Amazon Web Services (AWS) is a division of Amazon that provides cloud computing services to Amazon itself and the outside world. AWS’ main customers include individuals, companies, and the government seeking to host their websites, storage space for holding massive databases, and processing power for running sophisticated software remotely. The main product offerings include networks, servers, mobile computing, storage, and security (Cloud, 2011). Additionally, AWS has gained massive popularity in the recent past due to its ability to save customers the cost of running their own hardware and has established operations in 18 global regions. Each region is fully independent, which allows the company to be more stable and secure. AWS was initially introduced in 2002, but as of then, the platform comprised of just a few tools and services. However, it was officially launched in 2006 by the founder and vice president, Andy Jassy. It consisted of three main service offerings, including S3 cloud storage, SQ3, AND EC2. Since then, the subsidiary has been on an upward trend growing rapidly in terms of customer base and revenue growth.
The idea behind launching S3 was to help developers with handling their data. The company sought to aid developers with storing huge data, keeping it safe and secure, making it available when needed, and at an affordable cost (Wittig, Wittig & Whaley, 2016). In 2016, Jassy became the subsidiary president, which was an indication of the success of the division. AWS has had great milestones in the recent past, which have ensured growth and profitability. For example, it began offering training and certification upon successful completion of the cloud computing course to computer engineers in 2013. In the following year, AWS entered into a strategic partnership with APN to help AWS-based firms to grow. Moreover, in 2015, it achieved its expansion mission by acquiring an Israel-based, most popular microelectronics company called Annapurna for a fee near 350M US dollars. Other historical milestones include the customization of AM cores in 2018 for use in its servers. In the same year, AWS designed ground stations to facilitate easier communication with their customers.
Product Information
Amazon web services division provides a wide range of services. These include storage services, networking, and content delivery, security and identity services, internet services, messaging services, media support, analytics, migration services, and game development. AWS is also popular for offering to its customers’ management tools, developer tools, mobile services, and machine learning among others. Amazon S3, for example, is a storage service specially designed to improve cloud computing technologies storage capabilities (Varia & Mathew, 2014). With this service, developers can store huge volumes of data and retrieve it conveniently. Amazon S3 has been hailed for allowing developers to access highly scalable infrastructure similar to the one that Amazon utilizes to run its global websites. Regarding database services, Amazon relational database service (RDS) provides for setting up and operation of databases in the cloud, which allows developers and businesses to cut down on cost and time spent administering databases. As a result, businesses can focus on their core activities.
AWS server migration service enables developers to perform large-scale server migrations and to do other things, such as automation, scheduling, and tracking of live servers conveniently. This service also supports quick and secure migration of databases to AWS and supports homogeneous migration of databases, for instance, from oracle to oracle, as well as heterogeneous migrations, like from amazon to oracle. Through networking and content delivery service, AWS provides developers and businesses with an effective way to distribute content across end-users. The networking and content delivery service simplifies the network infrastructure and allows businesses to easily scale their networks as they expand (Varia & Mathew, 2014). Furthermore, developer tools, such as AWS CodeDeploy and CodeBuild, help developers and enterprises to identify the causes of errors and troubleshoot them. Also available in the AWS service offerings are the management tools that allow businesses to monitor activities. For example, Amazon Cloud Watch enables enterprises to monitor their resources in real-time. The management tools also allow for timely spotting of trends and up-to-date statistics like graphs and other analyses. The AWS web-based management tools display timely and relevant information that can help decision-makers to manage work in progress and to provide direction to help team members accomplish a project successfully.
AWS identity and access management enable a business to control access to AWS resources and services for its users. Using IAM, business owners can create access rights to users and groups depending on their roles and responsibilities. With AWS management service keys, businesses can create and control the use of encryption keys (Varia & Mathew, 2014). Additionally, corporations can use encryption keys to protect secrets on their applications and other IT-related resources. Amazon’s simple queuing service allows for the storage of messages sent and receives across computer networks, and, with this service, any computer connected to the internet can read or add messages without having to install a special messaging application. On matters of the Internet, AWS has a special service called IOT platform that allows connected devices to interact easily. Thus, with IOT platform, a company’s applications can stay in touch even when they are not connected.
Target Market Group
AWS’ market has evolved. The initial users of AWS were software engineers and developers, as well as other technologists. However, due to the growing popularity of AWS, the division now boasts of millions of customers, including small, medium, and large enterprises in search of cloud computing and other complex IT solutions (Perry & Hendrick, 2012). Today, AWS targets high-profile contracts with body corporates. For example, well-established firms like retail giants and financial institutions are running their technologies on AWS. Observers say that AWS is targeting the traditional customers of market rivals, such as Oracle, IBM< and Microsoft.
Marketing Strategies
AWS leverages several strategies, including cost-effectiveness, scalability, flexibility, security, and experience. Compared to business rivals in the computing landscape, AWS has positioned itself well on the market. For example, in terms of flexibility, AWS allows customers to use the operating systems, programming models, and architectures with which they are already conversant. With this kind of flexibility, businesses can mix architectures in a manner that allows them to address their various business needs (Perry & Hendrick, 2012). Furthermore, AWS discovered that businesses were wasting a lot of precious time, especially during systems changeover. Besides slowing operations, systems changeover acts as an impediment to responding to business opportunities. However, with AWS, migrating to new technologies is easier since the staff do not have to learn new skills. Additionally, AWS provides businesses with flexibility when procuring new services. Rather than taking months making budgets for procurement, setting up, and hiring new staff, businesses can just sign up for Amazon web service and have instant services. The flexibility that comes with AWS is a valuable asset for businesses as it allows them to concentrate on their core activities, which means that they become more productive.
