Amazon 2015Release date: September 22nd, 2015 (156 pages) PDF/Powerpoint format. Price: GBP1,990.00 |
Abstract
By judging the sheer amount of Amazon’s innovations over a 12 months period from the Twitch acquisition to Prime Day and beyond, one quickly grasps the company’s relentless energy to become the “Everything Store”. Ama- zon’s astonishing ambition that consumers should only need Amazon for their shopping and entertainment needs is unmatched and, perhaps, attainable.
This report analyses the latest activities of Amazon across its numerous business interests including food (Fresh), cloud computing (Amazon Web Service), Kindle, and on- line marketplaces, both home and abroad. These are sup- plemented with key financials and performance indicators that offer deeper insights into the company.
Amazon’s loyalty scheme Prime and the 3P marketplace are covered in depth since they are the foundations on which Amazon’s catch-all ecosystem is being built. With the stickiness these platforms provide, Amazon can afford to experiment with drones, connected kitchen devices, smartphones and so on to extend its presence in every aspect of shoppers lives.
Amazon is a fascinating and truly unique company. No other retailer has the logistical muscle and self-belief to try and monopolise shoppers’ online retail spending. Wi- thout genuine competition, Amazon’s domination may well know no bounds.
Table of contents
Executive Summary | p12 |
Recent key developments | p19 |
August 2014: mobile payments, Local register – a US solution first and foremost | p20 |
August 2014: Twitch acquisition, selling physical books in Brazil, Shanghai | p21 |
September 2014: Surge soft drink, CFO retires, Kindle e-reader and tablets in Canada | p22 |
October 2014: Fresh entering Brooklyn, order threshold of $35 | p23 |
October 2014: Direct shipping China, India Post | p24 |
October 2014: Pay with Amazon in India, Sydney data centres | p25 |
October 2014: AWS in Germany | p26 |
October 2014: Physical store plans NY, more of a warehouse than a store? Or an office? | p27 |
October 2014: Same-day pickup launched in the UK | p28 |
November 2014: AmazonFresh in Philadelphia, using NY template | p29 |
November 2014: Same day delivery in Canada, Job creation in Ireland | p30 |
November 2014: Netherlands launch | p31 |
November 2014: Amazon ends damaging Hachette dispute | p32 |
December 2014: Takeout & Delivery is officially launched in Seattle | p33 |
December 2014: Amazon Elements, pick up points in Canada | p34 |
December 2014: Click & Collect in Spain | p35 |
January 2015: the mobile wallet fail | p36 |
February 2015: Prime Now available across Manhattan, Purdue campus store | p37 |
February 2015: Purdue campus store | p38 |
March 2015: Amazon Dash button and scanner released | p39 |
March 2015: Bleecker Street, second Tmall shop | p40 |
March 2015: Hyperlocal service in India, Amazon move into Toronto skyscraper | p41 |
March 2015: Amazon Publishing enters France, change at the top | p42 |
April 2015: AWS open Dutch office, Net-a-Porter rejects Amazon | p43 |
May 2015: Partnership with Jet in the UK | p44 |
April 2015: Cloud revenues, car boot delivery, Jabong acquisition called off | p45 |
April 2015: Prime stations and increasing product eligibility by 47% | p46 |
April 2015: Amazon sues fake review provider firms | p47 |
April 2015: Amazon cheapest groceries provider in New York | p48 |
April 2015: Japan sells electric cars | p49 |
April 2015: Remote Canadian communities lose free delivery | p50 |
May 2015: Drone testing in Canada, tax adjustments, Fire TV Stick | p51 |
May 2015: Delivery via subway, Amazon Japan record label | p52 |
May 2015: Amazon relaunches supply as Amazon business | p53 |
June 2015: Launches Prime Music in the US, Prime Now in the UK | p54 |
June 2015: Alexa, AI and machine learning improving the customer review system | p55 |
