Amazon CRM Case Study

Amazon. No, we’re not talking about the South American rainforest. But when it comes to sheer size, we might as well be. Amazon is an ecommerce goliath – a household name where you can buy almost anything you might want or need, and have it delivered the next day. So what’s been the secret behind its massive success?

Amazon’s world class Customer Relationship Management (CRM) strategy, of course.

Amazon is growing every year. In Q4 2022 alone, it reported a colossal $149.204 billion in revenue – a 9% increase from the same period in 2021. According to Bloomberg, Amazon’s founder Jeff Bezos’ net worth is currently $143 billion and he’s well on track to become a trillionaire by 2026  – although the company itself surpassed that particular milestone when it reached a market value of $1.32 trillion in June 2020. So just how did Amazon’s CRM take it from its humble roots as a garage-based online bookseller to unfettered digital dominance?

Developing its CRM strategy has helped Amazon retain customers, and tailor its service around the individual. And crucially, it’s helped it sell to its millions of loyal customers not once, but again and again, while fighting off swarms of competitors. Amazon’s success is a prime CRM strategy example to follow.

The Amazon story

1994: Jeff Bezos founds company as an online bookseller

1997: Reaches one million customer accounts

1998: Expands into selling CDs and DVDs

2001: Makes first profit in final quarter of year

2005: Launches Amazon Prime

2007: Launches the Kindle e-reader

2017: Acquires supermarket chain Whole Foods Market

2020: In February, Amazon becomes just the fourth tech company in the world to reach a valuation of $1 trillion

2021: Purchases 11 aircraft from Delta Air Lines and WestJet Airlines to join ‘Amazon Air’ – the ecommerce titan’s burgeoning entry into the cargo network space.

2022: Receives awards in the Best Product and Design Team and Best Places to Work in Seattle categories at the Comparably Awards.

2023: Ends its charity donation program in February as a cost-cutting measure.

Amazon’s CRM strategy: the secret to success

A strong emphasis on the customer is the foundation of Amazon’s success – and it’s the company’s intelligent use of CRM that has enabled this. But it doesn’t use your typical CRM software such as Zoho or HubSpot. Developed in-house, Amazon’s CRM software captures customer data at the point of purchase, which it uses to instantly customise its users’ online experience and get a full view of the customer journey. It learns about customer habits, improves relationships from the first purchase, and reduces returns or even cart abandonment based on the customer’s ecommerce activities.

A conventional CRM will be able to get the job done well for the vast majority of businesses,  but Amazon has the resources to create and maintain its own CRM, which has specific features designed to work seamlessly with the Amazon platform. With its custom-built CRM, Amazon can be 101% sure that operations will run smoothly, workflow can be improved from top to bottom, and customers will be taken care of.

So why do customers keep coming back? Well, Amazon’s interface is simple and easy to use. You can view your own order history and how much you’ve been spending, and returns are handled swiftly through the system. Re-ordering is a breeze, and you can track your purchase through every stage of the delivery process.

All of this is down to how Amazon has managed to overcome common CRM problems, as well as the ecommerce giant’s intuitive use of CRM software. Let’s take a look at how it works.

Are you interesting in using CRM software? Check out our guide to the best CRM systems for small businesses.

The top 5 ways Amazon uses CRM

1. Tailored offers and promotions

When someone buys something on Amazon for the first time, Amazon asks them to set up an account. Why? Because it makes for a smoother and more personalised experience, as they’ll get recommendations based on their interests.

This allows Amazon to tap back into what its customers like and sell to them on an ongoing basis. Amazon’s CRM brings customers tailored offers and promotions based on their past purchases – a popular approach to CRM that’s also well-utilised by the likes of Apple and Uber.

This is why a CRM system is an indispensable tool for carrying out your marketing strategy. It’s not just essential to customer service, but sales and marketing too. To execute the perfect marketing campaign, you must have a clear understanding of what your existing customers need, and a CRM software will be able to help you better analyse customer data so you can address those needs.

2. Personal data collection and storage

Amazon’s CRM stores its customers’ personal and payment details when they create an account to buy something. And no, it’s not for any sinister, shadowy purposes (we hope!) – it simply makes it that much easier for customers to purchase again. They can order with one click – knowing that their personal data is protected by Amazon Pay’s industry-leading fraud prevention tools – and have their item arrive the next day.

Just remember that businesses must comply with the General Data Protection Policy (GDPR), an EU regulation on data privacy standards. When customers are confident that the companies they do business with are protecting their personal information, trust automatically grows. This is an essential layer to add to the client relationship you’ve been cultivating.

With that in mind, it’s not hard to see why Amazon is crushing the competition.

3. Recommendations

Another great thing about Amazon’s CRM? The recommended products feature. When customers are logged in, Amazon will recommend products that might interest them based on their past purchases. Customers can also check out what other people viewing an item also bought, and explore related products with ease. Offering these temptations without pressuring the customer is what’s helping Amazon turn over billions every year.

Likewise, your customer’s purchase history, which is archived in your CRM system, can be used to provide exceptional customer service. Through this information, you can anticipate your customers’ needs based on what they’ve purchased or viewed, which will result in getting your salespeople to sell more.

4. Customer support

The big one. Amazon customers can deal with almost every issue they might have through their account. The returns process is all dealt with online too. And if there’s something that does require them to speak with a customer service assistant? CRM to the rescue again. Any Amazon staff they speak to will have their details at the ready, meaning quick and efficient resolutions to all problems – and more satisfied customers.

Using your CRM system, you can program ready-to-use email templates. If a customer complaint comes in and you respond immediately, this allows the customer to relax more, confident that their issue is already being handled. Besides, a quick response is a sign of professionalism and, without a CRM software, you won’t be able to pacify your customers.

5. Evolution of services

Amazon’s use of CRM has been influential in the growth of its services. Its dedication to its customers led to the invention of the Kindle, while Amazon’s online Kindle Marketplace offers a tailored experience with unique book suggestions.

Amazon Prime Video has also become one of the biggest streaming services out there. It offers hand-picked film and TV choices for each customer, which wouldn’t be possible without CRM.

CRM is at the forefront. CRM is at the backend. CRM provides you a 360-degree view of what your customers need. Whether it’s the addition of AI in the system or coming up with a better product to service and, of course, retain existing customers, CRM is a huge factor in helping you unlock business growth.

Next Steps: how to start using CRM

CRM might just be the most important tool in your customer communications arsenal, but you need to know which CRM software you should invest in. A good one can help you increase sales, manage your staff, create better marketing campaigns, analyse data, and nurture leads.

Discover how CRM is redefining the success of other major brands with our CRM case studies, or jump straight into choosing a CRM system for your business today:

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