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In 2023, the cross-border world is in turmoil. Facing the strong impact of China's four overseas dragons, Amazon still maintains its position as the e-commerce overlord. It is learned that on February 1, local time, Amazon released its fourth quarter and full-year financial report for fiscal year 2023. The financial report shows that in 2023, Amazon achieved net sales of US$574.8 billion, a year-on-year increase of 12% ; net profit was US$30.4 billion , successfully reversing the decline of US$2.7 billion in net loss in 2022, and profitability was significantly enhanced. Among them, in the fourth quarter of 2023, Amazon achieved net sales of US$169.961 billion, a year-on-year increase of 14%; net profit reached US$10.624 billion, a more than 37-fold increase from US$278 million in the same period last year, both higher than market expectations. As for the reasons for the sharp increase in performance, Amazon pointed out in its financial report that it was mainly due to the strategy of cutting costs, improving delivery efficiency and further penetrating the advertising market. It is learned that since 2022, when Amazon suffered losses due to overcapacity caused by excessive expansion, it has been focusing on reducing costs and increasing efficiency: on the one hand, it has reduced its scale through large-scale layoffs and cuts on marginal businesses, and on the other hand, it has improved logistics construction and improved delivery efficiency. And it turns out that these measures are indeed quite effective in improving Amazon's performance. In addition, as market competition becomes increasingly fierce, third-party sellers and brands are increasing their advertising spending to increase their competitive weight. Therefore, Amazon's performance in digital advertising is also very good: the financial report shows that Amazon's advertising revenue in the fourth quarter increased by 27% year-on-year to US$14.6 billion. Looking ahead, Amazon expects revenue in the first quarter of 2024 to be between $8 billion and $12 billion, with sales in the range of $138 billion to $143.5 billion. Compared with Amazon's stable and expected positive performance, the sellers on this platform have their ups and downs. Due to losses in store operations last year, some sellers are considering "escaping" from Amazon at the beginning of 2024. It is learned that recently, a seller broke the news that a Shenzhen cross-border enterprise issued a store closure notice in the company group: due to the continuous closure of multiple Amazon stores , the company's capital chain was broken, operating difficulties, and the downward trend was difficult to reverse. After careful consideration, the company decided to officially suspend operations on January 31, 2024. ▲ The picture comes from the seller’s disclosure As soon as this news came out, it resonated with many sellers: "Our company was also shut down at the end of September last year. We took the brand route and followed the rules honestly, but we were still shut down." "I don't know when my account will be blocked when I work for Amazon. It's so insecure." “No more Amazon this year…” Based on the feedback from sellers, most of them have failed to adapt to changes in platform policies and have been deeply affected by rising operating costs , resulting in losses in store performance, which has led to the desire to "leave Amazon". However, most sellers have not put this into practice and are still waiting and watching. At the same time, some sellers decided to stick with Amazon as they remain optimistic about its development in 2024. Survey data shows that although many new e-commerce companies have emerged in 2023, 73% of sellers still intend to deploy on Amazon for their platform planning in 2024. There are also many sellers who say they are "still optimistic about Amazon" on forums and major social platforms. Some sellers said that despite facing competition and challenges, in horizontal comparison, Amazon is still the most promising platform, and the huge scale accumulated over the years will be difficult to shake in the short term; other sellers have observed that according to Amazon’s latest Q4 2023 financial report, Amazon’s third-party sellers’ revenue reached US$43.5 billion, a year-on-year increase of 20%, and still has growth potential. We also learned that after the wave of account bans in 2021, there was a wave of sentiment to "leave Amazon" in the cross-border circle, but since 2022, according to data from Marketplace Pulse, the number of new sellers entering the Amazon platform each year will still increase by a certain percentage , even in product categories dominated by old sellers. This means that despite the sluggish market environment and increasingly fierce competition, Amazon has not seen a large number of sellers fleeing the market. In fact, the number of new sellers entering the market is still increasing. However, it is worth noting that in recent years, the Amazon market has turned into a red ocean amid fierce competition, and it is an established fact that platform supervision has been tightened and operating costs have increased. A senior seller admitted: In the future, Amazon's demand for funds may become more stringent, which will no longer be suitable for small sellers to enter the market, but will test the sellers' supply chain capabilities more. Faced with a platform ecosystem where the strong prey on the weak, if sellers want to avoid being eliminated, they can only build their own core competitiveness while adapting to the platform's survival rules. What do you think about this? Welcome to discuss in the comment area~
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