eCommerce: Marketplace Insights - Amazon

Amazon GMV: Key Insights

• High GMV: The gross merchandise volume of transactions on Amazon's online marketplaces serves as an indicator of how much activity its domains manage globally.

• Amazon.com on Top: The .com domain stands out as the highest grossing one. It accounts for 52% of the total GMV generated by all 22 Amazon domains.

• Best Domains: As Amazon continues to expand its global network, some of the newer domains are growing rapidly, while others benefit from investments in infrastructure and customer retention strategies.

Amazon serves different markets and regional preferences with its 22 domains. It also takes advantage of its unique position to access first-party data from its marketplace business.

A crucial metric to assess marketplace performance is GMV (gross merchandise value). Here's a look at how Amazon's domains stack up in terms of GMV.

What is GMV and How is It Calculated?

The gross merchandise value describes the total value of transactions generated on an online marketplace before discounts, advertising, and delivery. GMV thus calculates how much commerce has taken place on a platform and can be seen as a measure of business activity. 

GMV = Selling Price of Goods x Number of Goods Sold

It is important to understand that GMV is not the same as the revenue generated by a marketplace operator. Instead, providers deduct a fee for each transaction made on the platform, which is how they make a profit. 

But how much do specific domains contribute to Amazon's overall GMV?

Amazon Generated US$729 Billion in GMV Across All 22 Domains in 2023

Amazon's revenue streams are multifaceted and include transaction fees from its marketplace platform, sales of its own products as a retailer, and contributions from its extensive network. That includes cloud services, retail advertising markets, and subscription services for streaming as well as for faster delivery. 

While GMV does not reflect Amazon’s total profit from its role as a marketplace operator, the size of the transactions that take place in a given period helps us illustrate the traffic that this platform manages.  

Overall, Amazon’s marketplaces generated a total GMV of around US$728.8 billion in 2023, which includes transactions on all 22 domains Amazon operates around the world. A breakdown shows that amazon.com remains the most used domain, with a GMV of US$375.1 billion in 2023, representing 52% of Amazon's global GMV.

Among the remaining top four domains, amazon.co.jp ranks second with a GMV of US$68 billion, accounting for 9% of the total figure. Amazon.co.uk and amazon.de have similar GMVs of US$62.9 billion and US$61.1 billion, representing shares of 9% and 8%, respectively. Fifth is amazon.ca with US$30.7 billion, resulting in a 4% share of the company's total GMV.

Other domains collectively generate 17% of Amazon's overall GMV, or US$119.5 billion in absolute terms. As Amazon continues to expand its marketplace into new geographies and markets, the growth of these new ventures has a notable impact on the brand’s overall development. 

Below is a look at the top five Amazon domains with highest GMV growth rates and the factors that contributed to their outstanding performance.

Amazon Belgium Grew the Fastest in 2023

In recent years, Amazon has entered several new markets, including Belgium in late 2022. The Belgian domain ranks first among Amazon's fastest growing markets, increasing by more than 7 times its original value.

That new domains indicate the highest growth rates fits the novelty of their business, as activity spurts after the domain's initial launch.

Australia's and Brazil's Domains Are Not New, But Grow Fast

Amazon’s Australian and Brazilian domains are not particularly new, yet they rank second and third in GMV growth from 2022 to 2023. This is because Amazon has invested heavily in distribution facilities and infrastructure in both markets over the recent years, attracting more customers to the site with the promise of next-day delivery and an extensive product selection.

Barriers to Amazon’s reach in these markets include both intense competition and structural impediments such as insufficient eCommerce penetration and infrastructure. With subsequent investments, Amazon strengthened its position in the markets, inviting more retailers to add their product offerings to the marketplace, and attracting more customers with the promise of greater convenience and choice.

Leveraging Existing Infrastructure in Poland

The Polish domain is one of the newer markets for Amazon, with growth of 31% since 2022.

What facilitated Amazon’s entry into this market is the existing infrastructure, including about 10 fulfillment centers that were already operating in Poland before Amazon launched amazon.pl in 2021. 

Prior to the launch, consumers in Poland had to order their packages from Amazon across borders, mostly through the German domain, which offered the option to navigate and purchase in Polish, but the launch of amazon.pl has now streamlined this process and provides a localized experience tailored to the Polish market.

Amazon Invests in Renewable Energy in Sweden

Amazon.se is active since 2020, but the domain ranks fifth by GMV growth rates in 2023, having increased market activity by 29% since 2022.

Sweden is one of the markets in which Amazon invests in renewable energy projects. One of these is a wind energy investment in Sweden, which Amazon claims is a contributing factor to the domain's success, as it meets widespread consumer demand for ecologically clean business practices.

Amazon GMV Growth: Closing Remarks

Amazon's dominance as a Western retailer is supported by its US$729 billion GMV across all 22 domains in 2023. The moderate growth rates of Amazon's fastest growing domains, which mostly revolve around 35%, call into question the longevity of Amazon's approach.

There are also recent market developments, namely the emergence of low-cost competitors like Temu, which prompt Amazon to choose between low prices and higher quality.

Sources: About Amazon: 1 2 – AFR – Investopedia – Notes from Poland – Valor International

GMV on Amazon: FAQs

What is GMV on Amazon?

Gross merchandise volume (GMV) on Amazon refers to the total value of all sales made through the Amazon platform over a certain time period. This includes the price paid for goods by consumers before any deductions for fees, discounts, or returns. GMV is a significant metric in eCommerce as it helps in understanding the scale of transactions and the marketplace's health and growth.

What companies have the highest GMV?

Companies with the highest GMV are typically large eCommerce platforms. As of 2023, Amazon ranks highly, given its extensive global presence and diverse product range. Alibaba Group holds one of the top spots, primarily due to its massive sales during events like Singles' Day. Other notable companies include mainly Chinese online platforms, each commanding significant shares in the global eCommerce market.

What is the largest eCommerce platform by GMV?

Based on the latest ECDB data, Amazon is recognized as the largest eCommerce platform by Gross Merchandise Volume (GMV), with a reported GMV of approximately US$730 billion.

Is GMV same as revenue?

No, GMV is not the same as revenue. Gross merchandise volume measures the total value of transactions on a platform, while revenue is the actual income a company earns from its core operations.

Does Amazon report GMV?

Certainly. Amazon does report GMV, which is an important metric for understanding the scale and activity on its platform. However, it's important to note that Amazon may not disclose GMV in its financial statements but may provide this information in other reports or presentations to investors and analysts for a more comprehensive view of its business performance.

What is the difference between total sales and GMV?

The difference between total sales and GMV is that total sales represent the actual revenue a company earns from its core operations, while GMV includes the total value of all transactions on a platform, encompassing fees, taxes, and shipping costs. GMV is a broader measure of economic activity, whereas total sales focus solely on a company's income from its primary business activities.