Nowadays, the development of economic relationships ensures the increase in the number of business organizations, which leads to high competition in the market. To strengthen their positions and stay competitive, companies implement various strategies and introduce plans that achieve a better attraction of consumers. One of these strategies is the digital marketing strategy, which implies the utilization of digital technologies by companies to reach their goals (Kannan and Li, 2017, p.22). There are various types of digital marketing, such as online advertising, social media campaigns, search engine optimization, analytics, consumer journey mapping, social commerce, and more. In this paper, the digital marketing strategies implemented by Amazon will be analyzed.
Amazon is an American company that works in the e-commerce and digital streaming field. The organization takes a strong position within the industry because it is a member of the Big Four tech companies, along with Apple, Google, and Facebook. Amazon is considered to be one of the most powerful companies in the world, which invested more than $160 billion in the USA to create jobs and drive innovation (Aboutamazon, 2019, para. 4). This report consists of three main parts, namely, literature review, analysis of the strategies used by Amazon, and the impact of the strategies on the economic well-being of the company. At the end of the report, the conclusion that summarises the central ideas of the paper will be included.
There are various articles, reports, magazines, and websites that contain information about digital marketing strategies. Nowadays, in the conditions of competitive intensity and technological innovations, companies realized the importance of implementing marketing strategies. First of all, these strategies create new business opportunities for marketers. Second, the inability of companies to identify and respond to market changes accurately and quickly may result in the demise of an organization (Kumar et al., 2011, p.16). Researchers Bala and Verma, in their work “A critical review of digital marketing,” evaluate the advantages of marketing strategies.
They assert that online advertising is an excellent tool for creating brands, while the use of word-of-mouth on social media helps to attract more buyers (Bala and Verma, 2018, p.324). In general, the review contains a lot of crucial information about the important factors of digital marketing and the ways how it can be used.
Similarly, Gibson examines the connection between marketing and technological innovations. He reveals that having a website for an organization is an essential marketing instrument that supports all the other marketing efforts (Gibson, 2018, p.13). Gibson proves his argument by providing evidence from various sources, such as the Newspaper Association of American databases and several surveys that were conducted among customers.
The value of his work is ensured by the fact that the author reviewed multiple digital marketing strategies revealing their advantages. Thus, he examined e-mail marketing, saying that it is the best tool for distributing announcements and commercial information. He also considered Search Engine Optimization (SEO) and Search Engine Marketing (SEM) as two powerful strategies for targeting prospective customers (Gibson, 2018). This review can serve as a manual for start-up entrepreneurs who want to develop their business projects.
Amazon uses various digital marketing strategies to achieve the goals of the company. In this paper, two strategies of the organization will be analyzed, namely, social media marketing and SEO. These strategies are shaped by the idea of the founder of the company, Jeff Bezos. The idea implies the utilization of digital technology to enable limitless inventory, a boost of customer care, and lower prices (Kandemirli, 2018, para.17). Indeed, the popularity of Amazon around the world demonstrated that the business strategies, used by the company, bring positive outcomes.
Numerous sources evaluate the significance of social media marketing. Thus, Ponde and Jain point out that social media allow customers to communicate with each other and share their feedback about products or services they received (2019, p. 260). This idea is supported by Gaikwad and Kate, who examined the positive outcome of the utilization of social media and revealed that it promotes building trust between producers and customers (2016). A similar point of view is expressed by Simon Kingsnorth, who suggests various ways of implementation of social media in marketing (2016). The central point of these sources is the explanation of benefits that are brought by the utilization of social media in the business world.
However, there is no information about the negative impact of social media strategy in these works. It is undoubtedly that using social media benefits the company, but it is necessary to notice that its overuse may result in adverse effects. Thus, customers may get bored because of too frequent commercials or announcements, which may provoke the emergence of the negative associations of buyers with the company.
It is worth noting that marketers should be familiar with the negative consequences of social media marketing. Even though the majority of academic works highlight the advantages of social media, there are still some sources that examine both the positive and negative impact of the social media approach in marketing. For instance, Shafigullina and Palyakin consider the most common adverse impacts of social media marketing.
