2020 has brought us so much change in the eCommerce world as we have witnessed a decade’s worth of growth in a short period of time. The pandemic that shattered traditional commerce as we once knew it forced a shift in consumer shopping habits to online. COVID-19 has pushed more retailers into the digital space, and marketplaces, like Amazon, are amongst the biggest beneficiaries. We are on pace to see a 32% YoY growth in eCommerce, and Amazon owns about 39% of the market share.
On that note, let’s take a look into the future and make a few new predictions for how running an Amazon FBA business will be different in 2021. The responses are brought to you by our team here at BellaVix.
While we are hopeful that the pandemic will subside in 2021, my guess is that buyers will continue to increase on Amazon, and hopefully, the economy will make a drastic improvement as jobs return. We also have a new administration/President and what will that mean to Amazon for anti-trust issues?
Will we see more competition from Walmart and Target? I personally have ordered more from Walmart this year due to shipping and stock issues with Amazon – and the launch of Walmart Plus – the Amazon Prime competitor. Pricing is better on regular items as well as compared to Amazon. In my building’s package room, I’m seeing a lot more Target and Walmart boxes!
So my prediction is increased competition.
– Jennifer Hozer – BellaVix Project Manager
We expect to see online shopping trends will continue to increase even if the pandemic is over. Those skeptical buyers have experienced the benefits of deliveries right to their doors. It’s hard to go back to the old ways after this.
Speaking of convenience, Subscribe and Save offers will be more utilized as people transition to online shopping and become more comfortable with the service.
Creative assets are currently underrated, but in the digital age, these are extremely important and not to be overlooked. I expect Amazon Posts to continue to evolve into a social media platform where both users and brands engage each other.
As we’ve seen recently, Amazon implemented restocking limits to ensure they have faster-moving items than slow-moving items in their warehouse. After all, FBA fees do make a big chunk of their income. I don’t think this will change anytime soon, or ever, as this will actually help Amazon clear out the weeds in their warehouse and fulfillment method.
– Stefania Pilindavic – BellaVix Project Manager
I will be pointing out the more troublesome issues from a macro perspective. Roughly 21 million Americans are getting insurance state or federal; that’s 13% of the US labor force. If you add to that the so-called discouraged workers, those who’ve given up looking for a job, at least for the time being, and the large numbers of people who have only part-time jobs or jobs you get that half of the labor force in the US society falls in this category. We might be looking at a recession, despite the new president-elect. If you look at the stock market, stocks fall after elections if the recession is looming. The Covid crisis might be the thing that is going to overturn the scale.
Another issue that is going unnoticed but affecting us directly in eCommerce is that all this increase in demand from the online purchases is burdening the delivery companies. UPS and FedEx are all reporting shortages of vehicles. Van shortages are accompanied by a disruption in manufacturing in the auto industry. All of this will lead to the increased delivery time and new restrictions from Amazon.
On the bright side, this has happened before. The US will survive and people will continue buying even more online, for which we are perfectly positioned.
On the Advertising side of things, Amazon is continuing to improve the platform, adding new features like directly harvesting keywords from the campaigns and new better reporting even for the Sponsored Display ads. The next big thing for Amazon ads, I think will be exactly these types of ads. Further integration, adding more features, more insight with reports, and more levers for optimization.
– Aleksandar Gadjovski – BellaVix Advertising Manager
2020 has drastically increased the number of new online shoppers, and Amazon gets more and more saturated with brands every day. Customer retention has become very challenging. My prediction is that Amazon will provide more ad features to their Sponsored Brand and Sponsored Display campaign types to make laser focus targeting and marketing spend more efficient (Amazon already has rolled out a bunch of new report types for more insightful decision making). It’s crucial for brands to keep up with all new features available and adopt them as early as they can so that they can stay ahead of the competition.
– Olena Korzh – BellaVix Advertising Manager
Amazon has already been experimenting with live video as a form of marketing, and since its whole purpose is a great customer experience, I believe it is going to invest in changing the feeling of virtual shopping, so you get a feel for the product and brand before buying.
