Despite widespread and mounting criticism from its third-party sellers about unfair business practices and rampant undercutting, Amazon is touting its costly efforts to support the marketplace’s many merchants.
In 2019 alone, the company spent $15 billion in launching 225 new tools and services specifically designed to aid the site’s small-to-medium-sized businesses (SMBs), Amazon said in a statement Tuesday.
That investment resulted in a record year for third-party sellers, the company claimed. More than 15,000 businesses across the platform surpassed $1 million in sales last year, while nearly 25,000 topped half that amount during the same time frame.
Across the globe, about 225,000 merchants exceeded $100,000 in sales in 2019, up from about 200,000 the year prior.
Amazon’s massive, multi-billion dollar infusion into Prime Free One-Day Delivery last year represented the company’s largest investment in its fulfillment services. While the initiative got off to a rocky start, marketplace merchants sold and shipped more than 700 million items using the new program across the U.S. last year.
“More than half of the items sold in Amazon’s stores are from small and medium-sized businesses, so our success is deeply tied to their success,” Nicholas Denissen, vice president of small business at Amazon, said. “With the investments we’re making, we are giving small businesses around the globe powerful tools and technology to help them reach hundreds of millions of customers and build successful brands.”
In addition to being able to leverage even faster delivery, brands also have access to a range of free tools within the Seller Central portal, Denissen said. Those features help sellers “gain richer insights, protect their brands, grow their sales and delight customers,” he said.
The Brand Analytics and Brand Dashboard tools, for example, allow brand owner sellers who are enrolled in Amazon’s Brand Registry program to track product performance and access traffic and conversion rates. According to the company, Amazon sellers viewed the metrics on their Brand Dashboards more than a million times in 2019.
Meanwhile, the Manage Your Experiments tool allows sellers to run trials, like A/B testing, to gauge the performance of their listing content.
The Growth Navigator provides merchants with tailored guidance about additional selling programs and features that could be leveraged to accelerate growth in their Amazon stores.
The implementation of tools like these has already helped SMBs hit new targets, Amazon claimed.
Third-party sellers saw a record holiday season in 2019, with worldwide unit sales surpassing a billion items sold and surging to double-digit year-over-year growth. And on Prime Day, sales by independent merchants far exceeded $2 billion, the company said.