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1 Kindle Fire: A Case Analysis Name of Student Institutional Affiliation

2 Kindle Fire: A Case Analysis I. Introduction Amazon.com, as it is now known, Amazon.com was founded by Jeff Bezos in his garage in Bellevue, Washington, to become the most customer-centric business in the world, where anyone could buy anything online. Constantly 1999, Amazon accomplished it's establishing mission by turning into the biggest web-based book shop with 10% of the online business market in North America. However, in 2001, Amazon experienced a brief period of difficulty, reporting a loss of up to $1.4 billion and laying off more than 1,000 employees. Bezos decided to hire a different company to outsource some of the company's activities, like shipping. The site that saved the business came back due to this action. According to Stone (2013), Amazon is today's most successful online retailer, ranking among the Fortune 500 e-commerce companies. II. Strategic Profile and Case Analysis Purpose Amazon has a long history of investing in new opportunities since its inception. Sony Reader was the only player in this new market when a new trend in e-readers emerged at the turn of the century. Amazon entered this market in 2007 to satisfy the unmet needs and introduced its first Kindle model. This item was fruitful, selling around 400,000 units toward the finish of 2007. Nonetheless, this achievement pulled in many adversaries, including Apple and B&N Alcove peruser (Duty, 2013). Per this examination, the original Fuel costs were set at $399. Throughout the long term, Amazon made changes to arouse, and in 2010, their benefits declined because of developing rivalry. In 2011, Amazon sent off the subsequent model, the Encourage Fire, trying to undermine the ongoing tablet market. The encourage fire gadget has been modified and retailed at exceptionally modest costs of $199 when contrasted with different items in this classification. In addition, tablet buyers were drawn to this one-of-a-kind tablet because of its tablet-like features and enhanced e- reader features. Because of this customization, the Kindle Fire may be categorized as a hybrid tablet-reader rather than a tablet. Bezos alluded to this gadget as "the finish of numerous things we have been accomplishing throughout the previous 15 years."

3 Among the administrations that Ignite Fire gives incorporate; being the best e-reader, having access to the Amazon App Store, streaming movies and TV shows, and downloading games. This device is superior to Apple, Samsung, and Nook products in terms of price, customization, battery life, and access to a large online e-book store . In this digital era, this case study aims to investigate the contemporary internal and external factors that influence the evolving tablet industry and e- commerce business. This paper will look at some new strategies and alternatives that can meet the current demand in the tablet and e-reader industries based on the findings of the environmental analysis. III. Situation Analysis A. General environmental analysis A general environmental analysis looks at six important parts of an industry: sociocultural patterns, worldwide patterns, segment changes, monetary circumstances, political/lawful patterns, and innovative changes (Hitt, Ireland, and Hoskisson, 2012). First, the tablet industry is greatly influenced by technological advancement. Amazon must stay up with the latest because, with mechanical progression, more individuals are shopping web-based utilizing tablets and cell phones. This fast change in innovation presents two dangers and open doors. Based on increased IT efficiency, new technology boosts performance and maximizes innovation for new tablet features. Second, the demographics of tablet users have a significant impact on this industry. According to Stone (2013), a person's age, education level, family size, and social class all play a significant role. The significant segment's huge advantage for igniting a fire is the period of purchasers. At first, it designated old age, yet millennials embraced it . Social circumstances likewise impact Amazon's Encourage fire. A portion of the social changes and patterns that impact the market for Ignite Fire incorporate expanding abundance divergence, expanded web-based purchasing propensities, and expanded commercialization in developing business sectors. A threat arises from the possibility that an increase in wealth disparity between the various social classes will stagnate buyers' disposable income. However, Amazon can profit from

