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Seven Amazon Statistics That Break Down Its Business Model
Online stores still represent the backbone of the Amazonbusiness model with almost $124 in revenues for 2018
Amazon has a diversified business model. In 2018, online stores contributed to nearly 52% of Amazon revenues, followed by Physical Stores, Third-party Seller Services, AWS, Subscription Services, and Advertising revenues
In 1999 Amazon third-party sales contributed to only 3% of Amazon gross merchandise sales
Amazon third-party sales contributed to 58% of the total gross merchandise sales on Amazon in 2018
Amazon AWS is the fastest growing business unit, with over $25 billion in sales in 2018 and over $7 billion in operating margins
Amazon is grabbing a growing piece of the digital advertising cake, with about $10 billion in revenues from advertising in 2018
Amazon core business is in the US with over $160 billion in revenues in 2018, but it is diversified globally
Over the years, Third-party sales have grown from 3% of the total to 58%. Amazon helped independent sellers compete against its first-party business by investing in and offering them selling tools (inventory management, payments processing, shipments tracking, reporting).
Programs like Fulfillment by Amazon and the Prime membership program improved the customer experience of buying from independent sellers, which made this business grow substantially over the years. In 2018, gross merchandise accounted for 58% of the total Amazon online sales.
Amazon AWS is among the fastest growing Amazon business unit. With its scalable infrastructure, AWS grew to over $25 billion in revenues in 2018.
Also, AWS carries high operating margins compared to the rest of the Amazonbusiness model. Indeed you can see from the graphic below, how AWS contributed to 58.7% of Amazon overall operating income, in 2018.
data in billion dollars
All segments (except AWS)
data in million dollars
Amazon advertising business compared to Facebook, Google, and Bing
To put things in context, Amazon advertising business has been growing substantially, and not it competes with other media tech players, like Google, Facebook, and Microsoft.