Question

Why did Amazon expand its business from bookselling to e-commerce and then to e-publishing, electronic devices and cloud computing?

Answer 1

It is essential to bring diversity in business operations. A diversified business operation always attracts target customers and opens up a new opportunity in the new target market. It requires risk-taking capability and proper market analysis to transform the business from one operation to another. Amazon Inc has performed exceptionally well in changing its operational activities. Initially, it was an average bookseller. However, later, the risk-taking capability, proper market analysis, and improvement in productivity have helped this organization to transform its business base into eCommerce operations. Reasons to change the business base from bookselling to e-commerce are as follows:

• The company understood the current business trend as the virtual involvement of people is increasing rapidly

• The company has recognized that the current trend of shopping is turning into online shopping from window shopping. It has helped the organization to transform into e-commerce

• Ecommerce business has opened up an opportunity for the organization to collaborate with different brands around the world which promotes partnership business. It has helped Amazon to improve its target market base.

Currently, Amazon Inc is dealing with e-publishing, electronics devices, and cloud computing. The high demand for e-book and enhancement in the number of e-book reader have promoted Amazon to change its operations from bookselling to e-publishing.

Cloud computing support is currently helpful for organizations to store confidential documents. Amazon provides low-cost cloud computing support to satisfy the needs of its customers.

Thus, the change in the market demand is the primary reason behind the expansion of Amazon.