Future of Amazon Kindle

Black Friday was a red hot for Amazon.com.

according to a statement released by Amazon, the Kindles sales rise 400% compare to last year's black Friday. at the same time, amazon.com was also the most visited retail site, with 50% more traffic than other top retail sites like best buy; target; even apple.com

not only during holiday season but year round, we can see more and more consumer choose to shop online instead of going to the stores. according to internet research marketing company comScore,  more than 50 million Americans visited online stores this black Friday. where they spent $ 816 million, an increase of 26% since last year. 

the core of Amazon is the online store, and it is also part of what Kindle is. without the Kindle book store, Kindle e-reader wouldn't be any different from the SONY e-book or the NOOK. Kindle fire attracts a different group of consumer, they may not be reading as many books as the original Kindle owner. but they will hopefully shop just as much. As Jon Philips writes at Wired, "Indeed, the Fire is a fiendishly effective shopping portal in the guise of a 7-inch slate." 

research also shows that even though Apple device had 80% of the North American tablet market in the second quarter this year, and 65% of the future tablet buyers are still considering I pad as their 1st choice. Kindle Fire DID landed the second place as of Nearly 1 in 4 future tablet buyers prefer Kindle Fire. leaving barely 13%  market share for all other tablet devices. 

with a retail price of $199 verses iPad's starting price of $499, the two are really targeting a totally different segment of the market. that means, to a large extent, they are clearly NOT competing for the same buyers.

Amazon created the Kindle ecosystem with a vision of the whole company's future. which i agree with what Rebecca J Rosen at the ATLANTIC magazine wrote: 

"...the Kindle Fire is our best and latest clue as to what Amazon's vision for what  Amazon's vision for that future is: the Internet as a store--- and that store is amazon. As Amazon continues to increase its offerings beyond Amazon.com, expect those offerings(tablets, e-readers, apps) to always in some way have the growth of Amazon.com's sales as a fundamental purpose."

Kindle maybe the number 2 product in the gadget market . but its number one spot as a e-book is unshakable. This Kindle system has a lot of space to grow -----with the enhancement of Amazon cloud and Amazon music, i see a very bright and profitable future.

reference: 

www.huffingtonpost.com --- amazon kindle set black Friday sales records

Rebecca J.Rosen  -What the Kindle Fire Says about Amazon's vision for the future-- the Atlantic -TECHNOLOGY- NOV 14 2011

chapter 15 Retailing

where to buy Kindle?
1. online at amazon.com
2. at any best buy
3. some Target store and target.com
4. some airport gadget vending machines

chapter 7 business marketing

business marketing is the marketing of good and services to not only individual but also businesses, for the purposes  of making a different product with it other then personal consumption.
amazon Kindle buys most of its parts, therefore it is a participant in business marketing  .like i posed before in the riposted extra page：

• The electrophoretic display is made in Taiwan because the expertise developed from producting flat-panel LCDs migrated to Asia with semiconductor manufacturing.
• The highly polished injection-molded case is made in China because the U.S. supplier base eroded as the manufacture of toys, consumer electronics and computers migrated to China.
• The wireless card is made in South Korea because that country became a center for making mobile phone components and handsets.
• The controller board is made in China because U.S. companies long ago transferred manufacture of printed circuit boards to Asia.
• The Lithium polymer battery is made in China because battery development and manufacturing migrated to China along with the development and manufacture of consumer electronics and notebook computers.

chapter 8 segmenting and targeting markets

when Amazon Kindle first came out in 2007, it seemed to be targeted to early adopters---- people who like new gadgets, yet later on, from reviews and Amazon.com discussion boards, the company found that regular people, not gadget guys, are buying the Kindle in droves.  this maybe part of the 'Oprah effect'.
i just found out that back in 2008, Oprah did an episode on Kindle with CEO of Amazon Jeff Bezos. please see video at (http://www.oprah.com/oprahshow/Take-Jeff-Bezos-Amazon-Kindle-Class). data shows that women handle 75% of family finances and make or influence 80% of consumer purchases(MKTG chapter 8 4262-86) . through the Oprah show, Kindle got the quick exposure it needed towards female audience, and became a trend among house-wife and female professionals.
 how Oprah.com demographic fit in to Kindle Target Market

US Demographics 

Updated Nov 18, 2011 • Next: Nov 30, 2011 by 9AM PST

		INDEX
30%	Male
70%	Female
13%	Under 18
36%	18-34
30%	35-49
21%	50+
77%	Cauc.
11%	Afr. Am.
4%	Asian
7%	Hisp.
1%	Other
		Internet Average

		INDEX
60%	No Kids
40%	Has Kids
19%	$0-30k
28%	$30-60k
28%	$60-100k
26%	$100k+
35%	No College
48%	College
17%	Grad. Sch.
		Internet Average

