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Marketplaces

Amazon Australia and Online Marketplaces [Statistics]

The launch of Amazon Australia has sent a ripple of excitement through the retail industry, with big changes expected to follow.

In light of this, we conducted a survey of all Neto merchants to take a temperature check on sentiment towards Amazon, and to understand more broadly how (or if) marketplaces like Amazon, eBay, Catch of the Day and TradeMe fit into our retailers’ business strategies.

And the results were overwhelmingly positive - marketplaces will be where it’s at in 2018. Here’s some of the key findings.

95% of Retailers Intend to Sell on Amazon in 2018

No '95' isn’t a typo. The results from our survey of more than 200 retailers revealed that 95% of retailers intend to sell on Amazon in 2018. And a further 39% of retailers said they will sell in as many marketplaces as possible in 2018.

Neto Marketplaces Survey
Marketplaces merchants intend to sell on in 2018

So it’s clear that retailers believe incorporating marketplaces into their strategy for 2018 is a must, but why? Here's what retailers said:

  • To bring in new customers
  • To build brand awareness
  • Business expansion
  • To allow them to sell more
  • Exposure to new markets

One respondent claimed that marketplaces are the most important selling platform for their business: “Marketplaces are key to our business growth - they allow us to sell to a broader audience without the huge marketing budgets to direct traffic onto our website.”

| Related Reading: How to Sell on Amazon Australia and Other Amazon FAQs

Over Half of Retail Sales Comes Through Marketplaces

For those trading on marketplaces prior to the launch of Amazon Australia, a huge 52% of sales, on average, came through marketplace channels including eBay, Google Shopping and Catch of the Day.

Neto Marketplaces Survey-what marketplaces do retailers sell on 2017
Marketplaces retailers traded on prior to the Amazon Australia launch

Neto merchant and marketplace veteran, Cycling Deal, has been selling bicycle parts and accessories since 2005 in Australia and around the world, and reportedly sells twice as much on Amazon US as every other channel combined.

Nick Gu from Cycling Deal
Cycling Deal sells twice as much on Amazon US than other channels.

Founder, Nick Gu, says that in the US market 90% of his sales come from the Amazon US marketplace, behind eBay and Walmart, and that Amazon Australia’s launch is a massive opportunity:

“I’m at a stage now where most of my business is automated, and thanks to Amazon bringing in so many sales, the money makes itself. As long as retailers are prepared to embrace the change and play by the rules, this is a chance to earn big.”

| Read the Case Study: Cycling Deal CEO Shares His Secrets to Success on Amazon US in the Wake of Amazon Australia’s Launch

Shoppers Love Marketplaces Too

These findings come after the Neto State of Ecommerce Report, released just last month, found that shoppers are also turning to marketplaces, with 39% of shoppers surveyed using marketplaces as their primary channel to buy online.

Neto CEO and Founder, Ryan Murtagh, who recently gave a talk at Australian Parliament on the future of retail, says that this shift is not surprising given the quality of customer experience and high level of trust consumers have in marketplaces like Amazon:

“Ease and convenience remain the top priorities for consumers’ shopping experiences, and consequently so does an efficient fulfilment, shipping and returns process.”

Marketplaces Expected to Make up Large Portion of Total Sales

Of the merchants who plan to trade on marketplaces in 2018, 18% predicted that 75% of their total sales will come from marketplaces, and 54% of respondents expect marketplaces will make up 5-25% of sales.

Neto Marketplaces Survey-expected sales from marketplaces
Percentage of sales expected to come through marketplaces in 2018.

But Murtagh advises to have a solid plan around the technology and systems you will use to manage the back end of your business:

“Navigating the complexities that come with selling on marketplaces like orders coming in from different sources, managing multiple sets of inventory, and shipping as per marketplace requirements will be the defining factor for many businesses entering into this realm.”

And navigating these complexities will be a whole lot easier with the right technology. Murtagh says:

“Regardless of one’s intention to leverage channels like Amazon, retailers need to invest early in technology that enables them to seamlessly surface their inventory wherever their customers are. Retailers stuck in legacy systems that are not sales channel agnostic, will find it increasingly hard to adapt quickly and compete both locally and abroad. It is therefore our responsibility to ensure that services like Neto are accessible, affordable and ready for whatever the next Amazon is.”

Neto have been helping thousands of retailers sell via eBay, web and physical stores for over 8 years, and launched their Amazon Australia integration on the same day that the marketplace officially landed in Australia. The Neto Amazon integration provides retailers with an easy way to manage listings, inventory, and sales for Amazon orders from the one central platform.

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