Customer Services at Amazon - Case Study Example

Executive Summary Amazon.com is the leading online retailer in the world which started as an online bookshop however, over the period of time; it has been able to diversify itself and is now offering a large and diversified range of retail products. Amazon.com has been able to achieve consistent growth and praise for its customer’s services consistently over the period of time. The overall model of customer services at Amazon is based upon delivering services in timely manner. What distinguishes Amazon from others is the fact that it has been able to develop a comprehensive eco-system which services its customers’ needs. This eco-system is based upon using different online and offline components which combine together and deliver the consistent excellent customer experience. In order to improve its overall customer services and experiences, it is important that the Amazon must be able to improve its rating system. Probably the key variable which helps customers to make the purchase decision is the ratings and reviews by the users which invariably help other customers to make the decision. However, a further refinement in the rating system can improve the overall transparency of the system to make better recommendations. Introduction One of the key strategic aspects of the organizations is based upon how effectively any organization actually satisfies and fulfills the needs of its customers. Having happy and satisfied customers makes the organization more acceptable towards its target market. Over the period of time, various studies have clearly outlined as to how consistent and sustainable customer services can deliver the results and add into the overall bottom line of the organization. Amazon.com is the largest online retailer in the world which started as an online bookshop however, it successfully ventured into one of the most successful retail organizations in the world. What made Amazon.com successful is its relentless focus on the customer satisfaction and improving its services to satisfy its customers. Right from offering a large variety of retail products and services, Amazon.com has focused upon delivering excellent customer services by facilitating its customers through various ways. Its current approach towards customer services is based upon offering a focused but socially diverse range of services where customers are being delighted through different ways. Right from offering free delivery services to the customer reviews, Amazon is focused upon delivering consistently high value for its customers, suppliers and self-publishing authors selling their own books through Amazon. (Bradley, Kim, Kim and Lee, 2012) This report will discuss and explore the current approach towards customer services by Amazon.com besides exploring various customer services frameworks. This report will also make recommendations in terms of how the overall customer services can actually be improved to secure or achieve the sustainable competitive advantage by Amazon.com. Customer Services at Amazon.com Amazon.com is the online e-commerce company based in Washington, US however, it operates at various other markets. It is the largest online retailer in the world which started as a bookstore however; it started to diversify from early on by selling other electronic items such as DVDs, electronics, clothing and other items. Over the period of time, its overall range of offerings increased wherein Amazon.com now offers a comprehensive range of products and services. It has also entered into the computer and smartphone industry where it is also offering its own e-book reader along with the tablet pc. (Clarke, 2001) The story of Amazon.com therefore is one of the fascinating stories of success whereas an organization successfully diversified itself into different segments of the market. One of the keys to the success of Amazon is its ability to offer excellent customer services and making customers to become the repeat customers through a combination of different services which make customers to keep coming back. Based upon the notion of digital innovation, amazon has focused upon combining its overall customer services with that of the high quality technology oriented services making for it relatively easier to trace customers from the start to finish. (Jones and Kober, 2010) What is critical to note that the customer services of Amazon.com has been consistently rated as number 1 across all the markets it operates. The survey by the UKCSI also clearly outlines as to how much customers are satisfied with the services of amazon.com and how it is actually paying off in terms increasing the bottom line of Amazon. A closer analysis and review of the Amazon’s customer services would suggest that it is mostly based upon offering excellent value in terms of service delivery. Amazon has been phenomenal in offering quickest delivery of services at the doorsteps of the customers and has been famous for delighting and even amazing its customers with quick and efficient services. Amazon has been able to achieve and maintain the customer loyalty through its excellent service delivery where it has now combined both the digital as well as physical delivery channels to improve this major aspect of its overall customer services. (Cook, 2011) A key aspect of the Amazon’s customer service is delivering a consistently high customer experience when customer shops around on the website. Apart from offering real quick and free delivery services, Amazon has also focused upon offering a diverse and relatively best customer experience to its customers. This is primarily achieved through offering real-time reviews of the products and books by the real customers who bought the products. By doing this, Amazon actually makes it social for its customers to evaluate and read the reviews of other customers before making a decision to buy. What is also important to note that Amazon encourages its customers to leave their reviews in order to help others to make better and more informed decisions. This results into customers gaining better insight about the product itself before the actual decision to buy is made. (Dietz, 2005) From the point of view of the overall service experience, a typical customer at amazon is served not by a physical service worker but by the online web portal of amazon. This online web portal not only helps the customer to conclude the overall process of buying i.e. from choosing a product to checking out however, it also makes the recommendations for buying other related products. The overall service settings of the amazon therefore are based upon offering a smaller and simpler online services which increase the overall experience of the customers. (Snow and Yanovitch, 2010) The one-click service of Amazon actually allows the customer to buy the products without actually using their credit cards every time they make the purchase. By seamlessly integrating the one-click payment services, Amazon has been able to actually improve the experience of its service customers who receive the services.   