In March 2018, Amazon reached the 10,000 seller mark. What’s even more amazing is that so far this year, 270,151 sellers joined all Amazon marketplaces. That’s two new sellers every minute! (or 122 new sellers every hour…or 2,936 every day!). Australia’s jump to 10,000 may seem small in comparison (7,288 new sellers since the start of the year), but this actually means Amazon.com.au is growing the fastest relative to the marketplace size.
It’s no coincidence that Amazon’s growth in Australia coincides with the much-anticipated Fulfilment by Amazon (FBA) launch. With FBA, Amazon picks, packs, ships and provides customer service (including returns) for FBA approved products. Essentially, it means that sellers have access to one of the most advanced fulfilment operations in the world to store and ship your products. It is believed that Prime (Amazon’s customer paid membership program) will launch around mid-2018. This is expected to lead to another boost in Amazon consumer penetration and seller uptake. It is estimated that Amazon Australia will exceed 50,000 sellers by the end of the year.
But what does that all mean? As we have seen in overseas markets, marketplace growth is a kind of cycle. There is a link between marketplace offerings, seller uptake and consumer attraction. This then leads to the reverse, with increased users resulting in a surge of sellers. Amazon’s supply is limitless, while consumer demand continues to feed seller demand and so-on.
On Amazon.com, 25 percent of sales are through just 1,000 sellers. When we add to this figure that 66 percent of the top 10,000 sellers on Amazon use FBA, the numbers are pretty clear.
We are in the early stages of Amazon, but we are starting to get a feel for where we’re heading. Sellers are becoming more comfortable with the marketplace and integration is becoming less daunting, especially with the right tools. With a long-term view, we can see the benefits of early adoption in relation to Buy Box placement and seller history as well as the benefits of FBA (and the future benefits of Prime). As consumer uptake continues, the retail landscape will shift and the marketplace-user-seller cycle will continue.
What to know more about what to expect? Contact us today with any questions you have about your Amazon strategy and how to leverage marketplaces.