Turning point? Amazon may replace Walmart as the largest retailer in the United States

In the past two years, the US e-commerce industry seems to have hit the pause button, and has lost its former "wild growth". Consumers have also returned to offline shopping, and some even wonder if the US e-commerce industry has reached its ceiling.

However, recently, two JPMorgan analysts, Doug Anmuth and Brian Smilek, expressed different views. According to them, 2024 will be an important milestone for Amazon, that is, it will surpass Walmart to become the largest retail giant in the United States.

This expectation also reflects the outside world's expectations for the e-commerce industry. Although it has achieved rapid development during the epidemic, most e-commerce companies have performed mediocrely in the past two years, and some have even been struggling on the brink of bankruptcy.

Some analysts pointed out that last year was the first time since 2009 that the growth of the US e-commerce industry was less than 10%. The main reasons may be factors such as weak macroeconomics, the recovery of physical retail, and changes in consumer habits in the post-epidemic era.

However, many analysts believe that this year may be a turning point for the US e-commerce industry, and Amazon will be the pioneer in sounding the clarion call for a counterattack.

According to JPMorgan Chase, Amazon's gross merchandise volume (GMV) will increase 11.6% year-on-year to $477 billion in 2023.

This growth mainly comes from categories with low penetration rates, such as groceries and clothing. In addition, Amazon's delivery capabilities are also constantly improving. In 2023, Amazon may achieve the fastest delivery speed ever.

On the other hand, Amazon's Prime subscription service still has a lot of room for development, which can further help Amazon improve user stickiness.

JPMorgan Chase estimates that by the end of this year, there will be about 300 million Prime members worldwide. In addition, analysts at the agency also predict that by the end of 2023, Amazon's e-commerce market share in the United States will further expand, and its monopoly momentum will become more obvious.

There is another reason why Morgan Stanley is so optimistic about Amazon. This year, AI concepts and Chat GPT are very popular, and Amazon obviously does not want to miss this opportunity, and has deployed functions similar to Chat GPT in many fields.

The application of AI in customer service is particularly obvious. AI can provide users with more intelligent services. In addition, sellers may also use AI to analyze consumers' purchasing habits and make more effective marketing strategies.

One problem, however, is that tech giants like Amazon have come under increased government scrutiny in recent months. Last week, the Federal Trade Commission sued Amazon, alleging that it has been deceiving users into signing up for Prime memberships and making it more difficult to cancel subscriptions.

This is indeed a big blow to Amazon. If the growth of Prime members is missing, a series of future growth goals may not be achieved.

Amazon

Walmart

American e-commerce