They include the absence of instant results, as social media marketing implies dedicating much time to get outcomes and the inability to accurately calculate the budget spent on social media maintenance (2016, p.4). Moreover, there is no guarantee that social media marketing will bring positive results, as any wrong comment of a representative of a company may result in its spoiled reputation.
As for the SEO, it was mentioned above that its implementation is crucial for the comfort of customers. A group of American scholars assesses the benefits of SEO in their work “Understanding search-engine optimization.” Also, they explain how to deal with difficulties that may occur during the implementation of this strategy. These difficulties may include choosing key phrases that are used by customers or attracting attention to one website among the millions of others (Gudivada, Rao, and Paris, 2015).
The uniqueness of the article is ensured by the fact that everything is explained simply. Even individuals who are not familiar with marketing tools can easily understand the central ideas of the research. Another group of scholars analyzed the strategies aimed to make the right anticipation of keywords of customers depending on their age. In addition, they found that older consumers use fewer words and include a brand name in their search (Baye, Santos, and Wildenbeest, 2016, p.6). Similar to the situation with social media marketing, there is no evidence in the mentioned research about the negative impact of SEO.
However, some scholars managed to examine possible negative outcomes of the approach. For instance, researchers from India examined the negative impact of SEO and concluded that its utilization by unskilled service providers is shown as the most unfavorable scenario for companies (Aswani et al., 2018, p.107). Moreover, SEO is hard to test and slow as it might take a few months for a new webpage to be crawled.
Therefore, it can be concluded that there are numerous academic works dedicated to digital marketing strategies. The majority of research, reviewed in this paper, examines only the advantages of digital strategies, ignoring the negative consequences of marketing approaches. In general, it is possible to find a lot of sources about various digital marketing strategies and use them as teaching tools for those who want to open a business company. As for the main strategies used by Amazon, social media marketing and SEO, they also have their advantages and disadvantages. The analysis of the strategies will be presented in the section below.
Analysis of Digital Marketing Strategies of Amazon
The digital marketing strategies implemented by Amazon made the company be one of the most successful businesses. As it was mentioned above, two approaches are actively used by the company, namely, the social media strategy and SEO. Social media marketing implies the utilization of networking websites and online platforms by companies to promote their products or services. It is considered to be the best tool for manufacturers to get in touch with potential customers and interact socially (Sajid, 2016, para.1). Many entrepreneurs use famous social media, such as Facebook, Twitter, or Pinterest. While Amazon uses all the mentioned networking platforms, the website of the company remains the essential online network for customers.
Indeed, the Amazon website is not just an online store; it is a huge social platform, which allows people to share their opinions and feedbacks about sold items. It enables customers to learn about the quality of the products before they purchase them, which decreases the probability of disappointment and dissatisfaction of buyers. Moreover, the platform ensures regular communication between sellers and customers, which promotes the building of trust between them.
The possibility of customers getting in contact with manufacturers and share their concerns about the products they purchase makes the process of shopping easier and smoother. Also, people always have a chance to ask questions about any products they are interested in to get more information about them. The online system of Amazon encourages customers to interact with each other through e-mails that are sent to buyers to ask them to provide feedback about the products they acquired.
In addition to its online platform, the company has social groups and accounts on various networking websites, such as Facebook, Twitter, and Pinterest. These groups aim to answer the questions of customers, provide information about new opportunities for buyers, and even suggest ideas for gifts for Christmas, Birthdays, or Mother’s Day. Therefore, the company does not bind itself in the single-channel rather expands toward multichannel, using its online platform, e-mail, and social media (Imran, 2014, p.9).
This approach allows the company to create a space wherein it can learn about the customers, how they are using services and products, and how the service can be improved (Kumar et al., 2013, p.335). The utilization of social media marketing strategy allowed the company to increase brand awareness, attract new customers, improve search engine rankings, achieve better customer satisfaction, and learn about the needs of customers.
