The Rise & Rise of Amazon

Click for WSJ interactive version

A rather telling graph from the WSJ in conjunction with Internet Retailer. There’s an interactive version available if you want to look at the individual retailers and underlying $ numbers.

The article has arisen apparently because of  the US Securities and Exchange Commission (SEC)  pushing for greater disclosure of the eCommerce element of revenues by certain  large chains. This arose following a, we think, not untypical statement accompanying a results announcement. In this case it was during a conference call by Target when an almost classic “grew faster than industry averages” statement was attributed to their latest quarters online & mobile sales! Internet Retailer also has the story.

We would be wholly in favour of this increased disclosure by all retailers. To us the proportion of revenues by channel where one is/some are growing, whilst others contract is an important consideration for all investors both here, over there and elsewhere!

Getting back to the sheer size and growth of Amazon it is quite remarkable how little, relatively, market share has been obtained by other top online retailers in the last decade.

In 2003 Amazon represented in revenue terms 30% of the (then) top 11 and Dell was in second place with 16%, third was Office Depot with 15% and the only other one over 10% was Staples at 12% . Now ten years later after the 4 additions (Office MaxMacysNewegg  and WW Grainger) Amazon has grown to just under 50% of the total (48%) and the only other retailer with over $10 billion sales is Staples with a mere 8% of the total.

On the overall size front Amazon overtook for the first time in 2007 THE TOTAL GB online sales and last year at $61 billion was some  26% greater than our £29 billion at current exchange rates ($1.55=£1). OK we know there’s some double counting of Amazon sales in the ONS figures but even so ….

Disclosure: We have marketing affiliate arrangements with Amazon.

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