(Image source: Figureworm Creative)
The Seller Genie Content Team has carefully prepared this Amazon 2021 annual data report, covering Amazon's global market overview, the development and changes of the Amazon platform, Amazon seller and category data, etc., leading everyone to review 2021 and rush 2022.
First, Amazon's global market overview
1. Amazon global market
In 2021, Amazon has launched a Polish station (March 2) and an Egyptian station (September 1), and the number of Amazon sites has reached 20, including the United States, Japan, Germany, the United Kingdom, India, Italy, France, Canada, Spain, Brazil, Mexico, Australia, Turkey, the Netherlands, the United Arab Emirates, Saudi Arabia, Sweden, Poland, Egypt, and Singapore. Among them, 17 sites are open for registration for Chinese sellers.
(Source: SimilarWeb)
As you can see from the chart, the U.S. site remains Amazon's most important market, accounting for nearly 47% of its total visits to 20 markets worldwide. Japan, Germany and the UK account for the same amount of traffic, each accounting for about 10%. The United States, Japan, Germany, the United Kingdom and India account for nearly 80% of total traffic. Other sites have contributed little to the overall GMV growth. The traffic of each site will not change much in the two years from 2020 to 2021, and the traffic is still considerable.
(Source: Marketplace Pulse)
Although Amazon has the largest number of sellers in the United States, each active seller still receives the highest amount of traffic of any site. The average traffic for UK and Canadian sellers is only one-half and a quarter of that of US sellers. From this data, it can be concluded that Amazon's US market is not saturated.
(Source: Amazon Quarterly Earnings and Marketplace Pulse)
Total sales in Amazon's global market have continued to grow for 5 consecutive years, reaching $127.79 billion in 2021, an increase of more than $60 billion, an increase of 22% compared to 2020. This shows that the size of the Amazon marketplace is still expanding. Among them, the sales of North American stations, mainly in the United States, will reach $279.84 billion in 2021, which is still more than twice the sales of international stations.
(Source: Amazon Quarterly Earnings Report)
Amazon's quarterly global net revenue comes from online stores, offline stores, third-party seller services, subscription services, AWS and other (advertising, etc.) revenue. Net income as of Q3 in 2021 reached $332.4 billion, and net income for the full year 2021 is expected to exceed $400 billion.
2. Amazon-operated and third-party sellers
The total transaction value, including Amazon's proprietary and third-party sellers, exceeded $600 billion in 2021, maintaining growth for three consecutive years. Among them, the growth rate of third-party sellers is higher than that of Amazon's own operations. Amazon's third-party sellers' GMV reached $390 billion in 2021, a net increase of nearly $90 billion.
Through the graph, it can be more intuitively seen that the GMV of Amazon's third-party sellers will account for up to 64% of Amazon's total GMV in 2021. Ten years ago, in 2011, the percentage was 38 percent. This shows that Amazon's self-operated products have not encroached on the market share of third-party sellers.
Amazon's private label covers a wide range of categories, with clothing accounting for the largest share (47.7%), of which more than 70% of clothing products belong to the women's clothing category.
AmazonBasics' homewares and electronics are one of the more successful amazon private labels, accounting for 57% of all Amazon private label sales. Amazon is also constantly optimizing search traffic. Of the top 1,000 search terms on Amazon, 5.4 percent of hits went into Amazon Basics products.
Second, the development and change of Amazon
Let's take a look at what has changed at Amazon this year.
1. FBA under the epidemic
The price of imports from Asia has become higher and the speed of arrival has become slower. At the end of 2021, the sea freight rate for shipping goods from China to the United States increased fivefold from the beginning of the year and 10 times higher than before the epidemic. The highest rise in September 2021 was more than $20,000, and while sea freight rates began to fall by the end of 2021, they only fell to $15,000.