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4 expanding in response to rising levels of consumerism and demand for e-readers. Moreover, monetary changes significantly influence fuel fire. Consumer spending, rising disposable income in developing nations, and the economic stability of developed nations and markets are some macroeconomic factors that influence this tablet. Monetary strength in created markets advances the development of Amazon's retail business due to limited chances. On the other hand, most people are saving, reducing the impact of unemployment. Ecological mindfulness on issues such as unnatural weather changes and diminished contamination also influences Amazon.com. Issues, for example, decreased travel and more shopping on the web, emphatically impact the organization. This is because distributors are picking "green choice.” Lastly, a massive partnership like Amazon operates within legal and political trends. Various government decisions influence this industry's market and finances. For example, expanded government support for online businesses emphatically impacts Amazon's online retail business. Amazon could develop under such government strategies (Davis, 2015). It's also important to remember that the new entrance will increase competition due to these government policies. In addition, political stability is another factor that influences Amazon's customer base growth trends. This is due to the favorable political stability conditions for Amazon to expand and diversify its activities across numerous nations. B. Industry analysis Examining the tablet market through the lens of Porter's Five Forces of Competition may provide light on whether or not the Kindle Fire can hold its own against the competition. Substitute product threat, customer bargaining power, new entrant threat, competition between competing enterprises, and supplier negotiating power are all evaluated in this model (Hitt, Ireland, & Hoskisson, 2012). Since the firm's tablet costs are the same as those at other shops like Best Buy, the company needs more leverage when negotiating with its suppliers. The e-reader's pricing and other tablets like the iPad and Kindle Fire are the same at every shop. Because tablets and e-readers are offered directly to consumers, there needs to be more room for negotiation between buyers. In addition, these

5 customers have a wide range of individual preferences and do not carry much weight as a group. And because the contents of the Nook or iPad won't show up on the Kindle Fire, customers may find it too expensive to transfer devices. Given the current market dominance and brand awareness, new entrants pose less danger to the tablet business. As the industry leader, Amazon's Kindle Fire e- reader benefits from economies of scale, a large user base, and competitive pricing. Competition from portable electronic devices like laptops, notebooks, netbooks, and smartphones is fierce in the internet's globalized marketplace. E-reader tablets face competition from goods with comparable costs and firms with greater technology, such as Apple. All of the above contributes to an already intense level of competition. The Kindle Fire's primary competitors are the Apple iPhone, the Samsung tablet, and the Nook. There have been fierce pricing battles in this business, as seen by the fact that Amazon is selling the Kindle Fire at a premium to undercut competition from Android tablets. C. Competitor analysis Currently, the Kindle Fire owns more than half of the e-reader market in North America. However, Barnes & Noble's Nook, Apple's iPad, Sony Reader, and laptops are close competitors (Sena J & Sena M, 2013). In 2011, a Vision Critical survey found that laptops and desktops dominated the global e-book reader market with a 50% share. Apple came in third with 15%, and Amazon's Kindle came in second with 47% (Stone, 2013). Macintosh's iPad is the nearest opponent for Fuel Fire. The tablet industry's dominance and brand loyalty are its primary advantages. However, unlike the kindle fire, which has a QWERTY keyboard and costs $499, this device only has a touch screen. Additionally, readers that read colored text from Sony and Nook cost a lot. The difficulty of protecting the company's design from imitation is another significant factor that contributes to the high number of competitors. The ongoing plan claim between Samsung and Apple demonstrates this, where Samsung purportedly took Apple's plans (Rieberger, Narang, McNicol, and Purdey, n.d). D. Internal analysis

6 Amazon's internal analysis will determine the relationship between the kindle fire's available resources and their use in creating value for its customers. Additionally, it will highlight Amazon's strengths, weaknesses, and opportunities. The fact that Amazon has a sweet spot for current innovations is its primary advantage. The key to its success is its capacity for technological change adaptation. It has earned the moniker "everything store." Their products have continued to diversify over time, and the company has expanded by acquiring successful rivals and innovating in a new market. Amazon's base camp is in Washington; however, they have client satisfaction administrations, programming development, and server farms all around the globe. The vertical integration of Amazon's divisions, services, and products results in internal synergy, and the departments' names and structures frequently shift to reflect their changing services. The Kindle, digital media delivery, Amazon web service (AWS), and retail websites with e-commerce are among their current offerings. Amazon assesses its exhibition diversely contrasted with enterprises of their size. Since its launch, the Kindle Fire has increased Amazon's revenue, and the company claims that it is still its best- selling product. In 2011, Amazon announced more than $50 billion in income, with the item selling out three days after sending off Arouse (Duty, 2011). One significant detriment is that Amazon spends an extraordinary arrangement in putting away and delivering freight. To reduce these expenses, it should consider selling the Kindle Fire online. IV. Identification of Environmental Opportunities and Threats and Firm Strengths and Weaknesses (SWOT Analysis) The tactical planning process of any business includes SWOT analysis because it demonstrates the connection between the strategies and goals that will result in the desired outcome. A business can position itself in the market this way after considering how to use its threats and weaknesses to advantage over opportunities and strengths. The SWOT analysis of Kindle Fire is depicted in the figure below.

