The launch of fire phone took place on the 18th of June 2014 with the aim of it competing against smartphone giants like Apple and Samsung. As part of Amazon's expansion to more product categories the fire phone smartphone however despite a flashy launch failed to succeed in the market with customer raising several concerns not met. Amazon took a huge loss, and many fire phone smartphones remained unsold.
Fire phone failed in the market due to several reasons below:
Pricing: given that they were new entrants in the smartphone world the high price tags on the fire phone almost the same as that of apple and Samsung galaxy put off interested customers. Despite realizing this and lowering the prices the damage was done and could not turn things around failing.
The product itself: fire phone smartphone runs on Android and due to that had smaller apps for people to access in the app store. The small space for the many apps inconvenience users who are used to larger app base in phones such as apple. Inability to satisfy customers on this end made it fail in competing with the more advanced smartphones produced by Apple and Samsung. Lack of the quality features that consumers want in a smartphone failed to compel many customers to walk into stores and buy them.
Market: Fire phone coming out in 2014 was a bit late entrant into the market as other companies such apple and Samsung are on their eighth series of smartphones which have improved gradually over time. Starting at this point contributed to their failure owing to their little experience which could not match the giants.
Competition: high level of competition in the technology industry has made it very hard for new companies to penetrate the market no matter how good the product is. Fire phone produced by Amazon failed to recognize this and swiftly launched their product without considering it. Failing to recognize how unpredictable these products led to mass production of smartphones that never reached the market.
Buyer behavior: Amazon.com failed predict the behavior of buyers by taking too long to learn ways to promote the product to attract customers continuously. Lack of after sale services that could encourage the buyers to buy fire phone contributed them not to take a keen interest in the product. Being a late entrant in this field seems to be to their disadvantage, and their product lags the most common features most consumers look for in a smartphone.
Assumptions: to make the strategy work amazon as a company should have considered understanding the nature of their product they would like to introduce to the market. After doing so and in this case the product is a smartphone they should ask themselves whether they can produce smartphones with quality as those currently in the market. Amazon assumed because the Kindle e-reader succeeded in the market introducing a smartphone would also be successful. Focusing on what customers like about other smartphones is important to incorporate and improve on them on the new product.
Benchmarking other companies and taking notes on what strategies have been working for them to survive in this market over the year. Having such information enables the company to manage expectations and be prepared to face unforeseen challenges in the market.
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