The Great Amazon Takeover: the top 3 industries ripe for disruption from the tech giant

Amazon is one of the most prolific and valuable public companies on the planet, having transformed from an online book retailer into a global phenomenon, now spanning several different sectors.

The last few years have seen the company expanding into several markets, from launching its brick-and-mortar grocery chain Amazon Fresh, to its physical clothing store Amazon Style and the launch of health and wellbeing operation Amazon Pharmacy, following on from its 2018 acquisition of US pharmacy PillPack.

As Jeff Bezos once famously said, “Your margin is my opportunity.”

The tech giant is constantly expanding, as it looks to develop to its ever-growing empire. Here are three further industries that are ripe for Amazon to disrupt even further:

Amazon Handmade: handmade or vintage items

Back in 2015, Amazon launched Handmade, an online destination for unique, handcrafted pieces created by local merchants around the world.

Since launching, the site has seen an increase in product selection and a 7.5x increase in the number of sellers, who come from over 80 countries.

Amazon launches Etsy competitor Handmade at Amazon - The Verge

To sell on Handmade, Amazon requires merchants to sign up for a seller account, which costs $39.99 per month, in addition to fees. Once Amazon approves the application, the merchant will no longer have to pay the monthly fee — only a 15% fee for every sale.

Etsy is undoubtedly Handmade’s chief competitor, with its number of sellers continuing to grow steadily over the years. In fact, the ecommerce boom in 2020 saw its number of sellers reach 4.3m, an increase from 2.7m the previous year.

However, Etsy has faced a number of recent controversies that could leave Handmade in a prime position to dominate the market.

The company recently proposed a fee hike, raising the platform’s transaction fee from 5% to 6.5% per order. The move saw thousands of Etsy sellers go on strike, calling the price increase “unbearable” and “ridiculous”.

While Handmade offers less categories than Etsy, sellers can benefit from the large consumer base Amazon offers, as well as its fulfilment service.

If sellers are able to ship every business day, they can apply for Seller-Fulfilled Prime. The programme enables products to have a Prime banner on them, which means they are more likely to be purchased.

In fact, according to Amazon statistics, many sellers experience a 50% increase in sales with the Prime banner.

Considering Etsy’s recent struggles, Amazon Handmade is likely to expand, attract more sellers and dominate a larger share of the market.

Amazon Games: Gaming and video games

According to CB Insights, video games represent a $211b market. Amazon has already made its first foray into the space through acquisitions and launching a gaming subscription service.

In 2014, the ecommerce giant acquired video game live streaming platform Twitch for $970M. At the time, the platform had approximately 55m visitors per month. However, by 2020, it had 30m daily visitors who engage with over 7m streams.

Twitch now hosts 91% of all streamed content, making Amazon a clear leader in the space.

Amazon Luna: Price, game list, and more (March 2022) - Android Authority

In addition, cloud-based subscription gaming service Luna was also launched by Amazon in September 2020. A variety of games are offered to users for a monthly fee of $5.99. However, the platform is still in the early access phase, so users who sign up must wait for Amazon to grant them access to the Luna.

Amazon Game Studios also released its “New World” game back in October 2021. The game saw over 700,000 concurrent players, making it one of Steam’s biggest ever launches.

While gaming is not yet the revenue driver of Amazon’s Prime subscription or cloud service, it can directly make the company money, unlike Amazon Studios, which is primarily used to keep people subscribed to Prime.

With its current investments in the space, it is very likely Amazon is planning on further expanding and developing its gaming offering.

Amazon Smart: smart home items

The smart home market is growing and the number of appliances in the US is expected to more than double, reaching 64m by 2025.

The company launched its first iconic smart home product, the Amazon Echo smart speaker back in 2014.

Since this launch, many rivals including Google Home and Sonos have released similar products. However, Amazon has still maintained a 69% market share of the smart speaker market.

Everything Amazon just announced for your smart home

Connected devices, from lighting, heating and kitchen appliances are growing in popularity. Amazon has been releasing branded smart devices that incorporate the Alexa voice assistant features, including clocks and microwaves.

Using the Alexa technology as a foundation, Amazon is in a strong position to launch further devices and capitalise on the ever-growing market.

In 2018, the company also partnered with US home construction company Lennar, which offers built-in smart home capabilities built by Alex, that range from thermostats to doorbells.

Further acquisitions include doorbell and smart camera company Blink for $90m in 2017, connected doorbell Ring for $1bn in 2018 and Wi-Fi mesh network Eero in 2019.

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