To the occasional visitor to the USA, it might seem as if Amazon has taken over America. The retailer is siphoning off spent on Whole Foods, as well as generating income from AmazonGo/ book stores/4star. An Alexa powered Echo can be found in the hotel/hire car, as can PrimeVideo, prime labelled vans are everywhere and so on. And all of this a visitor would notice without having had any interaction with the main legacy website. To put it in other words: between Amazon retail (1P and 3P), devices and Prime Video, hardly a day goes by when fewer than 100 million people touch Amazon.
Its recent standout innovation AmazonGo is truly revolutionary, while other retailers have introduced their own checkout-free scan-and-go services, Amazon Go's “Just Walk Out Shopping” technology has taken that convenience experience up several notches.
For the Go stores, Amazon can claim that it has solved stealing, maybe someone could hack the bar code on entry - but for the moment shoplifting has been abolished. The concept uses Amazon's amazing computer abilities (using AmazonPay and AWS of course, also the computer vision also used in its facial recognition software) to scale, just as the retailer created synergies between prime, marketplace, and FBA.
In the future, Amazon could grow the concept and license the cashier-less technology to other convenience retailers. (The publisher is really curious what Amazon's preconditions would be for this - such as prime membership for a rival retailer's shoppers to use the service).
Moving from Amazon's front end stores to logistics, one can claim that Amazon is now a better logistics operator than Walmart, as it has grown its footprint of fulfilment centres, sort centres and so on - and indeed the entire Amazon Logistics business. The comparison between the two is especially enlightening when looking at delivery speed. Walmart's two million items (for two-day shipping) is no match for Amazon's one hundred million (prime eligible). And now Amazon is moving towards one - day prime deliveries as standard, as always keeping several steps ahead of the competition.
Amazon has also been highly innovative with its new warehouse and sort centre robots Xanthus and Pegasus (In September 2017 Amazon had > 100k robots in their warehouses, now there are 200k) - and in future the use of drones, self-driving cars and delivery robots on the other end of last-mile fulfilment.
In terms of the market place, there have been major changes also. In future it looks like Amazon will de-emphasize its 1 Party business and let 3P take over (apart from selected categories that are important for overall branding and shopper experience), as the marketplace generates much better margins, service sales outpace product sales, and 3P relationships can often be self-service.
The report is brought to you by Europe’s premier experts on Amazon, featuring anonymised quotes of current and former Amazonians. The publisher's sources for the study include unprecedented access to the company, a proprietary Amazon customer panel, their Amazon Best seller tracker tool, expert opinion and consumer surveys.
Table of Contents
1. Executive summary
- Data and KPIs: Net Sales & Income, Margin 2008-18, adding $55.0bn in 2018
- Data and KPIs: Net Sales & Income, Margin 2008-15, Analysis
- Data and KPIs: US, international, AWS sales, in $m, % split, growth, 2013-2018
- Data and KPIs: US, international, AWS sales, Analysis
- Data and KPIs: International sales by country, in $m, % split, growth, 2008-2018
- Data and KPIs: Active customer accounts in m, by country 2009-18, growth
- Data and KPIs: Active customer accounts, Analysis
- Data and KPIs: Average annual spend per country 2011-18 in local currency
- Data and KPIs: Average annual spend 2011 - 18e on AMZN 1P, Analysis
- Shopper research: loyalty, search, prime, brands presence, voice
- Shopper research: unique visitors, frequency, Amazon winning in clothing
- Shoppers: How Amazon reaches untapped potential - discounted prime
- Shoppers: How Amazon reaches untapped potential - Amazon PayCode
- Shoppers: How Amazon reaches untapped potential - Amazon Cash
- Shoppers: How Amazon reaches untapped potential - language options
- Data: Net sales by geography, average price, total units, customers, frequency 2018
- Data: Average price, total units, customers, frequency per country, Analysis
- Data: 3P share of GMV in % 1999-2018
- Data: 1P sales in US$m, 3P sales, % splits, GMV 2014-2018
- Marketplace: 14 global stores, appstore, 3P as the largest online retailer in the US
- Marketplace: More than 3.5k sellers join every day, seller structure
- Marketplace: The World’s Top Amazon Marketplace Sellers 2018, Momox
- Marketplace: Chinese sellers are taking over
- Marketplace: Amazon wants more exclusive brands from manufacturers
- Marketplace: Will Amazon shift its suppliers from 1P to 3P? And if so, when?
