Amazon Q4 Preview

January 28, 2013

ChannelAdvisor ChannelAdvisor By ChannelAdvisor

Amazon reports their Q4 2012 results after the bell on January 29th 2013 (Tuesday).  eBay and Google had a very strong showing, so now all eyes are on Amazon to see if they lost share from those two Titans, or all Titans took share from the rest of e-commerce.

The following table details the usual key metrics we track in Amazon’s results for sellers/retailers that we think most illustrate how not only Amazon is doing, but most importantly for reader’s of this blog, the health of the third-party (3P) marketplace.

Amzn_q4_preview_dashboard

 

1P vs. 3P for Q4

One area I have been writing about a lot lately is an analysis that Amazon’s 3P business is getting large, in fact so far for 2012, I believe it is trending larger than 1P on a GMV apples-to-apples basis.  For a refresher, here’s a chart from a past blog post:

 

Amzn_q4_preview_chart3

If Q4 comes even close to where I projected, then we’ll have the first year that 3P > 1P on a GMV basis.

Jordan Rohan, Internet Analyst @Stifel had a Q4 Amazon preview report that had a couple of interesting datapoints along these lines based on his analysis and thoughts.  First he had this chart that shows his analysis and projections going forward for GMV from 1P and 3P:

Amzn_q4_preview_chart1

As you can see, he also has a similar view that for the first time, in 2012 3P GMV should be slightly larger than 1P.  then going forward, yo usee that by 2014, 3P is quite a bit larger in his model.

 

The second datapoint I thought was interesting was a look at the growth rate of 1P and 3P:
Amzn_q4_preview_chart2

 

What else to look for?

 

 

Additionally, we will be keen to hear anything about:

  • Distribution centre build out – at most of the last several calls, Amazon’s body language has been they are going to continue rapid and aggressive DC build out
  • 3PM growth – The 3PM has been chugging along at > 60%, we’ll be watching that closely.
  • Any Prime/Fire updates – Prime is the nitros-oxide of Amazon and we’re always keen to see if there are any interesting new tidbits that Amazon shares.

 

As usual, we’ll be posting our analysis of the results shortly after they are posted.

 

Scot Wingo, CEO of ChannelAdvisor wrote this post.  I am long Google and Amazon.  eBay is an investor in ChannelAdvisor.