The Atlantic’s Post

Amazon shipped over 7 billion items globally last year with same-day or next-day delivery options, offering a competitive edge for Amazon sellers over other platforms. Their focus on fast shipping in 2005 has helped them achieve their spot as the go-to online shopping destination for many consumers. But it's not just about fast shipping... It's about pairing speed with a wide selection of products. Here’s what you can learn from Amazon’s approach: ⚫ Speed is King: Prime orders are hitting doorsteps in record time in nearly 60% of the largest US metro areas. This isn't just about convenience; it's about meeting consumer expectations head-on. ⚫ Loyalty Boost: Faster shipping equals happier customers. And happy customers keep coming back for more. Amazon's focus on speed is translating into loyalty and increased purchase frequency. ⚫ Competition Crunch: Other online retailers are struggling to keep up. Amazon's vast selection coupled with lightning-fast delivery has set a benchmark that's tough for competitors to rival. Some retailers are dabbling in alternatives like store pickup or direct shipping from China, however, their selection isn’t as vast as Amazon's, not to mention they often have slower delivery times. Read more about fast delivery's impact on customers and markets: https://lnkd.in/gDXRY4yS #AmazonFBA #DeliveryStrategy #EcommerceInsights

Amazon shipped over 7 billion items globally last year with same-day or next-day delivery options, offering a competitive edge for Amazon sellers over other platforms. Their focus on fast shipping in 2005 has helped them achieve their spot as the go-to online shopping destination for many consumers. But it's not just about fast shipping... It's about pairing speed with a wide selection of products. Here’s what you can learn from Amazon’s approach: ⚫ Speed is King: Prime orders are hitting doorsteps in record time in nearly 60% of the largest US metro areas. This isn't just about convenience; it's about meeting consumer expectations head-on. ⚫ Loyalty Boost: Faster shipping equals happier customers. And happy customers keep coming back for more. Amazon's focus on speed is translating into loyalty and increased purchase frequency. ⚫ Competition Crunch: Other online retailers are struggling to keep up. Amazon's vast selection coupled with lightning-fast delivery has set a benchmark that's tough for competitors to rival. Some retailers are dabbling in alternatives like store pickup or direct shipping from China, however, their selection isn’t as vast as Amazon's, not to mention they often have slower delivery times. Read more about fast delivery's impact on customers and markets: https://lnkd.in/ee6jpbJ4 #AmazonFBA #DeliveryStrategy #EcommerceInsights

What's happening at Amazon? Here is some interesting news reported on Marketplace Pulse regarding Amazon's Multi-Channel Fulfillment (MCF). WTF is MCF? Well, for those of you who are not familiar with it: it is one piece of Amazon's attempt to create a retail infrastructure used by everyone. If you do not shop on Amazon directly, you may use its payment services such as Amazon Pay or Buy With Prime. When it comes to logistics, your parcel might get shipped by MCF. So it really is a brilliant idea to capture at least some part of any (online) retail dollar spent. “Amazon MCF has grown to serve over 200,000 U.S. sellers and has seen a 70% year-over-year increase in the total number of orders that have been fulfilled by MCF so far this year.” — Amazon during the Amazon Accelerate conference in Seattle Presumably, this growth for MCF comes from rising stars Tiktok, Shein and Temu. All of them have aggressively entered the US market. Amazon is cleverly leveraging its services to benefit from their success. Read the full article here, kudos to Juozas Kaziukėnas: https://lnkd.in/dQjsP2Yg What's your take on this? Will MCF become successful outside the US as well? Prof. Dr. Christian Stummeyer, Jonathan Reynolds, Oliver Lucas, Kai Hudetz and Ralph Hübner? #amazon #fba #amazonmcf #ecommerce

