Rethinking the strategy of Amazon.com

The strategic challenge facing Amazon.com is that it is not able to convincethe investment community that it is able to generate profits in the long run. The doubtof investors is well grounded. This paper argues that Amazon should make a strategicshift to operate as a provider of technical services and business consulting in the areaof business-to-consumer e-commerce. At the same time it should reduce the range ofthe items sold on-line to, say, books and CDs, and treat this part of its business as akind of research and development activity. Its avant garde status as e-commerceinnovator and its track record in customer satisfaction have tremendous market valueand can serve as an 'open sesame' to enter the huge market of e-commerce consulting.Its continuing survival and (hopefully) future profitability hold deeper implications forother dot.com companies and B2C e-commerce.