June 2015: Antitrust investigation, Kindle, Canada, loan business to 3P sellers | p56 |
June 2015: Developments in India and Mexico | p57 |
June 2015: Mexico expansion | p58 |
June 2015: Amazon relaunches private label grocery products after diaper fiasco | p59 |
June 2015: Amazon relaunches private label grocery products | p60 |
June 2015: Amazon launches Prime day | p61 |
June 2015: Amazon launches Prime day | p62 |
June 2015: Amazon grocery drive thru plans | p63 |
June 2015: Treasure Truck in Seattle, launch shelved | p64 |
June 2015: Treasure Truck | p65 |
July 2015: Prime Music in the UK, Amazon TV, Top Gear, London Fashion studio | p66 |
July 2015: Food added to Amazon Italy | p67 |
July 2015: Spain developments, Amazon facing trademark lawsuit in SF | p68 |
July 2015: Further investment into India, acquires former biscuit factory in Ireland | p69 |
August 2015: Amazon to stop Collect+ service, new London data centre | p70 |
August 2015: Stock record, Bezos cashes in, Amazon Fresh to come to the UK? | p71 |
August 2015: new DC in Illinois, AWS in South Africa | p72 |
August 2015: Trade-in service to close, Prime Now in Seattle, Amazon Flex | p73 |
August 2015: Prime Now in Seattle, Amazon Flex | p74 |
Financials, KPIs, Benchmarks 2008 – 2014 | p75 |
Amazon: Net Sales, Net Income, Growth, Margin 2008-2014, adding $14.5bn in a year | p76 |
Amazon: more than $13bn added every year since 2011, a $100bn retailer in 2015 | p77 |
Amazon: US Sales, growth, international sales, in $m, % split 2008-2014 | p78 |
Amazon: Sales by segments 2008-2014 in $m, growth | p79 |
Amazon: AWS, transposing the marketplace model from physical to digital | p80 |
Amazon: A couple of words on margins, what is the impact of 3P’s rapid growth? | p81 |
Amazon: 3P has overtaken 1P in value terms | p82 |
Amazon: The «Key» Key Performance Indicator | p83 |
Amazon: inventories and cash flow, marketplace as the core of the model | p85 |
International expansion strategy | p86 |
Amazon: International expansion strategy, 3 core factors, online is global | p87 |
Amazon: The platform, incrementalism, the threat from copy cats, Amazon’s dilemma | p88 |
Financials, KPIs, Benchmarks in Amazon geographies 2008 - 14 | p89 |
Amazon: International sales per country in €m 2008 -14, Germany, Japan, UK, France | p90 |
Amazon: Int’l sales per country in €m, China, Italy, Spain, India, Brazil | p91 |
Amazon: Int’l sales per country in €m, Australia, Mexico, Netherlands | p92 |
Amazon: International sales per country in local currencies 2011-14, Japan, UK | p93 |
Active customer accounts per Amazon geography and annual basket spend 2009 - 14 | p94 |
Amazon: Active Customer accounts 2009 – 14 in m, USA, Germany, Japan, UK, France | p95 |
Amazon: Active Customer accounts, Analysis | p96 |
Amazon: Sales grow faster that active customers, basket growth, category cross shopping | p97 |
Amazon: Average annual spend 2011 – 14e, USA, DE, Japan, UK, France in local currency | p98 |
Amazon: Average annual spend 2011 – 14e on AMZN 1P, Analysis | p99 |
Amazon: 1P Sales by geography in $m, average price, total units, customers, frequency | p100 |
Amazon: average price, total units, customers, frequency per country, Analysis | p101 |
Amazon: Best seller average prices 2013, 2014, 2015 TD in local currency | p102 |
Prime: the loyalty scheme par excellence 2009 - 14 | p103 |
Prime – behind the “death of bricks & mortar loyalty”? | p104 |
Prime: What we know and what we have to estimate | p105 |
Prime: retention and the importance of the streaming business | p106 |
Prime: How big can membership grow? Adding new features | p107 |
Prime: Prime Now adding a service and premium layer | p108 |
Prime: Prime day, essentially impossible to copy for competitors | p109 |
Prime: Prime Customer accounts 2009 – 14 in m, USA, Germany, Japan, UK, France | p110 |