There is various research that proves the effectiveness of the utilization of social media strategy by Amazon. For instance, scholars Adaji and Vassileva revealed that dialogue with customers significantly influences perceived product credibility (2017, p.294). It helps to trigger the work of the word-of-mouth mechanism, which attracts new buyers. Also, regular updates on social media that are performed by Amazon and the engagement of customers on all levels of collaboration are important factors that promote building trusting relationships with customers (Ashley and Tuten, 2015, p.18). Plus, these efforts strengthen the position of the company in the market.
In general, regular interaction with customers is the best tool that brings positive results for both customers and the company even on a psychological level. Thus, Hennig-Thurau, Facker, and Bloching assert that the ability of customers to get something in return for their likes and comments from befriended brands is a key factor that ensures customer satisfaction (2013, p.238). As a result of frequent interaction with people, Amazon was ranked number 1 in customer satisfaction for the last consecutive years (Kandemirli, 2018, para.17). Therefore, using the primary characteristics of digital platforms, such as strong network effects and openness and independence of the networking websites, Amazon ensured customer satisfaction and prosperity of the company.
Another strategy that will be analyzed in the frames of this work is SEO. SEO implies optimization of the websites that allows the companies to have better positions in the results returned by search engines (Mogos, 2015, p.241). There are a lot of advantages that are brought by SEO to Amazon. It includes better user experience, lower advertising costs, the building of brand credibility, establishment of brand awareness, and strengthening the position of the company in the market through maintaining its competitiveness.
SEO strategy has brought many changes in the principles of working in Amazon. In the past, Amazon’s product search engine consisted of several hand-tuned ranking functions with some input features (Sorokina and Cantu-Paz, 2016, p.459). However, nowadays, the situation has changed as the company started using an advanced SEO system. It provides not only the high ranking of the company on the internet sources but also predicts the success of products available on the company’s website and feedbacks of users (Castelli et al., 2017, p.118).
The company uses certain algorithms that help the customers to find the best products at the best price. This algorithm is called A9 and organizes customer conversion and provides the results of the searching process according to several factors. These factors include relevant keywords, quality and quantity of the products, their price, and reviews.
There are other digital SEO systems used by Amazon, such as SEMrush, auto-fill system, and scope. The SEMrush system allows optimization of keyword research, while Amazon auto-fill provides additional suggestions for the products. Scope helps people to look for relevant terms based on initial search words (Roddy, 2018, para.14). These tools aim to ensure that the manufacturers will sell high-quality products at lower prices, providing the right set of keywords.
Otherwise, their products will not be shown among the first results during the process of product search, which will lead to the loss of sale proceeds. Great content, high-quality product images, and positive reviews will also increase click rates (Jordan, 2019, para.12). Therefore, all the mentioned SEO systems ensure the responsibility of manufacturers who sell their products on Amazon without any significant expenses.
It is also worth mentioning that to enable the smooth function of all the systems within the organization, the company introduced the new role of the chief digital officer. Digital officers focus on building capabilities with a variety of digital technologies, concentrating on innovation, data analytics, and customer engagement (Tumbas, Berente, and Brocke, 2017, p.122). Utilizing the principles of low costs and independence of web framework as key characteristics of the digital platform, the company managed to achieve its main goals. Thus, it provided a better user experience, built brand credibility, and strengthened the position of the company in the market.
It can be concluded that nowadays, digital marketing strategies are actively used by various organizations. In the context of this report, two digital strategies utilized by Amazon were analyzed, namely, social media marketing and SEO. It was revealed that both strategies helped the company to achieve its goals. Even though Amazon is one of the most powerful companies in the world, there is still room for improvement. Thus, several future directions can be suggested for the company. First of all, it is necessary to consider expanding the Amazon chain as there are still some countries where the company does not provide its services. Second, it can be beneficial to use modern systems of delivery based on the utilization of drones. Initially, it will result in some expenses, but eventually, all the costs will be paid off.
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