eCommerce: Amazon Market Analysis

Top Competitors of Amazon in the UK: Key Insights

• The eCommerce market in the United Kingdom is among the top five online shopping markets worldwide.

• Amazon maintains dominance in the global eCommerce market, with a significantly higher GMV than its competitors in the UK, such as eBay, Tmall, Etsy, and Wayfair.

• While eBay consistently holds the second position, it faces challenges in keeping up with Amazon's growth.

• Alibaba Group's Tmall, despite generating a significant portion of revenue in the Chinese market (94.5%), has a growing presence in the UK.

• Implementation of special events like Prime Days and Black Friday significantly contributes to Amazon’s success by increasing sales volumes.

Launched back in 2000, Amazon has established dominance in global eCommerce over the years, with a current gross merchandise value of US$696 billion (2022). According to our data, the UK is the 4th largest market for online shopping with a projected revenue of $166.7 billion by 2023, while Amazon stands with 8.6% of its share in UK as an undisputed giant, outperforming its competitors, like eBay and Etsy.

How does the US giant manage to be so far ahead of its competition? Which competitor should Amazon be most concerned about? Join us as we uncover all answers to these questions.

Top 5 Marketplaces in the UK: Who Are Amazon's Biggest Competitors?

One reason why the competition trails so far behind could be the selection of diverse products across a multitude of categories that Amazon offers. There's no category in which the U.S. giant doesn't lead in this UK eCommerce market. Besides product selection, the competitors differ in services, like delivery time, payment method, and response to customer expectations, whereby artificial intelligence (AI) plays a growing role.

In addition, Statista’s 2023 Consumer Insights uncovered a preference of UK consumers for marketplace loyalty, whereby one third prefer to buy online from various sellers on a single platform. A satisfactory experience for the customer can be decisive in ensuring long-term customer retention.

Geopolitical changes, such as the war in Ukraine and now the escalation between Israel and Gaza, as well as the partially associated economic changes, have an impact on these marketplaces too – whether positive or negative.

In order to gain a deeper understanding, you will find below a detailed overview of Amazon's biggest opponents in the United Kingdom for 2022, ranked according to their Gross Merchandise Volume (GMV) in 2022:

1. Amazon leads in terms of GMV (US$59.5 billion) in the eCommerce, with an annual growth rate of 6% and special focus on the category Electronics & Media (49,7%).

2. eBay follows with the second-highest GMV (US$10.8 billion), despite a major decrease in growth of 15.3%. The U.S. enterprise concentrates on Toys, Hobby & DIY (30.2%).

3. Etsy ranks third (US$1.2 billion). The U.S. business has its main category in Furniture & Appliance (38%) and recorded a decline in annual growth (-3.7%).

4. Tmall (US$1.1 billion) places fourth, with a stable growth rate of 0.3 % and is specialized in Fashion (44.6%).

5. Wayfair holds the fifth position (US$0.9 billion) with a similar annual growth development as eBay (-11.4%) and concentrates, as well as Etsy, on the category Furniture & Appliances (89%).

For more data and specific information, join ECDB.

Despite Losses, eBay Remains the Biggest Rival

Competitors such as eBay, Etsy, and Wayfair are having a hard time keeping up with the marketplace giant and additionally have seen growth losses between 2021 and 2022. Reasons for the decline in growth could include the conflict in Ukraine, along with inflation, to which each firm reacts individually.

The gap between the two rivals is widening as eBay shrinks and Amazon grows, both in terms of annual growth.

eBay has made its entry into ecommerce as one of the first and biggest C2C marketplaces. Back in 2019 eBay's GMV has been stagnating, however, due to the global pandemic, but its GMV increased again in 2020.

Like many eCommerce enterprises, eBay has benefited from the COVID-19 pandemic, and, despite a post-pandemic downward trend of the U.S. marketplace, eBay stays a significant rival for Amazon, in the UK as well as in the international arena.

Alibaba Group Entered the UK’s Online Market

U.S. eCommerce businesses are struggling with losses in the UK, while – besides Amazon – a subsidiary of the Chinese multinational technology company, Alibaba Group Holding Ltd, is in the black with its online marketplace Tmall. The Chinese eCommerce player generates 94.5% of its revenue in the Chinese market, while continuously expanding its presence internationally, including in the United Kingdom.

