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Third Party Merchants Drive Amazon Growth

A new report shows how much Amazon relies on third-party merchants for selection and for growth. RW Baird’s 11th quarterly “Amazon Selection Survey” covered the company’s third-quarter. It estimates that overall, there are 391 million items listed for sale on Amazon.com, a 43% increase year-over-year adjusted for anomalies. Of those, 36 million items are now eligible for Prime shipping.

“Third-party unit momentum continues,” the Baird report stated. “As expected, third-party unit growth continues to outpace first-party units. In our survey, Amazon-as-seller SKUs grew 25% Y/Y (+18% ex-Media), vs. 43% adjusted unit growth, indicating continued 3P momentum.”

And not surprising RW Baird found that Fulfillment By Amazon adoption was a key lever to driving growth in the third quarter.

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FBA allows Amazon to better manage the customer experience and increase the range of products eligible for Amazon Prime, according to Baird analyst Colin Sebastian. “We see this as creating a virtuous cycle of increasing Prime subscriptions, further category expansion and greater unit velocity.”

The survey also found:

  • There’s steady growth in FBA adoption in the majority of product categories.
  • Home & Kitchen and Apparel categories dominate SKU growth;
  • There are 119,000 SKUs available in Amazon’s new Handmade store.

Sebastian said the survey suggests sellers in the Video Games, Toys & Games, and Grocery & Gourmet Foods categories are adopting FBA at the fastest rate.

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Ina Steiner

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. Send news tips to ina@ecommercebytes.com.


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