartered in Seattle, Washington, it is America's largest online retailer, with nearly three times the Internet sales revenue of the runner up, Staples, Inc., as of January 2010.[3]
Jeff Bezos founded Amazon.com, Inc. in 1994 and launched it online in 1995. The company was originally named Cadabra, Inc., but the name was changed when it was discovered that people sometimes heard the name as "Cadaver." The name Amazon.com was chosen because the Amazon River is the largest river in the world, and so the name suggests large size, and also in part because it starts with 'A' and therefore would show up near the beginning of alphabetical lists. Amazon.com started as an online bookstore, but soon diversified, selling DVDs, CDs, MP3 downloads, computer software, video games, electronics, apparel, furniture, food, and toys. Amazon has established separate websites in Canada, the United Kingdom, Germany, France, Italy, Japan, and China. It also provides international shipping to certain countries for some of its products. A 2009 survey found that Amazon was the UK's favorite music and video retailer, and third overall retailer.[4]
PEST Analysis
Although internet security and systems have improved, the wide inequality of technology distribution in the global arena undermines the endeavors of technology- and innovation-based firms like Amazon. Apparently, sales of these companies will be limited to the top 20 countries that posted an average of at least 50% of internet penetration against the bottom 200 of less than 5%. The more-or-less 90% of global population without internet access is aggravated by the top 20’s similar condition although prospects for the latter of becoming potential on-line customers are definitely higher than the bottom 200.
Further, building the technological environment for the bottom 200 could be a relatively easier national concern than building the necessary human capital to facilitate and use such infrastructure. This fact goes beyond the budget limitation of institutional segments (government, businesspeople, and academic foundations) and requires subsequent, if not preceding, popular culture approval. The less tolerant cultures like that of Chinese to Western aspirations is an example of e-commerce challenge belittling the power of technology against the rule of cultural supremacy that is conservative of modernism uncertainty that could attack political and cultural beliefs of local population.
Finally, the importance of technological education for both customers and businesses is an indispensable platform required to augment internet penetration and socio-political resolutions. Amazon’s case charges against email forgeries in 2001 and 2002 implied the adversary effects of e-commerce to consumers and legal services providers alike including the government’s capacity to earn. With incentive to learn the technology skewed to profit-based opportunists, legitimate benefits attributable to core stakeholders will only be sub-optimal and could ultimately pilot to discourage customer reliance on online shopping leading to unnecessary costs accruing to technology providers (litigation, advertisements) and government (monitoring).
In the less internet penetrated countries, foreign direct investments not simply portfolio capital is needed to stimulate the demand for e-commerce at a significant level. This move would be limited to open countries while close countries could be approached through amplified political relationships, possibly trade pacts. At the end, strong governmental lobbying favoring the technology-based industry or pre-determined national priority to modernizing key institutions are supporting conditions to initially deploy rational market segmentation to underdeveloped and developing nations. Seeing technology diffusion initiated by political hierarchies is more dependable pre-condition than relying on the citizen-driven model of demand because it has the ability to relax religious and cultural ideologies at the face of developmental and economic issues towards a sustainable national dominance theory.
Jeff Bezos founded Amazon.com, Inc. in 1994 and launched it online in 1995. The company was originally named Cadabra, Inc., but the name was changed when it was discovered that people sometimes heard the name as "Cadaver." The name Amazon.com was chosen because the Amazon River is the largest river in the world, and so the name suggests large size, and also in part because it starts with 'A' and therefore would show up near the beginning of alphabetical lists. Amazon.com started as an online bookstore, but soon diversified, selling DVDs, CDs, MP3 downloads, computer software, video games, electronics, apparel, furniture, food, and toys. Amazon has established separate websites in Canada, the United Kingdom, Germany, France, Italy, Japan, and China. It also provides international shipping to certain countries for some of its products. A 2009 survey found that Amazon was the UK's favorite music and video retailer, and third overall retailer.[4]
PEST Analysis
Although internet security and systems have improved, the wide inequality of technology distribution in the global arena undermines the endeavors of technology- and innovation-based firms like Amazon. Apparently, sales of these companies will be limited to the top 20 countries that posted an average of at least 50% of internet penetration against the bottom 200 of less than 5%. The more-or-less 90% of global population without internet access is aggravated by the top 20’s similar condition although prospects for the latter of becoming potential on-line customers are definitely higher than the bottom 200.
Further, building the technological environment for the bottom 200 could be a relatively easier national concern than building the necessary human capital to facilitate and use such infrastructure. This fact goes beyond the budget limitation of institutional segments (government, businesspeople, and academic foundations) and requires subsequent, if not preceding, popular culture approval. The less tolerant cultures like that of Chinese to Western aspirations is an example of e-commerce challenge belittling the power of technology against the rule of cultural supremacy that is conservative of modernism uncertainty that could attack political and cultural beliefs of local population.
Finally, the importance of technological education for both customers and businesses is an indispensable platform required to augment internet penetration and socio-political resolutions. Amazon’s case charges against email forgeries in 2001 and 2002 implied the adversary effects of e-commerce to consumers and legal services providers alike including the government’s capacity to earn. With incentive to learn the technology skewed to profit-based opportunists, legitimate benefits attributable to core stakeholders will only be sub-optimal and could ultimately pilot to discourage customer reliance on online shopping leading to unnecessary costs accruing to technology providers (litigation, advertisements) and government (monitoring).
In the less internet penetrated countries, foreign direct investments not simply portfolio capital is needed to stimulate the demand for e-commerce at a significant level. This move would be limited to open countries while close countries could be approached through amplified political relationships, possibly trade pacts. At the end, strong governmental lobbying favoring the technology-based industry or pre-determined national priority to modernizing key institutions are supporting conditions to initially deploy rational market segmentation to underdeveloped and developing nations. Seeing technology diffusion initiated by political hierarchies is more dependable pre-condition than relying on the citizen-driven model of demand because it has the ability to relax religious and cultural ideologies at the face of developmental and economic issues towards a sustainable national dominance theory.
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