Case ID 18-1084
Published 2018
Industry MAIL-ORDER HOUSES AND DOOR-TO-DOOR SALES
Industry Code 611
Subject Competitive strategy


Abstract Amazon is one of the biggest success of the American high-tech history. The company has limitless expansion plans in terms of business sectors and geographic areas. However, its ambitions have encountered one big obstacle: the Chinese e-commerce market. Amazon has revolutionized the retail industry. It is the biggest e-commerce company in the world in terms of market capitalization. Its brand image is one of the strongest in the world according to many studies. From a mere online bookseller in 1995, Amazon has become a technology juggernaut after a dazzling and lightning ascent. Amazon’s aim is to become “the everything store”: a place where customers can find all they want and need. To reach that objective, Amazon has greatly broadened the scope of its business. Nothing has seemed able to stop Amazon. The American giant has now a global reach: it operates e-commerce websites in 14 countries around the world. Amazon is the e-commerce leader in many of the markets it has tackled. The American company is determined to go further into its internationalization process. Nonetheless, the American high-tech giant is struggling to exist in the largest e-commerce market in the world. Its Chinese subsidiary only had a tiny 0.8% of market share in the Chinese B2C market sales in 2016. The firm looks totally overwhelmed by the two main Chinese leaders, Alibaba and JD.com. How a company as powerful as Amazon has failed to set a significant foothold in one of the most dynamic e-commerce market in the world? Can Amazon still recover from its missteps? The case highlights the main reasons for Amazon’s difficulties in China by explaining its mistakes and the key strengths of its main competitors. It also gives some solution hints that could help Amazon to find its sweet spot in the Chinese market.
Pages 34
Teaching Note Yes