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Ecommerce Case Studies

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----------------------- eCommerce Case Studies

Case Study 1: Amazon

Amazon, originally called Cadabra, was launched by Jeff Bezos in 1995. It was set up during the dotcom boom of the 1990s with an unusual business model - it did not expect to make a profit until after at least four years of business. While other dotcom businesses grew rapidly, Amazon slowly built strong foundations. Finally, at the end of its fourth year, it made a $2.5 million profit. In 2005, it made a profit of $359 million and in 2006, $190 million.

Amazon's most famous for selling books, but the company also sells a wide range of products from CDs to small kitchen appliances such as coffee machines. Sales in books from traditional stores have reduced recently and Amazon has often been blamed for `stealing' their sales.

Amazon provides an enhanced experience for its customers. For example, when a customer logs in they see a personalised page with suggestions of products they might like. Amazon does not just provide the products, but includes customer reviews, detailed product descriptions and other information to help customers to select the right product for them.

There are facilities to create a wish list and a wedding list: customers create a list of products that they would like and pass this on to family and friends to let them know what to buy for a wedding gift or other occasion such as a birthday.

For more information, visit the Amazon site, especially the About Amazon and Help sections. A link to this website is available at www.heinemann.co.uk/hotlinks. Enter the express code 2315P

1 Describe Amazon as an e-commerce entity.

2 Why has Amazon become a very successful business? How has the company gained and retained its customers' loyalty?

3 How have the lower start-up and running costs o e-commerce affected Amazon?

4 Describe the impact Amazon has had on

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