As opposite to AliExpress, Tmall follows the strategy of selling European products to Chinese consumers and is currently working on their technique for success on the European eCommerce market.

The last few years have shown that the Alibaba Group is a competitor that should not be underestimated, on a global as well as on a national level. Consequently, it will be exciting to observe the further development of Tmall, particularly since the current CEO of the Alibaba Group, Eddie Wu, restructured the conglomerate by splitting the business into six units.

UK’s Biggest Marketplaces for Consumer Electronics

As mentioned earlier, Amazon covers a multitude of eCommerce categories, with a special focus on Electronics and Media (49.7%). Consistent with the company's outstanding position, Amazon is the primary marketplace for consumer electronics in the UK, as seen below.

The Chart confirms: Amazon is leading the market with its GMV of US$17.8 billion in 2022. As in the general comparison, eBay (US$1.5 billion) is here too in second place, while the difference between the two largest marketplaces appears even wider. The disparity in distance underlines Amazon’s dominance.

Tmall performs weaker with US$78.9 million, but still manages to remain among the top five. In addition, another company from the Alibaba Group – AliExpress – is in third place with a GMV of US$165 million, closely followed by the refurbished French business Back Market (US$128.1 million).

UK’s Biggest Marketplaces for Fashion

There are also categories in which Amazon performs less well, providing the competition with avenues for attack, such as the fashion segment.

Amazon generates a share of 6.7% of its global GMV from fashion sales in the UK, rendering it the smallest covered product category among our five classifications. For comparison, eBay has 26.3% in this regard, which makes a significant difference. The chart below illustrates how close eBay is to Amazon in the UK fashion sector.

Although eBay's main share lies in the Toys, Hobby & DIY segment (30.2%), it performs remarkably well in the fashion category. The difference between Amazon and eBay is now only $1.2 billion, which is approximately 40% of eBay's GMV. For comparison, in the Consumer Electronics category, the variation between the two rivals is US$16.3 billion, equal to eleven times eBay's GMV in the fashion classification.

Looking at the other three marketplaces, it becomes apparent that fashion is a strong category for them too. Tmall, Vinted, and Etsy generate higher GMVs in fashion than in electronics, as seen above. Tmall, secures the third position here with US$501.7 million, closely followed by Vinted, the second-hand company from Lithuania.

Vinted has managed to generate significant growth of 43.3% between 2021 and 2022, earning its place among the top five.

Etsy, the third-strongest marketplace in the UK, completes the top five with US$381.1 million.

Overall, it's noticeable that the rankings primarily feature U.S. businesses, along with Chinese companies, mainly from the Alibaba Group. UK companies tend to rank lower, while occasionally European companies like Back Market or Vinted make it into the top five.

Prime Days, Black Friday, Cyber Monday – How Does Amazon Attract Costumers

To sustain one's growth in times of inflation and conflicts, it is crucial to promote purchasing incentives. Amazon achieves this by implementing special events such as Prime Days 2023 (11th-12th July and 10th-11th October 2023) and Black Friday (17th-27th November 2023).

Although Amazon typically does not release exact sales figures of the Prime Day, Adobe has estimated the sales figure Amazon generated on its Prime Day in July 2023. According to their analysis, Amazon is estimated to have reached a sales volume of US$19.2 billion in 2022, US$12.7 billion of which in the United States.

It is evident how such special events significantly contribute to Amazon's success by ultimately increasing sales and profitability.

Black Week encourages people to make purchases on all retail platforms, not just Amazon. A growing number of sellers, whether online or offline, try to capitalize on this shopping day. Particularly in regions where Christmas is celebrated, this week provides affordable opportunities to purchase Christmas gifts for family and friends.

Top Amazon Competitors in the UK: Closing Thoughts

A closer inspection of two popular categories for eCommerce, consumer electronics and fashion, confirms Amazon’s dominance in the UK but also reveals different dynamics. While it is clear that Amazon is the leading marketplace by GMV globally and in the UK, it excels in its main category of consumer electronics. Although it is also the most popular marketplace for fashion, other platforms generate comparably high GMVs, notably eBay.