Former Amazon CEO Jeff Bezos’ trip into space, whether you were a fan of it or not, perfectly summed up his ex-company’s year. Buoyed by incredible e-commerce growth, the massive marketplace is strapped to a rocket and headed for the stratosphere, on pace once again to set record revenue figures.
Though that’s nothing new for Amazon, it’s undeniably impressive.
“In 2019, Amazon’s revenue was [almost] $300 billion. And then in 2020, basically, it grew to almost $400 billion,” said Yoni Mazor, co-founder and chief growth officer at Getida, a company that works with Fulfillment by Amazon (FBA) sellers to provide auditing and reimbursement services. “So for a company at the scale of $300 billion to grow 25% in one year — it’s just ballistic.”
As the largest online marketplace in the world, Amazon (NASDAQ: AMZN) has quite a bit of sway when it comes to e-commerce, and that’s never been more true than in 2021, with U.S. retail e-commerce sales topping $450 billion — led, of course, by Amazon.
“Amazon is … it’s everything,” Mazor told Modern Shipper. “I mean, this is their marketplace, this is their house, this is their rules.”
So with 2022 knocking on the door, Modern Shipper is taking a look back at Amazon’s year and what it says about the state of e-commerce — as well as where it’s headed.
The biggest e-commerce story of 2021 has been, without a doubt, the massive volume of products changing hands through online channels. U.S. e-commerce sales have grown an estimated 16% since the start of this year, and total U.S. e-commerce sales are projected to top $1 trillion for the first time ever in 2022. Much of that value passed (and will pass) through Amazon’s hands.
“People and consumers were stuck at home. They can’t really go out — they’re in lockdowns. So Amazon and e-commerce were the superheroes that were able to fulfill their needs,” Mazor said.
But seeing Amazon’s grip on e-commerce tighten, other companies large and small have increasingly turned to digital channels. Take, for example, Walmart (NYSE: WMT); after exploding in 2020 during the first year of the pandemic, the company’s digital sales in Q3 2021 still managed to top Q3 2020 by 8%.
Watch: Inside story of an Amazon seller
But SMBs are getting in on the action too. According to a December Sendlane survey of SMBs, 92% of respondents said their e-commerce sales grew in 2021, with 21% reporting that sales grew by 40% or more. Another 91% said that their e-commerce profits grew this year, and similarly, 90% saw their site traffic increase by at least 10%.
But that growth hasn’t come without some hurdles. According to Mazor, Amazon has faced “tremendous challenges” maintaining inventory and supply — and if the largest online retailer in the world is having trouble keeping products stocked, you can bet that SMBs are struggling too.
The NRF reported in June that 97% of its approximately 18,000 member companies, which range from large corporations to mom-and-pop shops, experienced inventory shortages as they tried to keep up with the huge influx of …….