Amazon.com Inc. accounted for 44% of U.S. e-commerce sales in 2017, according to a new estimate by retail analytics firm One Click Retail.
That amounts to roughly $200 billion in e-commerce sales, and about 4% of total U.S. retail sales, according to the vendor. One Click Retail estimates online sales figures using a combination of website indexing, machine learning and proprietary software.
Globally, Internet Retailer estimates that consumers spent $310.0 billion on Amazon in 2017. One Click Retail does not have a 2016 estimate of Amazon’s share of U.S. e-commerce sales. Slice Intelligence, however, estimated last year that Amazon accounted for 43% of all U.S. online retail purchases in 2016, just a percentage point lower than 2017.
According to One Click Retail, consumer electronics was the top-selling product category on Amazon in the U.S. in 2017 with an estimated $8.5 billion in sales, followed by home & kitchen ($5.5 billion), publishing ($5 billion) and sports & outdoor ($4 billion). Combined, these leading categories generated more than $23 billion in sales on Amazon in 2017, One Click Retail says.
The product categories that grew the most year over were:
There are several factors driving Amazon’s growth, says One Click Retail, including its increasingly sophisticated marketing program that is helping marketplace sellers boost sales on Amazon’s platform, the growth of its private-label brands and consumable products, as well as millennial shoppers, a key Amazon constituency, getting older and having more disposable income to spend online.
In the first half of 2017, sales of consumable products—such as grocery, beauty, pet, health and personal care products—were up 35% year over year, according to One Click. This growth accelerated in August when Amazon closed its acquisition of grocery chain Whole Foods for $13.7 billion. In the few months of the year when Whole Foods products were available on Amazon.com—2,000 products were added in mid-September—Whole Food’s “365 Everyday Value” brand raked in $10 million in 2017 sales for Amazon, according to One Click Retail.
Amazon’s private-label brands across many categories had a big year, including the retailer’s largest brand, AmazonBasics, which One Click Retail estimates generated $400 million in sales this year.
Millennials, or consumers 20 to 36 years old, are avid Amazon shoppers who are entering their big-spending years of owning homes and raising children. Internet Retailer estimates that 34.3% of consumers who bought something on Amazon in 2016 were 34 years old or younger, according to Internet Retailer’s Top500Guide.com.
One Click Retail estimates that millennials were the driving force behind Amazon’s 33% year-over-year furniture sales increase and that they contributed “the bulk” of the estimated $5.5 billion in home and kitchen sales, which is a 20% year-over-year increase.
In addition, Amazon in 2017 increased its marketing sophistication. For example, the e-commerce giant now allows brands to bid on a broader range of keywords; target shoppers based on whether they are on Amazon using a desktop, the mobile web or its app; and integrates with email marketing campaigns, according to One Click Retail. About 27.6% of retail marketers advertise on Amazon, according to Internet Retailer’s 2017 Digital Marketing Survey.