As the new year begins, Amazon FBA sellers might be curious about what 2023 has in store for them.
With e-commerce only growing, and Amazon’s profits regularly exceeding expectations, there’s no doubt it is a great time to sell on Amazon. In its 2020 Q4, Amazon earned $125.6 billion, leaping past Wall Street predicted $119.7 billion. In 2020 overall, Amazon’s revenue reached $386 billion, an increase of $100 billion from 2019.
Amazon spent $4 billion on coronavirus measures, laying the groundwork to be one of the few businesses that emerged from the pandemic even more successful. As Amazon continues to develop its interests, ranging from entertainment to marketing, to groceries, keeping pace with its trends becomes imperative. For Amazon FBA sellers in 2023, this means keeping an ear to the ground to find out what’s coming.
Want to stay ahead of the curve? Let’s take a look at what’s next for Amazon.
1. Entertainment Expansion
Though Amazon Prime Video is already a leading streaming platform, rivaling Netflix in 2022, this year promises to be one of further entertainment expansion. Prime Video has garnered critical attention with a range of Emmy nominations, and well-received Amazon Original films. Amazon Music HD has been making strides on the music front, offering high-quality streaming to pair with new Echo speakers or wireless earbuds.
In 2023, Amazon will continue to push to the forefront of the entertainment industry, securing itself a place at the top. It is fitting that a company that started out selling books is cornering the entertainment industry from so many new angles.
2. Sustainability developments
Amazon might be best known for prioritizing the customer experience, but thanks to increasing industry pressures, 2023 will see a sustainability focus as well.
In India, a Packaging-Free Shipping program is underway, and Amazon has made a deal to acquire 100,000 electric vehicles from Rivian. Along with increased use of solar power, these are steps towards the company’s goal of using 80% renewable energy by 2024 and hitting the ultimate goal of zero emissions by 2030.
3. Ad industry disruption.
In 2023, Amazon will increase the number of customers reaching their products through Amazon searches, rather than via Google or Facebook in the form of sponsored ads. With more customers searching primarily on Amazon itself, the middlemen of other websites will be steadily removed.
Websites like Google get the majority of their revenue from ads; ads make up 85% of Google’s revenue in fact. Meanwhile, Facebook gains a startling 94% of its revenue from ads. On the other hand, Amazon comes in with just 4% of its revenue coming from ads, however, the platform is in the advantageous position of also being one of the world’s largest marketplaces.
In the coming year, Amazon is in an intriguing position to lessen the sway of external search engines on its business.
4. Attracting FBA sellers
It’s no secret that Amazon is a profitable platform to sell on, and an increasing number of brands will realize this in the coming year. This is a smart move given that 44% of companies that sell on Amazon make over half their e-commerce sales via Amazon. Meanwhile, 32% of the brands that sell on Amazon earn 75% of their online sales on the platform. Being on Amazon is undeniably good for business.
Impressively, 97% of brands that are already on Amazon hold it to be true that selling on Amazon brings in new customers, and perhaps more impressively, 84% of brands that are not on Amazon hold this to be true.
If you are interested in making e-commerce sales, selling on Amazon is well worth considering.
5. Taking groceries online
In 2023, Amazon will continue to take steps into the food and beverage market, increasing customer access to groceries online. Amazon’s acquisition of Whole Foods was a notable move in 2017, and situated Amazon to face its primary competitor in this market: Walmart.
Around the world, only 3% of e-commerce sales are food and beverage based, but this is anticipated to expand to 4.5% by 2024, changing the landscape of grocery shopping. As Amazon and Walmart jostle for positions in this growing niche, plenty of opportunities will arise. In the coming year, we’ll see more steps toward Amazon’s hold on the food and beverage market.
6. Voice services
Voice search technology is here to stay and expected to continue to grow as we move into the following year. Amazon emerged as the top-selling speaker brand in 2018 with a robust market share of 31.9%
Common reasons for users to employ voice service technology include: controlling other devices remotely, checking the weather or news, looking up information, and playing music.
Voice searches are a means for Amazon to connect customers to other services, and integrate Amazon into everyday life. Customers can expect Alexa and Amazon algorithms to improve, developing better product suggestions to meet needs.
7. Brand registry features
If you sell on Amazon, you’re likely aware that counterfeit products are a constant issue. The disappointment of seeing your product imitated and sold is considerable. To protect companies from having their innovations hijacked, Amazon offers the Brand Registry to ensure the accurate classification of products.
In the coming year, Amazon will continue to finesse the capabilities of the Brand Registry. This includes listings of approved sellers, as well as control of certain content, making it more difficult for counterfeits to survive and thrive.
8. Technology strategy
Amazon is poised to put technological innovation to advantageous use in 2023. Since its Artificial Intelligence conference this year, Amazon has made it clear it will be a leader in AI innovation in particular.
By analyzing and using valuable information about customer behaviors, Amazon can continue to draw customers in, and better predict their next moves. This improves the customer experience and creates more opportunities to generate sales.
Given Amazon’s unique position to leverage technology, it’s wise to become an FBA seller on the platform in 2023.
The future of Amazon undoubtedly holds further expansion into other marketplaces and acquisitions of relevant entities. By nature, Amazon is a platform that supports third-party sales, and the company has gained a powerful foothold in many other interests as well. We can expect Amazon to continue to diversify in 2023.
Rather than compete with rival companies, Amazon will acquire them and further develop their products when possible. Leveraging its formidable size, Amazon will acquire product patents as well, securing its hold on the market.
Going forward into 2023
As an Amazon seller, you are no stranger to Amazon’s industry disruptions, and in all likelihood, 2023 will show us more unprecedented change. As a global titan, Amazon’s next moves can be difficult to predict, but there are a few areas in which you can expect to see development from technology to sustainability to entertainment.
Amazon will continue to grow and take center stage, never backing down from taking on new spheres and diving into fresh challenges. For those in Amazon’s way, this can be an intimidating notion, but for those moving with this company as FBA sellers, the forecast is looking sunny.
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