Perspectives of Big Data Analytics’ Integration in the Business Strategy of Amazon, Inc.

MUSTAPHA BOUAKEL1 and AMINA ZERBOUT2

Associate Professor, Faculty of Economics, Commerce, and Management Sciences, University Center Ahmed Zabana, Relizane, Algeria,

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2PhD Student, Faculty of Economics, Commerce, and Management Sciences, University Ali Lounici, Blida 2, Algeria,

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ABSTRACT

This study aims to shed light on the role of big data (BD) in the promotion of Amazon’s e-commerce. The study concluded that the success of the company is due to the early adoption of the principles of BD, and its integration into the commercial strategy.

The company has also been able to invest heavily in the development of applications for the big data mining (DM) and analytics, as well as designing a technical map that responds to the concerns of customers, gives greater ability to track their behaviors and protect the procedures of shopping, delivery, and payment, which indicates that Amazon’s success in leading e-commerce involves standards of the control degree over the vast amount of data, the team skills and the nature of the technical tools to achieve its strategic vision. It is also expected that big data entry will continue breaking new horizons in this area in the foreseeable fixture.

17.1 INTRODUCTION

Big data analytics has emerged as a new interface for innovation and competition in a wide range of e-commerce. It provides a large number of companies that use people’s dynamics, processes, and technologies to transform data into insights to make rational decisions and solutions to business problems.

This approach requires close integration of data, resources, skills, and systems in order to create a competitive advantage. Major e-commerce companies such as Google, Amazon, and Facebook have recognized big data analytics’ role in driving their annual revenue increase.

Leading e-commerce company Amazon and its subsidiary Zappos were ranked among the top ten retailers at the American Express Awards Customer Choice Awards for 2010 and 2011, respectively [1].

Industry observers have acknowledged that recognition of the company’s dominance in this area was the result of Amazon’s use of big data resources to provide superior quality of service.

Since its emergence as the dominant Internet sendee provider in the early 2000s, Amazon began to focus on big data to improve its performance along with many major Internet companies. Since then, it has focused on properly utilizing huge databases about people who were shopping on e-commerce portals.

The acquisition of Zappos in 2009 facilitated the use of big data to improve customer sendee quality and verify organizational fraud. In addition to easy access to customer profiles, purchasing habits, and tracking of the browsing, it also facilitated the company’s executives to provide quick solutions to customer concerns.

Numerous research has emerged trying to understand how Amazon’s leading e-coimnerce company is using big data resources to improve its performance, especially in light of the overlap of many variables such as the breadth of its database of tastes and preferences, customers’ previous purchase history, and divergent trends, in addition to the intense competition from other companies such as Ali Express and e-Bay and others.

Nevertheless, Amazon has succeeded in leading global e-commerce by analyzing big data and reflecting its vision to the extreme. On this basis, the problem statement can be raised in the following key question:

How did Big Data Analytics contribute to the success of Amazon’s business strategy?

The objective of the present work is to analyze how Amazon uses its own big data resources to build a better relationship with its customers, and appreciate the importance of developing big data capabilities to improve company performance. In addition to demonstrating Amazon’s Strategy for helping other e-coimnerce portals to take advantage of big data resources, and explore ways in which Amazon can use big data resources to improve its business prospects.

Amazon’s big data technologies have provided important opportunities to understand customers’ preferences in detail and gain a competitive advantage in the market; it also allowed them to respond to the requirements of different segments and greater ability to track customer behaviors.

This has driven it to invest heavily in developing data management structures from the traditional data storage model to more complex structures such as real-time processing and batches, handling structured and unstructured data, and challenging high-speed transactions.

To understand the topic and answer the problem of the study, a descriptive approach was adopted in reviewing the basic concepts related to big data, its forms and methods of treatment, and the importance of exploiting them to give Amazon a competitive advantage, in addition to highlighting the role of technical tools in promoting its business strategy.

The study was structured into three main sections:

  • • Motives and milestones of transformation to deal with big data;
  • • Characteristics and backgrounds of Amazon’s business strategy; and
  • • The role of big data in promoting Amazon’s e-commerce.
 
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