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Amazon expanded its single-product business by leveraging spare capacity into cloud computing and by offering its kindle line of tablet computers and echo line of digital assistants. This is an example of related linked diversification.
What is related to linked diversification?
Related, linked diversification is described as a form of diversification strategy. In this strategy, a company will have one-to-one relationships with the various components. This means that the company earns 70 percent of its revenue from its dominant businesses, and the businesses have no common links.
Amazon has its biggest e-commerce business. However, it earns the majority of its revenue from cloud computing. This is a classic example of related linked diversification, in which the products have no common links between the different business types carried out by Amazon.
It can be concluded that Amazon expanded its single-product business by leveraging spare capacity into cloud computing and by offering its kindle line of tablet computers and echo line of digital assistants. This is an example of related linked diversification.
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