Recently, at the 2024 Amazon Global Store Cross Border Summit, Dai Hongfei, Vice President of Amazon Global and Executive President of Amazon Global Store Asia Pacific, revealed a series of data and business progress, announcing that the business strategy for 2025 will revolve around innovation assistance, opportunity expansion, and local empowerment.
In the past year, the number of goods sold by Chinese sellers to consumers, businesses, and institutional customers through Amazon's global site has increased by over 20% year-on-year; In the past two years, the number of Chinese sellers with sales exceeding $1 million and $10 million has increased by nearly 55% and 60% respectively.
While e-commerce platforms such as Taobao and JD.com are adjusting their strategies and no longer relying solely on low-priced competition, cross-border e-commerce represented by Temu has achieved great success worldwide through its low-priced strategy, forcing Amazon to also start to take on the challenge.
According to SensorTower data, in August 2024, Temu's user base reached 91% of Amazon's, with over 60% of users preferring Temu in surveys across 84 countries and regions, particularly in Europe where users in 28 countries prefer Temu. As of September 1, 2024, Temu, which has been online for over two years, has provided services in 78 countries and regions.
According to HSBC, Temu's GMV (Gross Merchandise Volume) is expected to grow to $140 billion by 2027, surpassing Alibaba, SHEIN, and TikTok, achieving the highest GMV growth rate in China's cross-border e-commerce.
For this reason, Amazon, which came late, has decided to launch the low-priced marketplace Amazon Haul to cope with the impact of Chinese e-commerce companies.
All Amazon Haul products are priced at $20 or less, with most products priced around $10 or less. Orders over $50 offer an additional 5% discount, and orders over $75 offer an additional 10% discount. It is worth noting that the delivery time provided by the mall is one to two weeks, which is longer than the fast delivery of Amazon Prime members.
Amazon Haul is in its early stages, with a lot of internal learning and optimization processes, and currently there isn't much to publish Dai Hongfei said in an interview with media outlets such as Interface News.
Amazon Haul is currently only available in the United States and adopts an invitation based system. The first batch of Chinese sellers invited to join have three major characteristics: first, existing sellers who have cooperated with Amazon; Secondly, it has advantages in cost, price, and category; Thirdly, it is possible to transport the goods to Amazon Dongguan Operations Center.
In Dai Hongfei's opinion, different consumers have different demands for low-priced products. "We need to have a more detailed understanding of what customers' specific needs are. Many customers are not too concerned about brand and delivery speed, but more about cheap prices
In this round of global low price e-commerce war, small and medium-sized factory sellers with price and cost advantages have become customers that e-commerce platforms such as Amazon are competing for.
The maturity of China's industrial belts is very high, and they have completed the vertical integration of production and product research and development. The product competitiveness of these industrial belts is very strong. "Yang Jun, Vice President of Amazon China and Head of Business Development and Regional Management for Amazon Global Store Asia Pacific, also believes that the core driving force of China's cross-border e-commerce lies in using rapid product innovation to meet consumer needs that have emerged but have not yet been fully met. Under this premise, the company has developed over 400 industrial belts distributed across the country, hoping to improve the quality of cross-border supply chains and accelerate product innovation.
It is expected that by 2027, Amazon's "Industrial Belt Accelerator" project will cover more than 150 Chinese industrial belts, supporting tens of thousands of factories or brand merchants to launch on Amazon.
Peng Jiaqi, Vice President of Amazon China and Head of Product and Seller Education for Amazon Global Store Asia Pacific, stated that the key to the "Opportunity Expansion" business strategy lies in the differentiation of product categories, identifying products that are currently in demand but in short supply, and exploring more opportunities from the perspectives of category, self positioning, and business opportunity expansion.
In terms of product selection, based on the existing product selection compass and business opportunity detector, Amazon plans to launch the "Unmet Demand Insight" function in 2025.
According to data provided by Amazon, from the beginning of 2024 to October 31, the number of new FBA (Amazon Logistics) products listed by Chinese sellers has increased by nearly 30% year-on-year, with over 35% of product sales coming from newly selected products created within 12 months. Chinese brand sellers' sales on emerging Amazon sites have increased by over 60% year-on-year.
In addition, Amazon has launched a series of programs, including the Amazon Influencer Program and the Content Creator Program, aimed at attracting consumers to purchase within multiple overseas social media apps. It has also upgraded the BuywithPrime program to help sellers establish and expand their business on their independent sites and other sales channels outside of Amazon. A series of e-commerce tools based on AI and big data, such as the AI driven instant messaging tool ConnectPro, intelligent shipping schedule estimation, and automated customs clearance tax number classification, have also been released at the same time.
In the trend of global commercial procurement shifting towards online, Amazon Enterprise has become one of the fastest-growing businesses on the platform globally. More and more Chinese sellers are embracing both B2B (enterprise) and B2C (consumer) business opportunities as a key development strategy.
During the summit, Amazon announced that it will open its Irish site to Chinese sellers by 2025, making it the tenth site in Europe to be opened to Chinese sellers. At that time, Chinese sellers will be able to conduct business on Amazon's 20 international sites worldwide.
Amazon's supply chain intelligent hosting service has officially opened up to Chinese sellers, providing end-to-end cross-border supply chain solutions. In the past three years, the number of Chinese sellers on Amazon who have both B-end and C-end businesses has nearly doubled, and the total number of Amazon Enterprise Purchase sites open to Chinese sellers has reached 10.
The company emphasizes that since the launch of Amazon's overall supply chain solution at the end of 2023, hundreds of thousands of sellers worldwide have used at least one Amazon supply chain service. As of the end of October 2024, the number of Chinese sellers using two or more Amazon supply chain services has increased fourfold.