Affected by factors such as continued congestion on port cargo vessels, it takes almost twice as long for goods to arrive at U.S. warehouses in early 2020 (from 40 days to nearly 80 days). The rise in freight rates and the slowdown in deliveries mean that sellers have to reconsider freight routes, freight methods, pick-up locations, and production locations. The retail model of low warehousing quantities formed by the industry over the years and relying on frequent imports to match changes in market demand has had to be adjusted.
Despite the unstable supply chain environment and the implementation of policies such as warehouse limits in 2020, the inventory level of Amazon's warehouses is still high. In 2021, 83% of Amazon's top sellers owned the majority of their inventory using Amazon FBA, down just 1% from 2020. Although sellers are unable to deliver orders on time due to rising freight rates and limited storage space, there are always sellers who can fill this vacancy.
In addition to logistics, sellers are also facing the problem of rising promotion costs and pseudo-brands.
2. Amazon Advertising
By the end of 2021, amazon CPC advertising prices reached $1.33, up 43% from $0.93 at the beginning of the year. In early May 2020, the epidemic caused supply chain disruptions and brand out-of-stocks, causing the Amazon CPC advertising price to drop to a minimum of $0.70 in the month, and began to recover by mid-September 2020, ushering in three obvious peaks. Prime Day in October 2020, Black Friday and Online Shopping Monday in November, and Holiday Shopping Season in December. Since then, Amazon CPC prices have stabilized around $0.90 for most of the first quarter of 2021, reaching new peaks during Prime Membership Day in June 2021 and holiday shopping season in December 2021.
(Data source: Seller Genie Keyword Selection)
As can be seen from the figure, it is basically the same as the trend change of the CPU advertising price of the US station.
In the past two years, Amazon has continuously introduced new advertising types, and product pages have almost all been occupied by advertisements, and advertising has gradually replaced product recommendations and personalization on Amazon. From the above chart, it can be clearly seen that comparing Amazon's net income (profit) with advertising revenue, the profit growth generated by its advertising business is almost in line with Amazon's profit margin growth curve. This means that Amazon's profit income mainly comes from advertising revenue.
3. Brand flow on Amazon
In many categories, Amazon's best-seller list has been changing. For example, in the Headphone category, 666 brands of products have entered the top 100 best-seller lists in the past two years, and more than half of the brands have only been on the list for 5 days or less. But only 5 brands — Apple, Samsung, Sony, Soundcore and Tozo — have consistently made their headphones best-seller lists for the past two years.
But that doesn't mean new trends are replacing old ones. On the contrary, the brands that flow on BSR are often unrecognizable and difficult to remember brands, which are just "new brands" created by sellers in order to unlock Amazon brand services and get platform help.
The rate of loss of brands and the entry of new brands in the list does not seem to have slowed down, with big brands retaining their positions, but new brands entering the BSR list every day. This means that forming a moat for your own brand on Amazon is really difficult, but it is not impossible.
Since Amazon launched its one-click review feature in October 2019, the number of reviews of popular products on Amazon has increased significantly. For example, the average number of product ratings in the Headphone best-seller list increased from 4,500 in 2019 to more than 40,000 in 2021, and the average rating also rose from 4.1 to 4.4 points. This means that new product entry must do more to compete with products that are already wildly popular.
There is also a phenomenon that needs attention, although social media e-commerce is still in its infancy in the US market, it has indirectly promoted e-commerce sales.
4. Social media e-commerce
(Source: Seller Genie)
When consumers see something they like on Netflix or social media platforms like Instagram or TikTok, they will first open Amazon to try to search and buy. And that traffic doesn't even require Amazon to pay extra for advertising or commissioning.
In October 2021, the most searched word on Amazon was "squid game costume." At that time, the Netflix thriller squid game exploded, and it was only two weeks after it was online, which triggered a boom in the same costume. However, there were no official merchandise at the time, and Amazon sellers responded very quickly to changes in market trends, making Amazon account for most of the sales of squid game merchandise.
