Amazon’s US site is the “top streamer”, is it still making money?

Amazon’s US site is the “top streamer”, is it still making money?

Since the outbreak of the epidemic, with the increase in home life, the home furnishing category has ushered in a huge development opportunity.

 

In the United States, the e-commerce market for home furnishings has been expanding , and until last year, online sales in this category grew rapidly . But since this year, this category has changed in the US market.

 

Growth slows , US home furnishings industry retreats

 

According to data company YipitData 's tracking and observation of 30 pure furniture retailers in the United States , the GMV of the home furnishing category in the United States has maintained steady growth since the outbreak of the epidemic , and sales of many retailers have repeatedly set new highs .

 

However , by April 2022, the category’s U.S. market GMV had declined.

 

 

As inflation arrives, data shows that Americans' average ordering rate in this category remains relatively stable, with consumers ordering household items about 1.3 times per month , but spending has increased significantly.

 

Rising costs have led to higher average order values, with April data showing an 18% year-over-year increase in average order value to over $900.

 

At the same time , the monthly GMV of the top 10 home furnishing retailers has generally declined compared to last year , indicating that consumer spending on home furnishing retail products has significantly declined. Low-income consumers have begun to spend less on home furnishings.

 

Among them, the sales share of American consumers with an income between $ 41,000 and $60,000 fell by 2% year-on-year , the largest decline. In the first four months of 2022, this income group accounted for only 10.8% of the total home GMV.

 

Entering the fast lane of development, Amazon's home furnishing category exploded

 

Since 2020, Americans' demand for home furnishings has increased significantly, and the GMV of this category has continued to grow significantly . However, starting in the second half of 2021, the GMV of this category began to decline significantly.

 

In fact, since April 2021, only Amazon Home's GMV has maintained year-on-year growth . As of April this year , Amazon's GMV increased by 5.8% year-on-year. Target performed the worst, with a year-on-year GMV decline of 20% in the first quarter of 2022.

 

Between the first quarter of 2020 and the first quarter of 2022, Amazon’s home category GMV grew 84%, the largest increase among all retailers.

 

 

As of the second quarter of 2022, Amazon 's share of the U.S. home furnishing market grew by 4.7 % year-on-year . Data shows that during the Prime Day events in the past two years, almost all home furnishing subcategories on Amazon achieved year-on-year positive growth, highlighting Amazon's growing strength in the home furnishing retail industry .

 

On Prime Day, Amazon’s private label brands more than doubled their brand share in the home goods category relative to non-Prime Day sales.

 

However, this year's Prime Day data shows that the sales share of some home categories of its own brands has declined. Taking bedding as an example, its own brand sales accounted for only 3.4% of the overall sales, which is almost half of the sales of Prime Member Day last year. In addition, the share of its own brands in storage cabinets , furniture and home decoration has also declined year-on-year.

 

The market is changing, and the sales of home furnishing products are booming

 

Kitchen and dining supplies are the largest home category on Amazon , accounting for more than 30% of the GMV of all home categories in the first quarter of 2022 and more than one-third of Amazon's home GMV on Prime Day 2022 .

 

Furniture is the second largest category, accounting for about 12% of home GMV. The epidemic lockdown has boosted the strong growth of the furniture category . Between the first quarter of 2021 and the first quarter of 2022, the GMV growth rate and growth volume of this category ranked second (second only to home decoration). However , this sub-category has almost stagnated since the beginning of this year.

 

The GMV of kitchen, dining room and furniture increased by only 12% year-on-year in the first quarter of 2022. It is worth noting that although bathroom products account for a relatively small proportion, they became the fastest-growing home subcategory on Amazon in the first quarter of 2022, with a GMV increase of 40%.

 

 

Second quarter data shows that lower-priced subcategories drove Amazon's home category GMV growth , such as bathroom products ( 19.5% ) and home decor ( 17.4% ). Furniture is Amazon's second-highest revenue subcategory, but it only grew 2.5% year-on-year, the lowest of all categories.

 

Additionally, vacuum cleaners and floor care products saw the largest sales growth on Prime Day this year, with sales share more than tripling from 5.8 % on non- Prime Day to 21.0 % on Prime Day .

 

Bedroom products continue to dominate as Amazon's largest home category , accounting for more than 35% of GMV in the first quarter of 2022, an increase of 2.4 % year-over-year .

 

As consumers return to the office, " home office , " Amazon's second-largest furniture category, fell 4.5 % year-over-year in the first quarter of 2022. Conversely, living room furniture became Amazon 's second-largest category, growing 3.4 % during the same period .

 

In Prime Day 2022 , household items beat electronic products and became the "big brother" of Amazon Prime Day sales list, which is enough to show the high demand for this category in the US market.

 

Amazon is gradually dominating the online home furnishing market in the United States, and this category is gradually taking up the "banner" of Amazon's sales and volume. Sellers may continue to pay attention and consider their layout.

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