Amazon has already made a few changes in the Brand Registry, not in features yet, but the way it looks and the application. I believe by 2021 there’s going to be more exclusive features. Since Amazon aims to get more luxury brands, I believe it is going to include some features that would allow the seller to sell a particular product only to a specific type of shopper. So not everybody will be able to get access to the product or order the product.
Amazon has had constant growth over the years, I believe that Covid was a major contributor to this year’s growth, however more and more businesses are moving online and more people are preferring online shopping compared to in-store shopping. With the personalized virtual shopping experience, I believe Amazon will reach a higher growth in 2021.
– Blenda Luta – BellaVix Marketplace Specialist
COVID-19 has changed online shopping forever, more and more people are comfortable shopping online, I believe Amazon will expand to other countries, not just Europe and North America. Sellers everywhere should start thinking about expanding their business and going abroad.
Users are now buying essential products, such as food and beverages, cosmetics and medicines on Amazon, I believe Amazon will promote more marketplaces like Wholefood and Amazon Fresh with tools like videos, social media, and even influencers.
– Catalina Santana – BellaVix Marketplace Specialist
The Covid-19 pandemic came as a blessing in disguise for Amazon. It enabled them to focus more on the technological aspect of things. The company was able to focus more on virtual operations, speedy paperwork, trade-shows and brought the global manufacturers and the buyers together in a more convenient atmosphere online, scrapping the traditional needs of physical inspection of products reducing time and effort thereby.
We all know the increasing focus being paid by Amazon on supporting the small businesses especially in modern times where they have suffered due to the pandemic. 2021 might see Amazon empower thousands of small businesses by giving them the spotlight on the Amazon Website’s Homepage, making it easier for them to connect with potential buyers around the world. The SMBs would finally be able to get rid of the concept of having a physical presence in the USA, as the website has the feature of selling globally with a local business presence.
I have seen some of my friends sending their Handicrafts to Amazon.com, Amazon.co.uk, and amazon.com.au with the help of Amazon. Global selling feature without any hassle and in limited quantity.
– Sanjeet Singh – BellaVix Marketplace Specialist
Amazon’s sales will continue to increase because shoppers were pushed to buy online due to Covid. Prior to covid, retailers only accounted for 12% of sales. In Q3 of 2020, 70% of U.S. consumers shopped on Amazon. The biggest increase in online sales ever. 48% of U.S. shoppers said they would be ok not shopping at a physical location again. Shoppers are really enjoying the convenience factor of online shopping.
Peer reviews will supersede brand loyalty. Since many people filter by reviews online and they trust their peers to not steer them wrong, brand loyalty may be a thing of the past. Many new brands are emerging on the platform and growing their sales based on their great star ratings.
Amazon Posts will become more like social media with likes and comments. Amazon Posts is Amazon’s attempt to feels like Instagram and Facebook. Sellers can curate the images they share and has a look like Instagram, but I can see Amazon improving the featuring by allowing for likes, comments, and shares.
– Ivonne Haire – BellaVix Co-Founder
Improvements in tracking and sharing data with external sources are something Amazon recognizes as a gap in the platform for marketers and advertisers. Amazon has been slowly improving these features by incorporating Universal Tags inside the storefront to track ads’ performance to a store page. They also rolled out Amazon Attribution, which allows us to track performance from Off Amazon sources to a product detail page. I’m expecting to see further advancement in the sense of our ability to add Facebook or Google Pixels/Tags to the backend of Amazon Attribution to share performance data to the different networks. This will allow the other platforms to optimize ads based on performance and more transparency on performance on the platform.
With COVID-19 shaking up supply chains and eCommerce, it’s no surprise that even some of the biggest companies are having pains with fulfillment. I’m expecting significant investment by Amazon in its fulfillment centers. This is obviously a high priority issue as Amazon recently named Dave Clark as Jeff Wilke’s replacement as Vice President of Retail Operations and the likely predecessor of Jeff Bezos when he decides to leave the job. Dave Clarke is the mastermind behind Amazon’s current logistics network. I’m expecting shipping quantities and inventory limits to be lifted in Q1. As vaccines become more widely available, I foresee warehouses and fulfillment centers operating back at capacity. The end customer will start to see Prime Shipping, 1-Day Shipping, and Same Day shipping available and meeting customer expectations.
– Will Haire – BellaVix CEO & Founder