Amazon 2021: Dominating The All-Delivery Economy, Advertising and Streaming, the FBA Roll Up – | Financial Buzz

Amazon 2021: Dominating The All-Delivery Economy, Advertising and Streaming, the FBA Roll Up –

The “Amazon 2021: Dominating The All-Delivery Economy, Advertising and Streaming, the FBA Roll Up” report has been added to’s offering.

Due to the various lockdowns 2020 was arguably the first real online Christmas, which has meant a great final quarter for Amazon, closing out a real stand out year for the company. The research team believe that Amazon marketplace’s GMV has grown by at least 50% from US$200bn in 2019 to around US$300bn in 2020.

That said, some other retailers have also reported record figures and in many ways the logistical advantage (FBA, Prime Air, Fulfillment centre network) Amazon has built up over the competition over years has (almost unbelievably) been somewhat reduced, as competing retailers have invested heavily into their own digitalisation (Walmart, Kroger etc) and logistics efforts and/or services such as Instacart have proliferated and are easily available on a plug and play basis. One should mention the runaway success of Shopify in enabling independents and major retailers alike to go online in this context too.

While Amazon’s logistics network was simply overwhelmed in Q1/2 2020 with the spike in extra demand, a situation which has stabilised now, there is another reason, why the research team thinks the competitive moat of FBA has been somewhat eroded. This is due to the rise of click & collect, which has become such a major trend in the USA.

For Walmart click & collect (or drive up) has taken 50% of all online orders – and possibly all of US online grocery has developed like this, as it is the cheapest option for both retailers and shoppers, due to the last mile deliveries cost falling away. During the pandemic click & collect also enabled shoppers to avoid going into crowded shops.

Amazon lacks the same physical presence as its bricks and mortar competitors (Walmart, Target for example), but has started to address this with the acquisition of the Whole Foods business, the locker roll out, its click & collect partnerships (with Kohls’ for example) and of course its Go and Fresh stores.

Another prediction the publisher is making is that Amazon advertising is set for massively successful 2020 and 2021. Estimates are pegged at an annual US$20bn run rate for the business unit. And looking ahead, there might be another nascent market in audio ads (coupled with Alexa) that could grow massively in years to come.

Advertising on the Amazon platform will be driven by the sheer endless number of SKUs on the website and the problem to gain visibility for brands and sellers as a necessary prerequisite for sales conversion. In this sense Amazon follows down the path of the Alibaba model, where the Chinese platform makes most of its money from advertising rather than the listing fees. End user experience on Amazon has suffered for some time now, with the search function being overwhelmed by the sheer mass of Asins and advertising making the problem even worse.

Key Topics Covered:

1. Executive Summary

2. Latest Key Developments

  • April: Amazon increases capacity for surging online grocery
  • April: Coronavirus unmasks Amazon’s stumbles at Whole Foods
  • April: Amazon turns of recommendations temporarily
  • May: Amazon faces scrutiny as operations return to normal
  • May: Amazon invests in self driving cars
  • May: Amazon acquires Zoox for over $1.2bn
  • June: Amazon private label sellers suffering during the pandemic
  • June: Chinese Sellers on Amazon losing ground
  • June: Vogue x Amazon Fashion . is not rescuing fashion
  • June: EU commission starts investigation
  • June: UK Ultra fast fresh
  • June: Amazon is rolling out Dash shopping carts
  • June: Amazon FBA Brexit plans – EFN and Pan-European FBA ends for UK
  • July: Amazon FBA a weak point?
  • August: Amazon logistics with 10bn orders
  • August: Amazon to use JC Penney/Sears as local DCs?
  • August: Amazon Deliveroo tie up gets the all clear
  • August: Federal Trade Commission investigation
  • August: Amazon to introduce Go technology to Whole Foods
  • August: Amazon unveils first Amazon Fresh grocery store
  • August: Amazon and Tegut roll out Prime Now groceries in DE
  • September: Whole Foods to offer pickup from all of its stores
  • September: Amazon high end streaming
  • October: Amazon grocery store deals for Prime Day
  • October: Amazon Prime day 2020 – another new record
  • October: Amazon’s R rate and coronavirus cases
  • October: Amazon buys into Spartan Nash
  • October: Amazon begins hiring for four new Amazon Fresh stores
  • October: EU accuses Amazon of breaching antitrust rules
  • November: Amazon launches Key In-Garage Grocery Delivery service
  • November: The Amazon room
  • November: Amazon launches online pharmacy
  • December: Is Amazon becoming the biggest global employer?
  • December: Amazon’s advertising business booms in pandemic
  • January: Amazon investing over $5 billion in small business success
  • January: Amazon’s Covid Christmas

3. Strategy: The Structure of the 3P Marketplace

  • Amazon MP structure, the “gold rush era” is over
  • Number of Amazon sellers contributing % of volume
  • Seller X, Razor, Heroes, Upper90
  • The platform risk: Amazon’s algorithm changes
  • Thrasio Reaches $1B Valuation, Sets New US Speed Record for Unicorns
  • Thrasio – compliance check and processes
  • Thrasio’s product categories strategy
  • Thrasio paying out $100m to sellers
  • Thrasio enters Germany
  • Perch raises $123.5M to grow its stable of D2C brands on Amazon

4. Analysis – How Sustainable is the FBA Roll Up Strategy?

  • What drives the current frenzy
  • But there are major risks
  • At least Amazon will stand by, instead of consolidating the MP

5. Outlook

6. Sources

Companies Mentioned

  • Amazon
  • Deliveroo
  • JC Penney
  • Kohls
  • Kroger
  • Perch
  • Sears
  • Spartan Nash
  • Target
  • Tegut
  • Thrasio
  • Walmart
  • Whole Foods
  • Zoox

For more information about this report visit


Laura Wood, Senior Press Manager

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