Amazon market entry effects on e-commerce markets and possible future impact on Finland’s e-commerce market

Abstract

This thesis has used theory and data to determine what kind of effects the U.S based online retailer Amazon has had in different countries where it has expanded into. By examining case studies from two different countries, the paper determines the possible effects to the e-commerce market in Finland in case of an Amazon market entry into the country.

The literature review part of the study examines in detail different e-commerce theories and explains their function and effect in markets. It will also study science behind market entry strategies and through theory it assesses the strategy Amazon is using for market entries. It also includes theory on Amazon’s operations and business model so that the reader can better comprehend the data in later parts of the study.

The thesis is based on case studies from two different countries and markets: Spain and Australia. It looks at data gathered from different sources to build an image of the state of that country’s e-commerce market before an Amazon market entry and compares that data to the state of the e-commerce market and Amazon market share in that country some years after the entry.

The results of this thesis show that market entries and effects on e-commerce are very different in two different geographical areas and timelines but it can be determined through the case studies that an Amazon market entry will eventually give the company a steady market share in the Finnish e-commerce market while yielding little to the overall e-commerce growth of the country.