There is also a high-waisted gym pants that sold out on Amazon, which has long dominated the first place in Amazon's clothing list in the first half of 2021. The trend began in November 2020, when Lauren Wolfe released her first video. Subsequently, the keyword tiktok leggings suddenly soared to the top 100 search rankings on Amazon, and the popularity has remained so far. By the end of 2021, the video had more than 2.6 million views on TikTok, #tiktokleggings标签的浏览量为7.45 billion times.
3. Amazon seller and category data
1. Amazon product and seller classification
Despite the constant influx of new sellers to Amazon, more than half of the GMV generated by third-party sellers is contributed by sellers who joined in 2017 and earlier.
The entry speed of new sellers, on the basis of compensating for the loss of old sellers (suspended, suspended sales or others), also increases the number of Amazon third-party sellers to a certain extent. The ever-increasing overall GMV gives new sellers room to grow without impacting sales from existing sellers. As a result, the Amazon marketplace is not yet saturated.
The majority (56 percent) of Amazon's top sellers were those who had been on Amazon in 2016 or earlier, and only 8 percent had joined in the past two years. This data also supports the long-term, sustainable development that sellers and brands can rely on Amazon.
This is the life cycle of the head active seller on Amazon. Of Amazon's top 10,000 sellers, 60-65% continue to be at the top of the list after one year, 50-55% continue to be at the top after two years, and 40-45% remain active sellers in the third year.
Only 12% of top sellers in 2021 have more than 1,000 products available for sale. In 2015, the proportion was 40%.
For years, most sellers on Amazon were large distributors with tens of thousands of products. However, with increased competition and erosion of brand direct sales, the market has changed, with private label sellers taking the place of large distributors.
This is the product rating of Amazon's US site, that is, the number of products on sale under the major first-level categories. These categories are arranged in descending order according to the number of goods on sale, and the supply and demand relationship reflected in the number of goods on sale and the search volume of the core keywords of the category is an important reference data when selecting products.
It can be seen that as of January 7, 2022, the number of goods on amazon's US site has exceeded 580 million, of which the category with the largest number of goods on sale is clothing, shoes and jewelry.
2. Amazon China sellers
From April to May 2021, Amazon's banning wave hit, and hundreds of Chinese sellers were suddenly banned for manipulating reviews. However, the wave of suspensions did not have a significant impact on the platform, and the sellers who were suspended from sales accounted for only a small number of Amazon's Chinese enterprises, but they still caused shock in the industry.
It is precisely because of the wave of suspensions that the market share of Chinese sellers in the top sellers has declined for the first time, and by the end of 2021, only 36% of the top sellers on Amazon are from China. Previously, the market share of Chinese sellers in the top sellers has been rising year by year, 22% in 2017, 26% in 2018, 33% in 2019, and 42% in 2020.
Next, take a look at the performance of Chinese sellers on various sites.
(Source: Marketplace Pulse)
As of December 2021, 45.2% of amazon's global market sellers are from China, down from 47.9% in 2020. Among the Top10,000 sellers on Amazon's various sites, Chinese sellers account for more than 30%, of which 41% are Chinese sellers in the TOP10,000 on the US site.
Amazon's sales in its global marketplace come from local sellers and Chinese sellers, with a small share in other countries, with local sellers in France, Italy, Spain, Mexico, and Canada contributing less than half of sales.
This is the number of user query sites in the seller's spivet keyword anti-check, and the number of user site queries in the second half of 2021 (6 months) and the number of user site queries in the second week of December 2021 were randomly sampled, and the results obtained were basically the same. Amazon China sellers follow the following sites: the United States, the United Kingdom, Germany, Japan, France, Italy, Spain, canada.
This is the category of the top100ASIN of the number of user queries on the US site in the seller's spout keyword anti-check. It can be concluded that the top ten categories that Chinese sellers pay attention to in the United States are home kitchen supplies, home improvement, toys and games, electronics, sports and outdoor goods, courtyard lawn and gardening, beauty and personal care, auto supplies, pet supplies, clothing, shoes and jewelry.