Amazon is the world’s largest digital marketplace and it’s not even close. Despite the proliferation of ecommerce websites in recent years, Amazon only continues to grow and cut out a larger share of the market.
The bad news: Your ecommerce business will probably never outgrow Amazon.
The good news: Amazon makes it very easy for businesses to sell on Amazon and utilize the ecommerce giant’s massive reach.
While growing an ecommerce business is challenging, using Amazon to your advantage makes it a little easier. You can sell practically anything on Amazon using their self-service tools to build your product pages, market your products, and supplement any existing ecommerce initiatives. You can even leverage Fulfillment by Amazon (FBA) to let Amazon handle order fulfillment and customer service for your business.
Amazon offers a lot of potential to online retailers if you know what you’re doing. Whether you’re starting a full-time ecommerce business or just looking for a way to earn some passive income or supplement an existing business, these Amazon statistics will help you understand what it takes to succeed as an Amazon seller in 2020.
To put that number into context, that’s nearly two-thirds of the population of the United States and about half of the number of pigeons living in the world today.
The first quarter of 2020 was Amazon’s best on record, continuing a decade-long trend of enormous growth.
The most recent research available finds that Amazon represents 49% of all online retail sales in the United States. The platform also represents 5% of all retail sales in the country.
Amazon isn’t just powered by its website, it also has the United States’ most popular shopping app by a wide margin. Walmart ranks second with “just” 76.45 million users—about half as many as Amazon.
Millennials are by far the most active generation on Amazon. They spend twice as much time on Amazon as Baby Boomers and spend twice as much money.
Before making a purchase online, as many as 90% of consumers will check Amazon to see if it’s cheaper. In this way, Amazon practically sets the market for any product.
Not only do consumers price check products on Amazon, but they almost always prefer buying from Amazon. Amazon is a known entity, which gives it a leg up on less ubiquitous ecommerce brands. That’s why it’s so important for third-party sellers to utilize Amazon.
According to an Adeptmind survey, 46.7% of users start their consumer journey on Amazon, compared to 34.6% who start on Google. When people’s intent is to shop, they’re very likely going to Amazon first.
Not only do consumers think of Amazon first when they start shopping online, but even when they’re not sure what they’re looking for, nearly a quarter of shoppers will go to Amazon first.
Unsurprisingly, 82% of Amazon shoppers say price is the most important factor when deciding to buy. From there, 70% say shipping costs, 57% say positive product reviews, and 49% say flexible return policies are their most important driving factor when making a purchase.
Though it was founded as an online book retailer, Amazon has gotten a lot techier. Electronics are now the most popular category on the platform.
Amazon and CEO Jeff Bezos have gotten a lot of bad press over the years, between its negative impact on the environment, its treatment of employees, and controversial business practices. Still, only a quarter of Americans see the company in a negative light.
Nearly half of all Americans have an Amazon Prime subscription, giving them access to free two-day shipping on a wide variety of products as well as Amazon’s streaming media service. That number represents a 50% increase from April 2018.
Prime members pay for the privilege of being Amazon’s best customers. Non-prime members spend only $600 per year on average.
Prime Day has revolutionized ecommerce, becoming a bonafide shopping holiday. These days, if you’re an ecommerce business that’s not running a Prime Day sale, you’re missing out. Those global sales numbers were up 71% from 2018.
Third-party sellers drove a little less than one-third of all Prime Day sales in 2019, which should tell you just how much power Amazon has when it leads the way by discounting its own products.
That may sound like a lot, but Amazon actually has 8.8 million total sellers, with only a quarter of them are actively selling products every month. So far in 2020, 748,000 new sellers have joined the platform.
Amazon has its own branded products and partnerships, but just over half of all sales on the platform are driven by its third-party sellers.
In dollar terms, third-party sellers drove nearly $54 billion in sales in 2019, which was a 20% increase from the $42.75 billion in sales in 2018.
This is a truly astonishing statistic. Amazon has become so ubiquitous and essential to the American economy that nearly half of businesses are fully dependent on the platform. This number doesn’t refer to ecommerce businesses, it’s all U.S. businesses.
Amazon has completely revolutionized not just online shopping but the world of retail in general. People go to Amazon for practically everything these days, from books and electronics to household supplies and groceries. If you’re selling online, you need to be on Amazon, and hopefully these statistics will help you get the most out of the platform.
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Nick Perry is a freelance writer based out of Boston. After working in Hollywood and Silicon Beach, he launched his own small business and frequently referenced Fundera’s resources. Now, he’s a contributing writer at Fundera. Nick has written extensively about small businesses, ecommerce, the restaurant industry, and entertainment. His work has appeared on Entrepreneur, Digital Trends, Toast’s On The Line, and more.