Kindle
42%        Male
55.9%     Female
2.3%       17 or younger
22%        18-34
38.4%     35-54
37.3%     55+
because the price of a Kindle has drop dramatically since 2008.  this demographic(Apr.2011) is going to change.
Amazon.com has never officially disclose this demographics of Kindle user. the data above was collected by individual researcher via online survey.(see the survey result page)

chapter 11 developing and managing product

developing a new product in an existing product line not only help a company attract new customers from the target market to buy, it also pushes existing customers to renew/update/upgrade the product they already have.
Amazon Kindle has recently developed a new product line----- the kindle Fire, and improved its existing Kindle e-reader. all of those development were done right before the Holiday season. on top of this, Amazon Kindle also lower the price of kindle.
clearly, Amazon Kindle recognized the competitive advantage of an I pad (its color display). a need for an improvement is therefore unavoidable. ruling out the possibility of  using colored e-ink technology which still need to be further perfected. Kindle used the same type of display as an Ipad. the biggest different from a Fire and an Ipad is that the Kindle Fire runs on android platform (as used in smart phones).  the biggest selling point for the Fire will be Amazon's very own web browser, the Amazon Silk.


personally, i think Kindle Fire still need a lot of work, it commercialized too quickly. i sure acknowledge that holiday season is the golden time to push a new product. but with only the older android platform, it may mislead buyer to think that the Fire isn't "smart" enough. this will eventually cause depreciation of the product and douse the desire of many potential buyer.
its like putting a picture of the Eiffel tower in front of the Eiffel and letting people choose... the answer is obvious...

 

chapter 10 product concepts--------TRADEMARK

I question the future of Amazon Kindle.
 Just like Apple's iPod, amazon's Kindle has a unique look that is easily recognizable . but HOW LONG is this  look, along with  the "not-so-new-anymore" e-ink technology going to be part  of Kindle's brand identity?
with no protection over the Design of a Kindle . it has been pirated in the far east. (see article below)  those cloned product can easily distract potential buyer who didn't do enough research on the product ------the major advantage of a Kindle over other e-reader is its easy WIFI distribution channel and  its impressive book selection.

FOLLOWING  ARTICLE WAS PUBLISHED  ON http://www.pocket-lint.com/  

 

Amazon Kindle gets cloned

Wannabe gadget spotted

13 July 2009 9:23 GMT / By Amy-Mae Elliott

• inShare

Spot the difference between this Chinese Kindle clone and the real dealfrom Amazon. Okay, so the characters displayed on the screen might give it away.

The device - due out in Japan for around $210 at the end of the year - is called the WEFOUND, presumably as in we-found-this-Kindle-and-decided-to-copy-it.

----------------------------------------------------------

PLEASE GO TO THE EXTRA PAGE IN MY BLOG TO READ MORE ON THE E-INK TECHNOLOGY : 

after research, i found out that the Kindle's E-ink technology is made by a Taiwanese company, Prime View International, Inc. (PVI) (now, E Ink Holdings Inc ) they make e-ink displays for not only e-readers; indicators;cell phones, the technology is also used on computer keypads; watches and smart credit card.........................

who is using E-INK :http://www.eink.com/customer_showcase_eReaders.html

http://goodereader.com/blog/electronic-readers/what-is-e-ink-pearl-and-e-ink-triton-technology/

http://www.geek.com/articles/gadgets/e-ink-promises-thinner-lighter-higher-resolution-and-color-e-paper-displays-2011095/

http://en.wikipedia.org/wiki/Electronic_paper

http://techworldtop.com/concept-tablet-electronic-ink#more-1276

chapter 18 sales promotions and Personal selling

With this weeks topic on sales promotion and personal selling, i found very little information since Amazon Kindle does not use personal selling at all. it's distribution are mainly web based through Amazon.com. you can also buy selected kindles at some BESTBUY and TARGET (Target sales Kindle in selected stores only, to find out which Target store sells Kindle please click here).

In terms of sales promotions, Kindle has an on going promotion of Free shipping when you buy any Kindle device. but there is hardly any discount other then that.there was an $30 discount offer, which ended this October.

When you are on your search engine, you might come across a lot of Kindle discount code. to save you time and energy, i can tell you now to stop click on those advertisement. because after spending hours watching YOUTUBE video on it and clicking through them myself, i have found that most of them are either for Kindle accessories or Kindle discount for countries other than the U.S.(mostly in UK since i searched in English)
However, Kindle books are cheap comparing with hard copies. Kindle e-book are normally priced at $9.99 each,on top of that, Amazon unveil a monthly collection of 100 Kindle books for $3.99 or less. those promotions influence consumers a great deal. after all, Kindle is not only a electronic product, it is a book delivery service.

I also think it would be unrealistic for Amazon to give any further discount on Kindle. the retail price for Kindle dropped from more than $300 to what is now at $79 to $149 (depend on model). according to the unofficial-blog-Kindle (article linked) the cost of making a Kindle 4(retail at $79) is about $113. so Amazon is, in fact, losing money selling the new Kindle device.*(Amazon doesn’t loose money on Kindle 4 non-touch. Even with retail component prices, manufacture costs come very close to what device sells for. Kindle with special offers has been around for a while so it is safe to assume that Amazon know how much money they are going to make from advertising in the long run and it is reflected in $30 discount and the fact that you can remove special offers from your device for the same price of $30. It also seems that there is still room left for price reductions in the future.)
But why is Amazon "giving" Kindle out?
in my opinion, the low price help Amazon eliminate nook from its competition and gain compatibility with Apple products. its trying to gain market share to its full potential.
to read more please go to this link