3 R’s Model Amazon has been able to implement an intelligent algorithm which allows it to put forward reviews and recommendations of real time customers. The referral factor therefore is being taken care of through offering real time reviews from the customers which are also being rated by other customers. This allows customers to actually search for the reviews and helps Amazon to earn the referrals. Retention aspect of the customer services is being taken care of through the combination of different factors. Amazon not only encourages its customers to post their post-sales reviews on its websites but also makes it easier for the customers to come again through a clever combination of discounts, free and early delivery etc. The free credits also allow customers to actually buy at discounted prices. Apart from this, Amazon has effective after-sales services in place which effectively deal with the returns and refunds thus filtering out the cumbersome processes to allow customers to get easier and hassle free services. The repeat business is mostly generated through the overall loyalty being generated through retaining the customers. This is achieved through gaining the trust of its customers through an excellent customer services. The 7S model Considering the overall customer excellence model from the perspective of the 7 S model would suggest that organization may be adding up value to the overall customer excellence through different layers. The overall structure of the organization is multi-divisional in nature with active involvement of CEO Jeff Bezos in almost every affair of the organization. As such the overall structure of Amazon is relatively hierarchical in nature.  (Faulkner, 2003) The strategy to deliver the excellent customer services however, is based upon delivering excellent customer services. The overall nature and design of the Amazon’s online portal suggests as to how it has been actually supporting the overall strategy of the firm. What is also important to understand that the shared values of the firm are based upon offering a one place comprehensive portal to offer almost everything under the sun? The overall style at the organization is that of offering a holistic approach towards the customer excellence as it is also because of this that Amazon has been able to develop a comprehensive ecosystem where it is not only delivering excellent customer services but it is also maintaining its overall ecosystem through effective relationship with its suppliers, authors and all other stakeholders. Since Amazon is an online firm therefore its staff does not interact with the customers however, it has been able to set up customer services telephone lines to help its customers deal with different issues. It is critical to note that Amazon’s overall customer excellence is transformed through its various layers of staff i.e. a combination of the technical staff and the customer services personnel. As such the overall skills of the staff are being gelled together at various levels to offer a comprehensive and effective customer excellence through efficient and seamless online portal. Above all, the systems in place at Amazon suggest that they have been able to support the overall customer excellence motto of the organization. Amazon has been able to develop a comprehensive eco-system wherein it has not only been able to establish its distribution and fulfillment centers at various physical locations but it has also been able to develop and put in place online systems which allow authors and individual smaller and casual sellers to sell their products online without actually going through other hassles. (Lindic and Silva, 2011) Conclusion Considering the overall level of customer services offered by Amazon, it is clear that the organization has been able to deliver customer excellence through a combination of different factors. However, one aspect of the customer excellence which distinguishes Amazon from others is the simple and easy customer experience offered to the customers when they shop online. However, in order to achieve the same, Amazon has been able to put in place structures and systems which allow it to deliver such effective customer services. The combination of various online and offline service delivery components therefore allow Amazon to actually deliver consistently high level of customer services. Recommendations Though Amazon.com has been rated number in terms of customer services however, it may still require certain important improvements in order to ensure that it can generate competitive advantage through its customer services. One key recommendation to improve the overall customer excellence at Amazon is to actually improve the overall process of understanding the customer. Currently, Amazon is focused upon offering related products based upon the shopping habits and the reviews of other users. However, there have been concerns regarding the rating system of the Amazon indicating that the system as a whole may not be as transparent as it is actually projected. In order to actually improve the overall customer experience and to offer genuine and transparent reviews, Amazon can actually further enhance its user experience. (Bercovici, 2013) Fake reviews are the reality in Amazon and a potential weak link in its eco-system of the services. To improve the reviews and ratings, Amazon has to come up with innovative solution to actually desist sellers from buying fake reviews and influencing the purchase decisions of other customers. It needs to make improvements in its overall algorithm to ensure that transparent and fair reviews are being posted by the customers which can help spread the word of mouth and also improve the confidence of customers in the overall rating and review system of Amazon.com. (Charman-Anderson, 2012) References Bercovici, J. (2013). How Amazon Should Fix Its Reviews Problem. [online] Forbes. Available at: http://www.forbes.com/sites/jeffbercovici/2013/01/25/how-amazon-should-fix-its-reviews-problem/ [Accessed 30 Apr. 2014]. Bradley, S., Kim, C., Kim, J. and Lee, I. (2012). Toward an evolution strategy for the digital goods business. Management Decision, 50(2), pp.234--252. Charman-Anderson, S. (2012). Fake Reviews: Amazons Rotten Core. [Online] Forbes. Available at: http://www.forbes.com/sites/suwcharmananderson/2012/08/28/fake-reviews-amazons-rotten-core/ [Accessed 30 Apr. 2014]. Clarke, K. (2001). What price on loyalty when a brand switch is just a click away?. Qualitative Market Research: An International Journal, 4(3), pp.160--168. Cook, S. (2011). Customer care excellence. 1st ed. London: Kogan Page. Dietz, J. (2005). Fundamentals of customer-focused management. Journal of Consumer Marketing, 22(4), pp.233--234. Faulkner, M. (2003). Customer management excellence. 1st ed. Chichester: Wiley. Jones, M. and Kober, J. (2010). Lead with your customer. 1st ed. Alexandria, Va.: ASTD Press. Lindic, J. and Silva, C. (2011). Value proposition as a catalyst for a customer focused innovation. Management Decision, 49(10), pp.1694--1708. Snow, D. and Yanovitch, T. (2010). Unleashing excellence. 1st ed. Hoboken, N.J.: Wiley. Read More