Amazon says more packages are arriving in a day or less after a hefty investment in speedy fulfillment Amazon says it is getting even more packages to customers in one day or sooner, a metric the e-retailer is promoting to customers as it faces heightened competition in online shopping. The company said on Monday that nearly 60% of orders placed through Prime in the top 60 U.S. metro areas in the first quarter arrived the same or next day. That is up from roughly 50% in the second quarter of 2023. It is a topic that will be of notable interest to investors when Amazon reports first-quarter earnings after the close of trading on Tuesday. Wall Street expects the company to post another quarter of double-digit revenue expansion and for profits to more than double from a year earlier. Cost-cutting efforts, cloud-computing demand and faster fulfilment have driven higher profits in recent quarters. Speedy delivery is a hallmark of Amazon’s Prime subscription offering, which charges members $139 a year for benefits such as two-day shipping and video streaming. The company has said it wants to make same- and next-day delivery the standard, and it plans to double the number of same-day delivery facilities in the U.S. within the next few years. “As we get items to customers this fast, customers choose Amazon to fulfil their shopping needs more frequently,” CEO Andy Jassy wrote in his letter to shareholders earlier this month. “And we can see the results in various areas including how fast our everyday essentials business is growing (over 20% y/y in Q4 2023).” According to RBC Capital Markets data, consumers have been shown to spend and shop more often if they have one-day shipping. Amazon’s physical footprint swelled between 2020 and 2022 as the pandemic-driven e-commerce boom pushed the company to rapidly add new warehouses and delivery centres to its logistics network. Amazon last year retooled that network into eight regions instead of a national model, which the company says has resulted in faster yet cheaper deliveries. Jassy in his shareholder letter noted that the cost to serve, or the cost to get a product to a shopper, was down in 2023 by more than 45 cents per unit year over year. Amazon has already set up more than 55 same-day delivery sites in the U.S., primarily clustered around major metro areas. The facilities are roughly 100,000 square feet, compared to a typical Amazon warehouse, which can be the size of 26 football fields, and they store a smaller selection of goods that are the top-selling items in each city. Same-day sites also condense the fulfilment process, typically spread across multiple Amazon facilities under one roof. A package makes fewer stops on its route to a shopper’s doorstep, which cuts down on costs per shipment. News credit CNBC #news #technews #dailynews #dailynewsupdates #trendingnews #trending #viralnews

#Shein, #Temu, #Aliexpress, and #TikTok Shop represent the third iteration of Chinese e-commerce “Marketed by China”, while the previous two stages were "Made in China" and "Sold by China". China's domestic market analysis defined the year 2023 as the "Year One of Chinese Four Dragons", and the world began to know Chinese #ecommerce. Although attracting shoppers with cheaper prices is the common strategy of the four players, they still have different focus. #Tiktok :Social commerce  #SHEIN: “Order in small quantity but with quick response" model is achieved by introducing a small number of new products in the first batch and, based on the speed and situation of sales, quickly adding orders. It is also a marketing powerhouse with a massive social networking presence rather than a plain catalog offering cheap goods. It has more followers on Instagram than Amazon, Walmart, and AliExpress combined. (surpprising fact to me) #Temu: Social Networking fission acquires new users. focusing on offering affordable goods to low-and-middle-income groups, where the other giant competitors may have less attention.  The common key trend for the four players in 2024 will be the #"All-In-Care" model which means merchants only need to provide goods, and the platform provides other services including store maintenance, warehousing, order processing, payment, logistics, and other operational services.

Why Amazon's Attempt at a Temu-Like Store Might Not Succeed In the ever-evolving landscape of e-commerce, Amazon is known for its relentless innovation and market dominance. However, I'm skeptical about their recent attempt to launch a Temu-like store. Here are four reasons why I believe this strategy might not work: 1. The Myth of Fully Managed Services Amazon's so-called "fully managed" model isn't truly comprehensive. Although the commission rates (10-15%) are aligned with Amazon’s main site, the pricing power still lies with the sellers. This means Amazon's white-label products won't have a significant price advantage over Temu, which might deter cost-conscious consumers. 2. Cannibalizing Their Own Market Launching a white-label store could inadvertently hurt Amazon's own brand partners. By competing directly with its existing marketplace sellers, Amazon risks reducing the overall GMV (Gross Merchandise Value) of its platform. This internal competition is counterproductive, making it unlikely that Amazon will allow its white-label segment to grow too large. 3. Customer and Seller Overlap The customer and seller base for Amazon's new venture heavily overlaps with its existing FBA (Fulfillment by Amazon) network. In contrast, Temu targets a different demographic—price-sensitive consumers. Furthermore, Temu's sellers, or rather suppliers, have already moved upstream in the supply chain, giving them a competitive edge with direct access to manufacturing. 4. Operational Challenges Running a "fully managed model" demands robust operational capabilities, including supply chain integration and meticulous store management. Unfortunately, these are not Amazon's strong suits. The high labor costs in the US make it difficult for Amazon to compete with Temu, which operates primarily with a Chinese-based workforce skilled in these areas. In conclusion, this move seems like a desperate attempt by Amazon, rather than a well-thought-out strategy. I believe it’s not a rational choice and is unlikely to succeed. What do you think about Amazon's new strategy? Let's discuss! Follow me on LinkedIn for updates. #ecommerce #amazon #retailstrategy #marketplace #supplychain #businessstrategy #onlinestore #temu #marketanalysis #innovation #businessinsights

