One of the main goals of Amazon is to constantly enhance the customer experience in the marketplace and build strong customer relationships. The company has always been customer-centric and has successfully mastered customer relationship management by offering convenience, low prices, multiple options, and an overall enhanced shopping experience. Some of the strategies used by Amazon for customer relationship management are:
The platform’s user interface is extremely easy to use and understand. The high-quality images, accurate descriptions, easy checkout process and organized categories of products greatly enhance the shopping experience and hence induce customers to spend more time on the platform.
Recommendation: The product recommendations and product bundling based on the past buying behaviour of customers are perfect for boosting sales while simultaneously offering a convenient shopping experience.
Customer support: Amazon tries to limit the need for customer support and makes self-help easy for customers if they get stuck anywhere. However, the company understands the importance of an efficient customer support system where the consumers have 24/7 support available for any of their queries or problems.
Review system: Amazon also has an online review system where customers can share their experiences and opinions about a certain product and even upload pictures. The social validation system connects the buyer community and also ensures good quality standards in the marketplace.
Amazon’s key objective has always been selling products at the lowest prices. That is why even though the company has the opportunity to translate its lower cost structure into profits and return some profits to shareholders, it passes them on to the customers through network effects.
The network effects create a loop where the low prices of products on Amazon enhance customer experience, driving more traffic to the platform. The increase in traffic and number of customers induces more third-party sellers to join the network, increasing the options available to the customers. This, in turn, further enhances the customer experience by providing various categories of products at low prices.
Moreover, Amazon uses the revenue generated from increased sales to improve its cost structure further. A big portion of the revenue goes to improve fulfilment and delivery networks which further lowers the cost structure. Amazon has used network effects and marketing strategies since the very beginning, which has helped the company to expand and take over various industries successfully.
Amazon Fulfilment Options: The Supply Chain
Inventory management is a key task for Amazon as the company deals in such a wide variety of products. Amazon provides various fulfilment options to the merchants, including Fulfilment By Amazon (FBA) where Amazon stores, packs and ships the product through its fulfilment centres follow amazon fba profit calculator to discover the best category to start your amazon business.
Easy Ship where the merchant stores and packs the product but Amazon delivers it.
Fulfilment By Merchant (FBM) where the merchant handles storage, packaging and delivery of the product.
Therefore, Amazon stores most of the products placed on the marketplace and hence has to manage a large amount of inventory. So to satisfy customers with speedy delivery, the company has managed to create an efficient inventory management system and order picking process.
