Assess Amazon’s decisions to diversify into e-readers (Kindle) market

Assignment:

• Porter’s essential tests
  • Attractiveness tests: is it attractive
  • Entry cost tests: is it costly to build up?
  • Better-off tests:
    • It is not the diversified business that is being made better off by the presence of its core business, but the reverse: by encouraging the adoption of e-readers and ensuring that they are compatible with Amazon’s format for the electronic versions of its books.
    • Hence, the source of this synergy is not the usual economies of scope in resources and capabilities. it is demand side economies of scope: books and e-readers are complementary products from the customers’ point of view.

Textbook link:

https://www.academia.edu/35804421/Th.Edition.Wiley.Contemporary.Strategy.Analysis.Text.and.Cases.Edition

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