- Marketplace: First trial balloon of tactic in March, blamed on tech glitch
- Marketplace: The strength of the Amazon marketplace, vendor/seller decision
- Data and KPIs: The Prime Universe
- Data and KPIs: Prime account holders in m per country 2009-18
- Prime: The all-you-can-eat, physical-digital hybrid
- Prime: Prime: more successful at getting customers to cross shop than any other initiative
- Prime: Most successful tool to get buy-in to new categories, net costs, uplifts
- Prime: The 7 key prime benefits to Amazon
- Prime: Prime fee income 2015 in US$m, USA, Germany, Japan, UK, France, other
- Prime: Prime fee income 2016/17 in US$m, USA, Germany, Japan, UK, France, other
- Prime: Prime fee income 2018 in US$m, USA, Germany, Japan, UK, France, other
- Prime: Reconciliation Prime fee income 2015-18 with reported AMZN stats
- Prime: The move to one day shipping, costs of USD800 million in Q2
- Prime: Huge strain on Amazon logistics partners to move to one-day delivery
- Amazon Go: Store Visit - pictures
- Amazon Go: Amazon’s Most Ambitious Research Project
- Amazon Go: A footfall problem in Chicago?
- Amazon Go: From computer vision to sensor fusion
- Amazon Go: All physical Amazon stores at an early stage still
- Amazon Go: Immense costs for a magical shopper experience
- Amazon Go: Will it become a $4bn business?
- Amazon Go: The economics of a Go store, basket size, frequency, sales density
- Amazon Go: The cost of the hardware, range limitations, packaging
- Amazon stores: Amazon Books store visit - pictures
- Amazon stores: PrimeNow picking station at WFM - pictures
- Amazon stores: Brick-and-mortar strategy, all Whole Foods growth from delivery
- Amazon stores: Changes at Whole Foods, prime discounts a success
- Amazon stores: WFM saw as an offer to most fluent prime shoppers
- Amazon stores: Designing a new grocery format distinct from WFM
- Amazon stores: “Grocery Shopping for Everyone”
- Amazon stores: “Presented by Amazon” as a replacement for abandoned pop-ups?
- Alexa: A rival to Apple’s AirPods, Amazon’s first Alexa Wearable
- Alexa: A strategic nightmare working through Apple and Google’s OS
- Alexa: The potential of voice payments
- Alexa: Security concerns remain a substantial barrier
- Pill Pack: Acquisition to crack the $500 billion prescription market
- Pill Pack: Amazon attacking another established equilibrium
- Pill Pack: A great prime benefit?
- Pill Pack: Competing with the PBMs’ established mail-order services
- Pill Pack: Part of wider Amazon plan in health care, Haven and Alexa
- Pill Pack: Learning to function like an Amazon business
- Amazon Business: An overview
- Amazon Business: Data, market shares, customer profiles
- Amazon Business: The next USD10bn breakout success
- Amazon Business: As a strategic partner in B2B
- Amazon Business: Growth trajectory and forecast
- Outlook: Amazon 2020 forecast, 3P, 1P, GMV
- Outlook: Amazon 2020 building out the competitive moat
Chart 2: The Prime Universe
Chart 3: Amazon Business: an overview
Chart 4: Amazon Business: data, market shares, customer profiles
Chart 5: Amazon Business: as a strategic partner in B2B
Chart 6: Amazon Business: growth trajectory and forecast
Table 2: Data and KPIs: US, international, AWS sales, in $m, % split, growth, 2013-2018
Table 3: Data and KPIs: International sales by country, in $m, % split, growth, 2008-2018 (I)
Table 4: Data and KPIs: International sales by country, in $m, % split, growth, 2008-2018 (II)
Table 5: Data and KPIs: International sales by country, in $m, % split, growth, 2008-2018 (III)
Table 6: Data and KPIs: Active customer accounts in m, by country 2009-18, growth
Table 7: Data and KPIs: Average annual spend per country 2011-18 in local currency
Table 8: Data: net sales by geography, average price, total units, customers, frequency 2018
Table 9: Data: 1P sales in US$m, 3P sales, % splits, GMV 2014-2018
Table 10: Marketplace: The World’s Top Amazon Marketplace Sellers 2018, Momox
Table 11: Data and KPIs: Prime account holders in m per country 2009-18
Table 12: Prime fee income 2015 in US$m, USA, Germany, Japan, UK, France, other
Table 13: Prime fee income 2016 in US$m, USA, Germany, Japan, UK, France, other
Table 14: Prime fee income 2017 in US$m, USA, Germany, Japan, UK, France, other
Table 15: Prime fee income 2018 in US$m, USA, Germany, Japan, UK, France, other
Table 16: Reconciliation Prime fee income 2015-18 with reported AMZN stats
- Amazon (Prime, AmazonGo, Amazon stores, Alexa and Pill Pack)
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