Amazon just turned in a fairly healthy second quarter earnings with Q2 Sales up 29% to $12.83 Billion. What more interesting is that 4 out of every 10 products sold on Amazon is now sold by a third party retailer rather than Amazon Retail. (Read Scot @ ChannelAdvisor for full analysis).
“Amazon Prime is now the best bargain in the history of shopping” according to Jeff Bezos, who points out that launched with 1 million items, Amazon now has 15 million items eligible for free expedited shipping along with 18,000 movies and TV episodes available for unlimited streaming and the Kindle Owners’ Lending Library of 170,000 books to borrow for free. The cost of Amazon Prime in the US is still $79 per year, the same as when it launched seven years ago.
That’s the type of program which is making Amazon a success, they have an obsession with delivery and whether retailers like it or not it would appear that consumers do. That’s also why Amazon just upped the returns criteria for third party sellers in the UK to 30 days – Amazon say that their customers love the service and Amazon’s sales growth suggests that they’re right.
For a full indepth dive into Amazon’s Q2 financial results check out ChannelAdvisor’s Amazon Strategies blog, as Scot tends to have the best analysis.
3 Responses
Given that 4 out of every 10 sales are by third party retailers it would be nice if Amazon treated us with a bit more respect. They have no respect for third party retailers at all.
I accept that different people have different experiences and hold different views on practically every subject under the sun. But as a 3rd part seller on Amazon I have to say that my experiences to date have been excellent. I always get a prompt understandable reply and have found that Amazon really do help 3rd party sellers. From a business perspective having 3rd party sellers expanding your product range, paying for that stock and in the case of FBA sellers paying storage fees is a brilliant move. I honestly believe that Amazon will be pushing for more and more 3rd party sellers and this time next year we will be reading that 5 out of every 10 or more simply put 1 in ever 2 products sold on Amazon is from a 3rd party seller. Compared to the nonsense that eBay consistently churn out selling on Amazon is quite refreshing. The return policy is a bit painful on occasion but once you accept this as part of your selling strategy it’s not too bad. Amazon isn’t perfect but they leave eBay looking like 2nd rate amateurs.
“I honestly believe that Amazon will be pushing for more and more 3rd party sellers ”
I had a call from them a few months back saying they saw we were selling on ebay and if I had considered selling on Amazon. (I already do, just with a different email address)