Introduction
Since its inception in 1994, Amazon.com, Inc. has achieved immense success in areas ranging from acquisition to diversification (Spector 38). The corporation has made several acquisitions, such as the $4588 purchase of buy domain in 2014, and has diversified by establishing affiliates such as Amazon Web Services, Inc. (AWS). However, the company's attempt to manufacture mobile products such as Fire TVs, Fire Tablets, and Kindle e-readers never gained traction. The initiative to become innovative in competitive diversification failed because the goods did not compete with those of other firms. The strategic issue, in this case, is how the company can maximize the outcome in future innovative diversification while minimizing the cost.
The Process of Diversification
The process of diversification requires innovative ideas. It involves subversion from the initial path to a new venture (Bowman and Hatignon 34). Therefore, it is almost as good as developing and starting an original idea. For example, Amazon subverted to electronic devices production away from its first electronic commerce and cloud computing missions. Innovation being core to the process of diversification, it is usually backed up by thorough research (Delarue, Hootegem and Stephen 67). Unless there is enough and in-depth research, innovation can never take place. As such, there is a close connection between diversification, research, and innovation (Spector 21). Proper planning is required to organize the tools in a manner that will have positive results. If the tools are not well planned and executed, then the desired results may not be acquired.
Recommendations for Future Diversification
The future adventurous diversification endeavors of Amazon.com Inc. require maximizing the outcome as opposed to the electronic devices production attempt. However, for that to happen, two significant things need to be done. The first one is an investment in research. The company should deploy a research team at various levels. There should be a diversification research team that looks for ideas that have potential opportunities and bring them to the management. The second team should deal with the specific ideas, doing feasibility to determine their practicability. The second recommendation has a market study team. Market evaluation is affiliated with research but is unique since it focuses explicitly on the market. Product strengths and weaknesses, as well as levels of competition, are only determined through this activity.
Conclusion
The recommendations above will help Amazon.com Inc. to be successful in future diversification attempts. The analysis conducted lead to these recommendations because they reveal the need for research and innovation before deciding to diversify. It also indicates how the two tools should be integrated to become complementary to each other. The analysis offered gives Amazon.com Inc. a chance to correct the mistakes it may have made before as it tried to diversify. Evidently, the company had not done a proper market study of the goods before they started production. There were already strong competitors that had the excellent stamina that was not easy to beat. Therefore, a different product or more innovation onto the products would have done better. However, future attempts to diversify with conformity to the recommendations, in this case, will lead to maximization of results.
Works Cited
Bowman, Douglas and Hubert Hatignon. Market Response and Marketing Mix Models: Trends and Research Opportunities. Boston, MA: Now Publishers Inc, 2010.
Delarue, Anne, et al. "Teamworking and Organizational Performance: A review of Survey-Based Research."
International Journal of Management Reviews (2008): 127-148.
Satell, Gray. "The New Marketing Paradigms: Social Networks, Chaos, and Memes." DigitalTonto 17 10 2010: 10-12.
Spector, Robert. Amazon.com: Get Big Fast. New York, NY: HarperCollins, 2009.
