Amazon In Strategic Repositioning – Expanding U.S. Market Presence While Making Staff Cuts In India

Amazon is taking steps to grow its merchant relationships in the U.S. It is making its “Buy with Prime” service available to U.S. merchants on January 31, 2023. This move is important since it will be an effort to work with other on-line stores to give Amazon a broader role across the market.

Amazon is competing with Walmart+ and Shopify as it ramps up to be more competitive with any rivals.

Another new feature is the permission for third-party vendors to display ratings and reviews of products. That is very important because it highlights merits of featured products from third party vendors. Sometimes, with multiple vendors of the same a product, “Amazon choice” will highlight a good product.

In addition, E-commerce provider Big Commerce announced an app this week that its customers could use to easily integrate “Buy with Prime” into their on-line stores. Shopify said in October that it was talking with Amazon about how to implement “Buy with Prime” as well. No progress on those discussions is yet available.

At the same time these growth efforts are underway, staff reductions are going on. In an effort to trim staff, CEO Andy Jassy has acted and cut 18,000 positions. While most layoffs are in the company’s stores and human resources, Amazon’s India Division surprisingly is also affected. According to a study I published about two years ago, Amazon has over 60% of the Indian e-market, and it would not be a surprising if that number has risen since that time.

Amazon’s management has told some corporate employees in India that their roles are being eliminated. Lay-offs are supposed to start January 18, though uncertainty seems to be felt among employees. According to The Information, a technology focused media company, Amazon had already made some cuts in November when it laid off 2,000 employees in the devices division. That division works on products like the Alexa voice assistant and Kindle e-reader.

Jassy wrote to his employees last week,” Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so. These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I am also optimistic that we will be inventive, resourceful, and scrappy in this time when we are not hiring and eliminating some roles.” It is a call to all associates of Amazon to be innovative and creative even while potentially disruptive restructuring goes on.

POSTSCRIPT: Clearly Amazon is getting ready to be competitive in what it predicts will be a changing marketplace. It is preparing for a downturn of the economy. More people will be able to shop with Prime and the company’s smaller group of associates will strive to survive. The actions signal that the company anticipates that it is likely that basics will be in demand, but technology-based products and specialties will be less in demand.