Small Businesses Help Propel Amazon to 49% of the US Ecommerce Market

The latest forecast of eMarketer’s top 10 US ecommerce retailers report has Amazon capturing 49.1% of the US market in 2018.

2018 Amazon Market Share

This is a jump of 29.2% percent in total earnings, which will see the company generating $258.22 billion in US retail ecommerce sales for the year. In terms of growth percentage, Amazon was up almost 6% from 2017’s 43.5% total market share.

One of the biggest drivers for Amazon’s growth is the integration of small businesses into its ecosystem. Amazon has more than 1 million small businesses who sell products on the site. And small retailers account for more than half of all the items sold on Amazon.

Principal analyst for eMarketer, Andrew Lipsman explained why Amazon has simplified the process of third-party integration into its platform.

In a press release, Lipsman said, “The continued growth of Amazon’s Marketplace makes sense on a number of levels. More buyers transacting more often on Amazon will naturally attract third-party sellers. But because third-party transactions are also more profitable, Amazon has every incentive to make the process as seamless as possible for those selling on the platform.”

This has resulted in record earnings for Amazon. The numbers for the second quarter of 2018 just came out, and are more than doubled what analysts had predicted. The quarterly profit came in at $2.5 billion, with reported earnings per share of $5.07, compared to the $2.50 estimates.

If it keeps going at this rate, Amazon will reach a valuation of $1 trillion before any other company.

Best Sellers on Amazon

The best sellers on Amazon, accounting for more than a quarter of its sales in the US at $65.82 billion, are items in the computer and consumer electronics category.

Apparel and accessories were second, projected to generate $39.88 billion in 2018, a 38.2% growth over 2017. While this represents only 15.4% of Amazon’s total ecommerce business, it represents an impressive 38.5% of all online apparel sales in the US.

Health and personal care and beauty account for 6.2% of total sales and food and beverage make up 1.8%. However, the growth in both segments have been a remarkable 37.9% and 40.1% respectively in 2018.

The Top 10 Sites

The top ten e-commerce retailers list in the US is clearly dominated by Amazon as it has almost half of the market to itself.

The second place is a distant behind at 6.6% which is held by eBay, followed by Apple at 3.9%, Walmart at 3.75% and The Home Depot at 1.5% for the top five spots.

At number six is Best Buy at 1.3%, Qurate Retail Group at 1.2% (this includes brands such as QVC and HSN), Macy’s at 1.2%, Costco at 1.2% and Wayfair rounding the rest of the top ten at 1.1%.

Small Business Sales

It is not surprising the top two spots are held by companies which rely greatly on small businesses for their sales. Both Amazon and eBay have a large percentage of small businesses selling products on their platform.

This type of integration gives consumers a more diversified product line and offers small business a global customer base.

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This article, "Small Businesses Help Propel Amazon to 49% of the US Ecommerce Market" was first published on Small Business Trends