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With a comprehensive and pervasive digital revolution, as well as demographic and socio-economic transformations, the most urgent issue is the development of new business models necessary for adaptation to a new intellectual environment. The impact of current drivers of change on the development of the economic system needs to be analyzed (The Future of Jobs, 2016). It is also good to know basic trends and understand the sectoral and regional aspects of economic, and technological transformations (De Marchi et al., 2017). This report aims to analyze the significance of drivers of change in the context of Amazon. It will stimulate understanding of the speed and magnitude of the technological, demographic, and socio-economic changes taking place today.
A part of the report of the World Economic Forum called Drivers of Change outlines the technological, demographic, and socio-economic trends affecting business models. The rise of the middle class, urbanization, unprecedented aging of the population, consumer concerns about privacy and ethics, and changing work environment are some of the factors that affect business today (The Future of Jobs, 2016). The middle class, especially in developing countries, is growing significantly, both in terms of absolute numbers and as a percentage of the total population. As people move to the cities, they become larger, which has a positive effect on the economy.
As attitudes in society change, women have an increasingly significant impact on the global economy, from growing participation in the global workforce to economic wealth and cost drivers (The Future of Jobs, 2016). These factors are the main characteristics of modernization in the developing world which leads to the changing work environments and digitalization. In the digital world, there are no geographical boundaries between countries and regions; all peoples and settlements are included in a single and indivisible digital space.
The exchange process within the global digital economy is taking on new forms. The volume of e-commerce is growing at a faster pace than conventional trade. The development of information and communication technologies significantly lowers distribution costs (Hänninen et al., 2018). The results of companies such as Amazon show that growth in online sales will grow in the future (Tu and Shangguan, 2018). Moreover, the information accessibility for the consumer allows the demand for the production of any product to be formed in advance, which reduces the danger of not selling the manufactured product.
E-commerce reduces the likelihood of overproduction crises by accelerating the sale of goods and services, the effectiveness of advertising campaigns, and the use of electronic payment services (Goyal, 2017). Tens of thousands of customers all around the world are already leveraging Amazon Web Services to reduce costs, accelerate innovation, and expand geographic coverage. AWS provides the flexibility and speeds the customers need to innovate faster.
With the rise of global delivery services such as Amazon, there is no need to be geographically close to both manufacturers and retailers today to acquire a vast array of goods. The identification, development, provision, and promotion of customer value are increasingly carried out through information technology (Chaparro-Peláez et al., 2016). The development of 3D printing technologies and the Internet of Things reduces the flow of goods and increases the information flow of digital models of goods. For example, 3D modeling from Amazon includes the creation of a three-dimensional model of the product using special software (Chaparro-Peláez et al., 2016). Consumers always want to see a product in action and its natural environment.
Taking into account the emerging trends and concerns of customers about data privacy, Amazon offers services for all layers of security, including proactive security mechanisms such as encryption and access control to device data, as well as the service for continuous monitoring and audit of configurations (Jackson and Orebaugh, 2018). AWS combines artificial intelligence and IoT to enhance device intelligence. Customers can build models in the cloud and then deploy them to devices where they run faster than other solutions (Keswan et al., 2019). AWS IoT is built on a secure and proven cloud infrastructure and scales to billions of devices and trillions of messages.
Personalization of targeting is also an important component of modern business trends affected by current drivers of change. Artificial Intelligence processes large amounts of data, making it possible to identify the global market opportunities of individual consumers, and therefore develop, promote, and deliver customized value propositions (Haggège et al., 2017). Many customers learn about most of the available products after they become subscribers.
Amazon reminds its customers about the benefits of e-books when they use Amazon Music, about music tracks when you use Amazon Echo smart speakers, or about Prime Video when they check it out ( irjevskis, 2019). In this way, the company encourages the customer to stay with Amazon. Amazon Prime continues to expand its range of services: delivery, video content, music tracks, video games, photo storage, clothing, books, magazines, and more.
The changing demographics, hyper-globalization, accelerated innovation, and digitalization are those trends that started to change the economic processes in 2015 and the impact of which are felt today. Understanding the current global trends that shape the future of the planet, market players need to be ready and look for new opportunities for business growth. On the example of the business model of Amazon, it can be concluded that the transformations taking place in the modern world associated with a change in the foundations of society are directly related to the transformation of economic activity into a new formthe digital economy.
All economic activity goes into a digital format and transfers the life of an individual into the sphere of virtual interaction, in which, using digital technologies, a persons daily life, industrial relations, and the structure of the economy are changing. One of the consequences of the influence of the global trends and digital economy on the existence of an individual is the transformation of the perception of the surrounding world.
Reference List
Chaparro-Peláez, J., Agudo-Peregrina, Ã.F. and Pascual-Miguel, F.J. (2016) Conjoint analysis of drivers and inhibitors of e-commerce adoption. Journal of Business Research, 69(4), pp.1277-1282.
irjevskis, A., 2019. The role of dynamic capabilities as drivers of business model innovation in mergers and acquisitions of technology-advanced firms. Journal of Open Innovation: Technology, Market, and Complexity, 5(1), pp. 1-16.
De Marchi, V., Di Maria, E. and Gereffi, G. Eds. (2017) Local clusters in global value chains: Linking actors and territories through manufacturing and innovation. Routledge.
Goyal, L. (2017) Leading digital strategy: Driving business growth through effective E-commerce. Vikalpa, 42(2), pp. 128-130.
Haggège, M., Gauthier, C. and Rüling, C.C. (2017) Business model performance: five key drivers. Journal of Business Strategy, 38(2), pp. 6-15.
Hänninen, M., Smedlund, A. and Mitronen, L. (2018) Digitalization in retailing: Multi-sided platforms as drivers of industry transformation. Baltic Journal of Management.
Jackson, C. and Orebaugh, A. (2018) A study of security and privacy issues associated with the Amazon Echo. International Journal of Internet of Things and Cyber-Assurance, 1(1), pp. 91-100.
Keswan, B., Mishra, T.C., Mohapatra, A.G. and Keswani, P. (2019) IoT security and privacy preservation. Security Designs for the Cloud, Iot, and Social Networking, pp. 97-111.
The Future of Jobs (2016) Drivers of change. Web.
Tu, Y. and Shangguan, J.Z. (2018) Cross-border e-commerce: A new driver of global trade. In Emerging Issues in Global Marketing (pp. 93-117). Springer, Cham.
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