Cost-effectiveness is another marketing strategy that keeps AWS ahead of other companies offering IT and cloud-based solutions in the market. With AWS, businesses only pay for what they use, no long-term commitments are required, and no upfront fee is required to use AWS services. New customers have access to new resources as soon as they sign up with AWS depending on their needs (Varia & Mathew, 2014). AWS allows businesses to respond instantly to market changes and to make the right adjustments in real-time to stay ahead of the competitors. Given that cost is the biggest impediment to achieving contemporary IT solutions, any provider that reduces the cost of deploying e-commerce application software wins the heart of millions of start-ups and the existing businesses.
Security is another marketing strategy that AWS utilizes to stay ahead in the cloud computing market. For example, AWS builds its services in line with international security standards. It provides adequate and proper security features accompanied with documentation on how to use those features in order to enhance end-to-end security. Furthermore, AWS endeavors to guarantee customers’ availability, integrity, and confidentiality of their data by offering accreditations and certifications (Varia & Mathew, 2014). the data privacy policy of AWS also requires businesses to encrypt business and personal data via AWS cloud to enhance privacy. What is more, AWS boasts of over eighteen years of experience offering large-scale cloud computing infrastructure across the world in a secure and reliable manner. In addition, AWS has a good track record of delivering quality and innovative IT solutions rapidly.
Marketing Channels and Segmentation
For many years, the Amazon web services division did not advertise, mainly because it did not need to. Its services dominated the market to the point where the word-of-mouth was just enough to put the company on top of its competitors. However, the company now faces stiff competition from web-based business rivals. In response, AWS is running advertisements in the mainstream media to popularize its cloud computing technologies to emerging and existing body corporates (Cloud, 2011). Furthermore, given that different customers have different needs and different purchasing powers, AWS groups those with similar characteristics in order to focus on the group that provides maximum value to the subsidiary. AWS uses targetable inputs to calculate the optimal segmentation of its customer targets. By using these variables, AWS is able to establish the right customer segments to focus on.
Proposals for Improvement
I believe that the Amazon Website Service’s mix of strategies is effective. However, there are concerns that AWS’s sales growth has continued to decline, primarily due to stiff competition for the cloud computing market from business rivals like Microsoft. To keep up with the increasingly dwindling market, AWS needs to invest more funds on TV ads. Television ads continue to gain more appeal as the most trusted ads that have the effect of turning around things compared to social media and other types of ads. Investing more in advertising, AWS will counter the actions of rival companies, including Microsoft and IBM, that are already investing millions of dollars in TV ads. Moreover, AWS continues to be the leading cloud provider primarily because it utilizes its own cloud infrastructure to run its Amazon.com. This feature allows AWS to drive revenues for its other subsidiaries, which is not common for the competitors. In line with this advantage, AWS should leverage more on this feature to ensure that it generates more revenues and to ensure that it taps into the customers of its rivals.
AWS should utilize the cloud space as a means to expand to more regions and to provide more service offerings. The company can also take advantage of its industry experience to create unique products and services to help emerging businesses accomplish their objectives. Currently, AWS focuses on government entities and high-profile organizations to provide cloud computing solutions. Rather than just concentrating on large enterprises, AWS should diversify its portfolio. For example, it can tap into small and medium enterprises that are emerging and require cloud-based software applications to grow. AWS can also use its wealth of industry experience to provide customized cloud-based applications to small but promising enterprises to ensure that it competes on the same level as the competitors who are already tapping into this market segment. Finally, AWS can take advantage of the cost leadership strategy and reduce the prices of its services significantly to attract as many customers as possible. Given the quality and trust that users attach to AWS, a slight drop in the price of its services would have huge impacts in terms of increasing the customer base.
References
Cloud, A. E. C. (2011). Amazon web services. Retrieved from https://s3.amazonaws.com/academia.edu.documents/27741916/running-a-website-on-amazon-ec2.pdf?response-content-disposition=inline%3B%20filename%3DAmazon_Web_Services.pdf&X-Amz-Algorithm=AWS4-HMAC-SHA256&X-Amz-Credential=AKIAIWOWYYGZ2Y53UL3A%2F20200226%2Fus-east-1%2Fs3%2Faws4_request&X-Amz-Date=20200226T082312Z&X-Amz-Expires=3600&X-Amz-SignedHeaders=host&X-Amz-Signature=f4c89c91edccbf53b5f5f3dc6c68b73e0400270b3bacd2f4a2ed681918a899a6
Perry, R., & Hendrick, S. D. (2012). The business value of amazon web services accelerates over time. White Paper, IDC.
Varia, J., & Mathew, S. (2014). Overview of amazon web services. Amazon Web Services, 1-22.
Wittig, M., Wittig, A., & Whaley, B. (2016). Amazon web services in action (p. 424). Manning.