"Kindle is a decade long investment in a media consumption and distribution ecosystem"-----Business Insider

chapter 17 Advertising and public relations

Amazon uses several approach when it come to the product advertisement of Kindle.

execution styles of advertising that was used on Kindle's TV commercials includes :slice-of-life; spokesperson and fantasy

 the TV commercial A uses typical consumer as spokesperson. a regular guy who has a Kindle explaining  the benefit of Kindle to his friend---- Kindle's ability to hold thousandths of books and magazines in its light weight body. this was one of the first Kindle TV commercials. this one was designed to attract new users who like to carry books with them just like the girl in the commercial. the other commercials in this same advertising campaign also showcased Kindle's 60seconds WiFi book down lode and more.

this second commercial, which still features typical consumer, is a fine example of a comparative advertisement. this commercial showcased the e-ink technology which allow users to read in the sun and the fact that it is very affordable.both are advantages towards its competitor in this case Apple's I-Pad.    the 3ed commercial is an example from  the second   TV commercial campaign that Amazon used. it features blithe music and dramatic image of  a girl getting in to the scenes of the book that she was reading on Kindle. this commercial bring a fantasy to viewers. It takes viewer to the magical world of books and give that feel of reading brings joy and Kindle makes it easy.

the last two examples are the latest TV commercials of Kindle."THE BOOK LIVES ON" is the new slogan. This series of commercials uses lively music and regular Kindle users in a normal setting, it  not only illustrated the merit of Kindle but also gives the idea that kindle has become part of our daily life.

chapter 6 consumer decision making

On a rainy afternoon, as I was seating by my window reading the definition of subculture from my Kindle DX. I stared to wonder who the Kindle users are.

As a kindle owner myself, I analyzed the reasons why I got Kindle in the first place:

              As a student, I purchase second hand text book on amazon.com. When Kindle first came out, I saw the advertizing on the website. At the moment, I didn’t really pay much attention to it. Until one day (that was about 2 years ago) I saw one of them lying on my boyfriend’s bed, it’s smaller and lighter than what I had expected. I went online to do some more research that day after I got home and made a decision to buy is because I m just so tired of carrying books with me on the train and not able to read it. (imagine a girl on the subway with a one shouldered hand bag filled with textbook; jacket and coffee in one hand and book in the other while she is trying to hold on to something and wondering if someone can just please turn the page for her )

its ever easy free standing in a subway cart.......

              After receiving my kindle, the first thing I did was to download a whole bunch of classics that I love but wasn’t able to get to for a long time. (Since I moved to my tinny apartment in New York, most of my books are either in my storage unit or at my parents’ house in PA.) Getting back in touch with my dearest friend like Jane Austin for free wasn’t even the greatest news, what really got me committed to this long term relationship with Kindle was the prices on my text books. For example, paying only $18 for a book that retails $98(even the second hands sales about $45). Even though not all my text books are available in Kindle form, the space it saved on my shelves and the portability of it makes me smile every day.

 What I realized is that all those problems that Kindle salved for me, like no storage space; hard to carry; price factors; no time to go to a book store or just simply don’t want to wait for shipping, were problems that a lot my fellow New Yorkers face every day too. And if getting a kindle salved those problems for me, it would do the same for them too!

Now, it’s almost imposable to not to see a kindle when you get on a subway cart. And what you see is normally a young professional rushing from point A to point B every day yet not willing to give up their reading time. Kindle has become a label for a subculture of modern; knowledge craving people in our generation. 

chapter 5--- develop a global vision

Amazon Kindle WiFi coverage map

Amazon Kindle e-reader is currently available in 122 countries. Worldwide delivery through Wi-Fi works in more than 80 countries. in addition, Amazon Kindle app works on all common PDs, user can perches books and apps on their computer or smart phone easily. Amazon Kindle is definitely a globalized product even though there are still many complains on amazon.com ’s not so united global service.(more info on the amazon.com global delivery service problem please visit amazon-and-the-case-of-the-missing-globalization)

chapter 4--- external environment

KINDLE’S EXTERNAL ENVIRONMENT:

SOCIAL

With its high-contrast E ink screen with pearl technology and 1/3 inch, 8.5oz pocket size, kindle become the device for readers. You can not only buy books through the build in free wireless and start reading in less than a minute; there are also over 1.8 million out of copyright, pre-1923 books free for download.

DEMOGRAPHIC

              Kindle targeted readers any age even elderly----  You can not only adjust fount size, the Kindle can also read for you.

ECONOMIC

              Amazon has definitely become more affordable. Its retail price dropped from the introductory price of $399 to the latest generation with 3G and WIFI at $139.

TECHNOLOGICAL

Kindle is currently on its 7^th model. (3^rd for Kindle DX)

COMPETITIVE

              Kindle’s competitors are Barnes and Noble’s nook and Sony’s e-book. I Pad from Apple and other PDAs like blackberry also take a small part of the market.

Kindle’s competitive advantages are

              Direct publishing

              Book Price

              Free WiFi anywhere you go

              Long lasting battery