Applying the “How might we” framework to Amazon

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 Applying the “How might we” framework to Amazon 

How might we mitigate supply chain disruptions? 

In an everchanging environment like nowadays world, various events can cause the appearance of disruptions in logistics (Hopstack, 2022). These events cause delays, which negatively affect Amazon’s revenue and its reputation with customers.  

The “framed” approach: Investing more money in supply chain procedures, to statistically lower the chances of disruptions. However, this would probably require immense amounts of investment, which means that this option is not the most feasible one. 

The “out-of-the-box” approach:   

  • Each time a vendor or customer experiences delays due to such disruptions, provide them with compensations in form of discounts or points in later purchases within the retail platform. In this way, keeping both groups loyal to the service, and avoiding the loss of reputation and/or customer base. 

  • Develop predictive models using Artificial Intelligence and Machine Learning models, in this way being aware and having better insights of possible future supply chain disruptions. 

How might we regulate competition in retail? 

Amazon allows an excessive number of vendors to sell the same product, and it does not apply strict filters for them to post such products in its marketplace (Hopstack, 2022). On top of this, it is even harder for vendors to deal with competition since the Amazon marketplace is composed by vendors from different regions, which can penetrate markets due to lower costs in their own regions (Hopstack, 2022). 

The “framed” approach: Isolating regional markets to directly protect small and medium local vendors against bigger and more competitive foreign vendors. This approach is clearly not feasible since Amazon would lose huge amounts of revenue coming from international e-commerce. 

The “out-of-the-box" approach: Making changes to the Amazon search engine codebase could be made to preferably show local products instead of imported ones. At the same time, the platform can be modified to highlight products sold by smaller vendors. Both measures should help to avoid a monopoly of vendors within the marketplace. 

 

How might we avoid counterfeiting and Intellectual Property violations in retail? 

The sideral number of vendors in the Amazon marketplace brings a concerning influx of goods which go against copyright laws, and at the same time it poses a big challenge to solve (Hopstack, 2022). This context has very bad consequences for the platform, affecting customer loyalty, and making it harder for vendors to assert their legitimacy (Hopstack, 2022). 

The “framed” approach: Applying an stronger anti-counterfeiting\Intellectual Property policy in the platform. This solution is purely lineal and might not be effective, considering the exponential increment in the number of sales in the platform (Statista, 2024). 

The “out-of-the-box" approach: An interesting solution to this issue would be providing rewards to those users, vendors or customers, who report such illegal products. The reward given to them could be in the form of points or discounts. Firstly, this would incentivize users in general to help to the cause due to fact they are being rewarded. Secondly, vendors might get doubly benefited since they will help asserting their legitimacy, and eliminating fake low prices which might be extremely competitive for them, incrementing significantly their incentive. 

How do we improve (analytics) reporting for vendors in retail? 

Vendors face a burden when dealing with different data from their operations in the Amazon marketplace, due to the complexity of the operations and the analytics report system given by the platform (Adlucent, 2023). 

The “framed” approach: Directly increasing the capacities of the analytics report system, adding new features that provide deeper analysis in the operational data. 

The “out-of-the-box" approach: Implementing an API (Applicable Programming Interface) to the reporting system, in order to allow plugins from third parties. This would make the reporting tools more flexible and create a community of developers and vendors around a diverse ecosystem of such plugins. 

 

Sources: 

[1] Hopstack. (2022, February 10). Amazon FBA in 2023: Biggest Challenges and How to Overcome Them. Www.hopstack.io. https://www.hopstack.io/blog/challenges-faced-by-amazon-fba-sellers 

[2] Amazon: annual revenue 2018. (n.d.). Statista. https://www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom 

[3] Adlucent. (2023, March 13). The Top Three Amazon Challenges, And How To Solve Them. Adlucent. https://www.adlucent.com/resources/blog/the-top-three-amazon-challenges-and-how-to-solve-them/ 

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