Because of its reach and established brand in consumer minds, Amazon is a great channel for American sellers. Today, let’s take a look at the impact that Amazon has on these sellers during holiday seasons. This is by no means an easy task because Amazon offers data on a piecemeal basis and there is no standard definition of a holiday season. The lack of consistent reporting, the changing macro environments, seasonality and the different length of holiday seasons make it almost impossible to have a definitive view on how much American 3rd-party sellers grow their businesses on Amazon year over year. Nonetheless, below is my best estimate. Let’s go!
In 12 months between September 2020 and 2021, American 3rd-party sellers averaged 7,500 products sold per minute on Amazon and there are more than 500,000 of such sellers on the platform. A few days ago, Amazon reported that these sellers sold 11,500 products per minute between Black Friday and Christmas. That’s an increase of more than 50% compared to the non-holiday period. This sort of growth is what makes Amazon an irresistible channel for sellers, especially small ones.
At the end of 2020, Amazon reported that there were nearly 1 billion products sold by U.S-based sellers on its platform during the 2020 holiday season. That year, Amazon started the holiday season early in October right after Prime Day. How did 2021 fare compared to 2020? Let’s do some maths.
As sellers averaged 11,500 products per minute during the 30 day period from 11/26/2021 through 12/25/2021, it means that there were in total 496,800 products sold. From 10/4/2020 through 11/30/2020, which was Cyber Monday that year, U.S-based sellers averaged 9,500 products sold per minute, an equivalent of 793,400,000 items in total. Like 2020, the 2021 holiday season was also kicked off in early October. Assuming that the sales figures from 10/4/2021 through 11/30/2021 were about the same as the same period the year prior, U.S 3rd-party sellers would sell approximately almost 1.3 billion items in total for the whole season. Compared to the 1 billion figure in 2020, that means American sellers sold 30% more items on Amazon in 2021 than the year prior. A tremendous achievement at that scale.
In short, Amazon is still a great channel for American sellers, evidenced by a massive number of products sold during the holiday seasons and the estimated growth even at scale. Some critics often say that Amazon is no longer operating with the Day 1 mindset. It is debatable and in some aspects, they may have a point. But in this regard, I don’t see a slowed-down Amazon. I see an Amazon that is still growing impressively.
Disclaimer: I own Amazon stocks in my portfolio.