Prime: The jewel in the loyalty crown, past strategy: stable price - more content | p111 |
Prime: focus on most loyal shopper to drive sales and profits | p112 |
Prime: Most successful tool to get buy-in to new categories, net costs, uplifts | p113 |
Prime: the 7 key Prime benefits to Amazon (I) | p114 |
Prime: The 7 key Prime benefits to Amazon (II) | p115 |
The core of the business model: the marketplace | p116 |
Strengths of marketplaces: The model | p117 |
Strengths of marketplaces: the data benefits | p118 |
Strengths of marketplaces: the data benefits, pricing power | p119 |
Strengths of marketplaces: pricing power, beneficial cash flow | p120 |
Strengths of marketplaces: beneficial cash flow, unlimited range | p121 |
Strengths of marketplaces: unlimited range | p122 |
Strengths of marketplaces: network effects | p123 |
Amazon’s marketplace 2010 – 14 | p124 |
Amazon marketplace: the game changer | p125 |
Amazon MP: 3P commissions and fees, another 10% for FBA, risk of being replaceable | p126 |
Amazon: Net product, service sales, units shipped, 3P % share 2009-14 | p127 |
Amazon: The main marketplace winner, contribution in value terms (in US $m) 2010-14 | p128 |
Amazon MP: 3P sales in US$m in 2010 – 2014, 3P bigger than 1P | p129 |
Amazon marketplace: rapid expansion financed through marketplace cash flow | p130 |
Amazon marketplace: stocking stores versus populating a website, long tail economics | p132 |
Amazon forecasts 2010 - 16 | p133 |
Amazon forecast: Amazon’s sales in US$m 2010 – 2016 | p134 |
Amazon forecast: Amazon’s 3P sales in US$m 2010 – 2016 | p135 |
Amazon forecast: Amazon’s GMV in US$m 2010 – 2016 | p136 |
Connected kitchen devices – Dash buttons | p137 |
Amazon Dash: scan and button, all invite only and Prime for now | p138 |
April 2015: Amazon Dash as FMCG giants’ tool | p139 |
April 2015: Prime conversions on grocery at 60% | p140 |
Others: Chronodrive partnership with Hiku, Waitrose, Carrefour Belgium | p141 |
Carrefour: connected kitchen in Belgium, a great step forward in food retailing? | p142 |
Connected kitchen devices: 5 common characteristics and benefits | p143 |
Table 1: Amazon: Net Sales, Net Income, Growth, Margin 2008-2014, adding $14.5bn | p76 |
Table 2: Amazon: US Sales, growth, international sales, in $m, % split 2008-2014 | p78 |
Table 3: Amazon: Sales by segments 2008-2014 in $m, growth | p79 |
Table 4: Amazon: International sales per country in €m 2008-14, Germany, Japan, UK, France | p90 |
Table 5: Amazon: Int’l sales per country in €m, China, Italy, Spain, India, Brazil | p91 |
Table 6: Amazon: Int’l sales per country in €m, Australia, Mexico, Netherlands | p92 |
Table 7: Amazon: International sales per country in local currencies 2011-14, Japan, UK | p93 |
Table 8: Amazon: Active Customer accounts 2009 – 14 in m, USA, Germany, Japan, UK, France | p95 |
Table 9: Amazon: Average annual spend 2011 – 14e, USA, DE, Japan, UK, France in local currency | p98 |
Table 10: Amazon: 1P Sales by geography in $m, average price, total units, customers, frequency | p100 |
Table 11: Amazon: Best seller average prices 2013, 2014 – 2015 TD in local currency | p102 |
Table 12: Prime: Prime Customer accounts 2009 – 14 in m, USA, Germany, Japan, UK, France | p110 |
Table 13: Amazon: Net product, service sales, units shipped, 3P % share 2009-14 | p127 |
Chart 1: Prime – behind the “death of bricks & mortar loyalty”? | p104 |
Chart 2: Strengths of marketplaces: The model | p117 |
Chart 3: Amazon: The main marketplace winner, contribution in value terms (in US $m) 2010 - 14 | p128 |
Chart 4: Amazon MP: 3P sales in US$m in 2010 – 2014, 3P bigger than 1P | p129 |
Chart 5: Amazon forecast: Amazon’s sales in US$m 2010 – 2016 | p134 |
Chart 6: Amazon forecast: Amazon’s 3P sales in US$m 2010 – 2016 | p135 |
Chart 7: Amazon forecast: Amazon’s GMV in US$m 2010 – 2016 | p136 |
Chart 8: The benefits – Darty | p146 |