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7 Summary It is unlikely that the kindle fire will challenge the Apple iPad family's dominance of the tablet industry. However, due to its new silk browser, easy access to Amazon content, storage options, and advanced Android operating system, it will likely become the most popular brand among other Android tablets. Furthermore, each new ignite fire sent has a year of free membership to Amazon films and music, Amazon Prime , Android Applications, and Amazon Applications. As a result, even if the product sells at cost, it can recover these costs by selling its content. This is the core of Amazon's strategy to compete with Apple and others. And increase your share of the tablet market. V. Strategy Formulation A. Strategic alternatives, evaluation, and choice Amazon's market strategy should combine the growing tablet market and the established demand for e-books. The blue ocean strategy is the one that the Kindle Fire should use, making its own uncontested market space by blending tablet industry requests with tablet requests. This system is strong because Amazon can characterize its limits and avoid the wild rivalry between the tablet and Tablet businesses . In addition, this "blue ocean" strategy will try to reach people who don't have iPhones. Those clients are searching for better Android tablets since they can't manage the cost of the iPads and other Macintosh items. Ignite Fire looks like a media utilization gadget and draws away the consideration of contenders. Nevertheless, Amazon should maintain low prices and target low-income customers who cannot afford Apple's costly product line. Higher education students and media junkies are two examples. For customers to appreciate the Kindle Fire's singularity, Amazon should promote this differentiated product in retail stores alongside rivals' products like the Nook, Samsung, and Apple iPads. Using this "blue ocean" strategy is also important for entering untapped markets, especially in developing nations and emerging markets like Asia, where the economy grows quickly, and new buyers enter

8 (Lang, Tinder, Zimmerman, & Harrison, 2012). On the other hand, the main drawback of this strategy is that Amazon might think they have a better, one-of-a-kind product when there are similar ones on the market, ignoring the competition. Additionally, the blue ocean strategy needs to consider the existence of new products being developed by other businesses because it uses the tablets currently on the market as a benchmark. Finally, the blue sea technique might prompt organizations like Amazon to swim excessively far and move their concentration from the organization's central goal; Despite its goal of becoming a major e-commerce company, Amazon has previously ventured into the tablet market. Platform strategy is the second approach that Amazon can take. In his book "Staying Power," Michael Cusumano said that Amazon should let outside innovators use the company's platform and create complementary products that promote the company's innovations. For instance, Facebook recently introduced its application programming interface, which made it possible for applications and innovations to communicate with Facebook. Apple has also adopted this strategy by allowing iTunes to interact with the Apple platform . Thanks to the platform strategy, the company can modify and create valuable apps that interact more effectively with the expanding external media in the digital market. As a result, by enhancing the device's resolutions and specs, the platform strategy ensures that newly developed superior link hardware interfaces with this external innovation. Additionally, the company gains the advantage of generating additional revenue by employing the platform strategy. Content owners share the company's revenue from the external interface. Platform strategy is the way forward for tablets and e-readers in light of the declining value of hardware innovation and the revenue generated by selling hardware devices. This is because the hardware is more important in the ongoing computerized market selling data. Therefore, in the future, hardware products will only be useful as servers for retrieving and selling expensive, automated digital content. Hence, Amazon can gather much outer substance in their Fuel fire. Amazon has the advantage of developing its Amazon Prime service into a robust platform for

