As was expected, the last year for Amazon was just great. The company announced that its ‘Fulfillment by Amazon’ (FBA) service delivered a record number of more than 2 billion items for sellers last year. However, it is not the only Amazon service that shook the business world in 2016.
Record Breaking Numbers
It is known that people from more than 130 different countries worldwide fulfilled orders to customers in 185 countries. The online retailer said active sellers using the FBA service increased more than 70 per cent in 2016, and units shipped grew more than 80 per cent outside the U.S. It is not a surprise that the peak was reached during the holiday season, at this time items shipped by FBA grew more than 50 per cent.
Another achievement that Amazon can proud is that sellers who reached $100,000 in sales rose by 30 per cent. And this is not the end of it – Amazon has estimated that these sellers have created more than 600,000 new jobs around the world!
Also, it received the appropriate reaction of markets because Amazon shares have gained 18 per cent in the last 12 months, while the Standard & Poor’s 500 Index (S&P 500) has gained 12 per cent.
The biggest advantage of FBA is that the programme enables third party Marketplace sellers to scale their business by handing over the heavy lifting of storing, delivering, payment processing and customer service to Amazon.
Francois Saugier, Vice President of Amazon EU Seller Services, commented: “2016 was another record breaking year in sales for sellers across the world on Amazon Marketplace. One of the biggest innovations for small businesses selling on ‘Amazon Marketplace’ has been FBA, whereby we store, pick, pack and deliver items to customers on behalf of smaller businesses to help them scale, increase sales and create jobs.”
It also helps sellers to grow their business by making their products eligible for ‘Amazon Prime’. It means they will have access to millions of Amazon’s most loyal customers.
Simon Johnson, Director of Amazon Seller Services UK, said: “Independent research shows that 74,000 people are employed by UK sellers as a result of their business selling on ‘Amazon Marketplace’. It is great to see UK businesses going from strength to strength, and our role is to continue to support their growth and success.”
Amazon ‘Sponsored Products’
Another interesting Amazon service is ‘Sponsored Products’. This programme helps you promote the products you list on Amazon.co.uk. You choose which products you want to advertise, assign keywords and enter a cost-per-click bid. When an Amazon shoppers search for one of your keywords, your ad is eligible for display alongside the search results.
It is estimated that more than 20 thousand sellers in EU are already using this programme to make their products stand out. The number of sellers worldwide using ‘Sponsored Products’ grew more than 100 per cent last year. Its clicks worldwide grew by more than 150 per cent driven by expansion of advertising placements on desktop and mobile sites.
Despite the huge success in the U.S., Amazon had some remarkable events related to international expansion last year. ‘Handmade at Amazon’ (www.amazon.co.uk/handmade) was launched in Germany, France, Italy, Spain and the United Kingdom. That expanded its selection of handcrafted artist made goods to customers in the EU.
The ‘Handmade at Amazon’ store also was improved. Managers have added six new categories: Baby, Toys and Games, Accessories, Pet Supplies, Beauty & Grooming. Now they offer more than 500,000 items sold directly by artists across all 50 U.S. states from 80 countries around the world.
Last year Amazon implemented many projects to expand their services. One of them was the ‘Amazon Lending’ programme, which offered loans for sellers on Amazon to help them develop their businesses. That has contributed to higher profit – more than $4 billion.
Using the new programme called ‘Amazon Launchpad’ (www.amazon.co.uk/lanunchpad) the company could successfully increase its international respectability. Many capital firms, start-up accelerators, and crowd-funding platforms have worked with ‘Amazon Launchpad’ that helped more than 1,000 start-ups create new products in the U.S., U.K., China, Germany, and France.
New start-ups are joining the ‘Amazon Launchpad’ programme every day to use FBA infrastructure to launch their business, create awareness and drive sales in Europe and over the world.
Moreover, Amazon introduced the ‘Pan-European FBA’ programme allowing sellers to build their international business by selling across all Amazon European marketplaces while shipping inventory to just one destination.