Background: Amazon is the Seattle-based retail giant that sells... basically everything. You can get anything from luxury mattresses... to 2.5kg tubs of Vegemite.... to BBQ tongs designed specifically for a Bunnings snag. It has become one of the dominant online shopping platforms in Australia, thanks to its massive product range and next-day delivery.

What happened: Over the past year, Amazon's marketplace sales in Australia grew 20% last year, hitting over $2.3 billion. But here's the twist: that only accounts for around half of its total Australian revenue. In fact, Amazon is now making more from advertising, subscriptions, and merchant fees than it is from actually selling products online.

What else: Fees from third-party merchants selling their products on Amazon made them over $1.1 billion.
And with the convenience of next-day delivery, it’s no surprise that Amazon has taken the mantle as Australia’s top online shopping platform.

What's the key learning?

💡 Amazon is selling convenience... and Aussie shoppers are clearly buying in. In fact, 8 times out of 10, Amazon wasn't the cheapest retailer for a particular item, but Australians bought it there anyway because they could get it faster.
 

💡 That's because convenience now has a price tag globally. Consumers globally are increasingly willing to pay a premium for getting what they want, when they want it. They'll spend around 5% more on average just to get products faster.

💡Which is exactly why Amazon invested $35 billion into Australian operations. The faster the delivery, the more customers spend... and the more merchants pay to reach them.