9 distributing digital media content. Amazon's competitors in the e-reader market and tablet market, such as Apple and Samsung, are more concerned and focused on the quality and quantity of units sold when evaluating the two strategies above. As a result, Amazon ought to employ the blue ocean strategy, deviate from the mass strategy and thinking, and concentrate its agendas on the content that individual tablet and e- reader customers prefer. Amazon can do this by analyzing every competitor's weakness and using it to create products that will fill the void left by improving the competitor's existing offerings. Also, by Amazon dissecting contenders' shortcomings and assets, it can foster items that are better than the opponents' items and sell them at generally lower costs because its attention will be on the items that customers of these tablets and tablets request. The popularity of this tablet reader will undoubtedly rise with the release of the kindle fire. Nonetheless, given the restriction that the blue methodology has of being chargeable for future deviation from the organization's main goal, Amazon ought to track down an approach to intermarrying/combining these two procedures. The current furious rivalry will take longer to drive the costs of tablets and tablets down; additionally, it will ultimately push a few opponents out of the market since income from the equipment offered in what's to come will constantly decline. However, if Amazon were to use both of these strategies simultaneously, it would generate additional revenue from the platforms and from its distinctively different products and services. VI. Strategic Alternative Implementation The blue ocean strategy is more beneficial and promising. Because there will always be flaws in the models and strategies of competitors, Amazon has a significant advantage in identifying and analyzing its weaknesses. Additionally, Amazon can employ a hybrid strategy that combines the blue ocean strategy and the platform strategy. A. Action items and action plan Amazon must take the following steps to reach these goals. First, vertical integration should be used because it is adaptable and meets the changing demands of the tablet industry. After that, it ought to

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10 assemble a group of tech pros who will constantly evaluate and improve these devices. The following stage is zeroing in on the element of the tablet peruser. The device aims to cut costs by creating differentiated goods without common features like Bluetooth, GPS, and cameras. In addition, they should concentrate on reducing the screen's size and the amount of storage space while improving the device's durability, lightweight, speaker quality, screen clarity, and video loading time. It should also increase the number of content to promote this product as a media platform and produce e-Pub, flash video, cloud storage, and DRM-free music . The following "levels" are crucial to Amazon's successful platform strategy implementation. They are important in terms of their scope and relationship with the content providers of the complementary services. The in-house administrations should relate well with the outer administrations. The way to turn into an effective stage is by keeping a mutually beneficial connection with integral organizations. The Amazon silk program illustrates a supplement that Amazon utilizes for its foundation. Other options include the Amazon Kindle app, which can be installed on any operating system, including Apple, to buy Kindle books. Therefore, for Amazon to realize its full potential as a major platform, it must offer companies financial incentives to advertise their products on the Kindle Fire. The following stage in the stage technique guarantees that other working frameworks can get to Amazon's working framework. In this way, Amazon ought to foster a semi-open working framework that is a passage to both the Android and the Apple operating systems yet should hold control of the UI and equipment. Amazon must determine what content on the platform will attract many users as it develops the platform. Besides, while fostering a stage, it is essential to consider ways that Amazon can use virtual entertainment applications, for example, Facebook and Twitter, to attract additional clients since online entertainment in the computerized time is a main impetus. VII. Conclusion Instead of competing with established tablet companies like Apple, Amazon should concentrate on its core competency of providing e-books, e-readers, and a modern platform. The growing demand

11 for digital books and investing in e-reader devices will result in a more lucrative business. The recent fad of instruction foundations utilizing computerized books from grade schools to advanced education will build interest in tablet gadgets. As a result, as retailers attempt to integrate vertically, books will become platform applications, and publishing will become more profitable (Davis, 2015). Additionally, Amazon should market itself as a digital media-accessible interface or platform. In the e-commerce industry, e-books have a small market share (a drop), but internet advertisements have a huge market and will only grow in the future. In keeping current customers, the device's multiple applications will be more important than its hardware.

12 References Davis, M. (2015). E-books in the global information economy. European Journal of Cultural Studies , 18 (4-5), 514-529. Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2012). Strategic management cases: competitiveness and globalization . Cengage Learning. Lang, S., Tinder, L., Zimmerman, J., & Harrison, J. S. (2012). Amazon. Com: Offering Everything from A to Z. Levy, S. (2011). Jeff Bezos owns the web in more ways than you think. Wired Magazine . Rieberger, L., Narang, M., McNicol, K., & Purdey, J. (n.d.)The Tablet War: Apple vs . The Rest. Sena, J. A., & Sena, M. P. (2013). The Tablet Evolution and Diffusion. In Proceedings of the Information Systems Educators Conference ISSN (Vol. 2167, p. 1435). Stone, B. (2013). The everything store: Jeff Bezos and the Age of Amazon. Random House.

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