A must read from Marketplace Pulse for anyone with a business that impacted by Amazon and other marketplaces! Here are some of the raw quotes and numbers that stood out to me: 🔬 - Amazon has so little meaningful competition that it doesn't feel forced to innovate. 🛒 - Amazon is 4% of Retail, 40% of eCommerce, and 80% of Marketplaces 🚐 - Amazon will deliver 5.9B packages more than FedEX and UPS 📦 - Fulfillment is not the cost center or unavoidable business unit -- it is what Amazon sells. 💰 - Amazon is pocketing more than 50% of seller's revenue, up from 40% five years ago. 📺 - Combined retail media revenues are already almost twice as large as radio and print combined and the gap with television is closing swiftly, set to surpass it in 2028. What does it mean for brands running a business trying to figure out their online strategy? Amazon isn't the only player, the Shein and Temu are having a huge impact on online advertising, how Walmart is competing, and the impact of retail media networks on the consumer experience.  Brands will need to figure out how to simultaneously take advantage of the customers on Amazon, while developing their own relationships with the consumer.  Danny Ascencio-Hall, Rob Riesterer, Sara Skarda, Eamon Kelly, Don Brett, Jamie Schwab, Aaron Swart, Kaitlyn (Kacie) McKee, Melissa Dunn

Amazon's controversial new fee targeting low-stock has been delayed again. Originally set for April 1, 2024, it's now pushed back to May 14, 2024. Despite backlash and concerns, Amazon stays committed, making strategic amendments to address seller grievances. The question remains: Will this new fee structure help maintain optimal inventory levels or push out smaller sellers? 🤔 As the FTC takes notice, the e-commerce landscape changes, and sellers consider alternatives; only time will tell. Click the link below to learn more about this controversial fee 👇 🔗 https://lnkd.in/g9rPYkpq - #amazon #ecommerce #inventorymanagement #fbafees #amazonfba #fba #ecommerceupdate #sellercommunity #amazonfees #inventoryfee 

As Amazon fees rise, sellers innovate with product changes, price increases, and exploring new marketplaces to stay profitable. For more details, read the full article here: https://lnkd.in/gMF2DDGm #ecommerce #Amazon #onlinemarketplace #businessgrowth #retailnews

Strongly agree with Juozas Kaziukėnas's statement that Amazon's same day and next delivery is widening its gap with competitors. To paraphrase Juozas, "Retailers sell goods, But Amazon doesn’t sell goods. It sells goods that ship in one to two days and, for some shoppers, same-day." I would add that Amazon sells goods that ship in one to two days AT THE LOWEST PRICE in the market. It's not just about assortment and speed, but price too -- it's the combo of all 3 things that makes Amazon so powerful. But at the same time, price dominance puts tremendous margin pressure on suppliers. As Martin Heubel has written many times, Amazon wants all of your assortment to ship same day, or next day -- but they don't want to share the cost hit, or allow brands to raise prices to make it economically viable for them. So the only thing that can blow up Amazon's beautiful flywheel is whether Amazon demands so much from brands and the cost of serving them becomes so high and so onerous that they decide to opt out. It's why hedging bets with Walmart is so critical and why many brands are rooting for last mile delivery companies like Door Dash, Uber Eats and Go Puff to gain more share. They should be in the upper left of this visual.