[Amazon Q4 Earnings] Ecommerce revenue slows, but advertising is booming

Amazon’s Q4 earnings report shows a 9% YoY increase in terms of overall revenue. However, it also reveals that despite launching a second Prime Day last year, e-commerce revenue growth was sluggish. In addition, the one area Amazon did extremely well shows the level of competition 3P sellers are facing.

Amazon Top Terms

Discover which terms jumped the ranks on Amazon from January 15 to January 28.

Famous people and influencers have a huge impact on consumers' shopping habits and preferences. Their endorsements, advertisements, and personal choices can greatly influence what products we buy and how often we buy them. 

In this week’s top 10 terms, “tepezcohuite cream” takes slot #1. Thanks to Salma Hayek's endorsement, some Amazon products related to this keyword led to a significant increase in sales, reaching up to 167 units per day.

This highlights the power of celebrity influence in driving consumer behavior and shaping our perception of products and companies are utilizing this trend to market their products and drive sales.

Dark Pattern Design

Amazon is facing yet another lawsuit in a foreign country for questionable practices. This time, it’s from Poland.

The Office of Competition and Consumer Protection (UOKiK), a consumer watchdog, accused Amazon of misleading customers about delivery times. UOKiK pointed out that Amazon indicates a delivery date only to be later on changed without prior notification to the buyer.

This is done through dark pattern design, i.e., designs that deliberately obscure and mislead readers into making unintended choices. Admittedly, Amazon discloses that it does not treat the placing of an order as a sales contract. Instead, the binding sales contract is executed at the moment of the order’s shipment.

However, customers need to be very observant because Amazon uses “a gray font on a white background and placing it at the very bottom of the page, which may require you to scroll down the screen.” In contrast, the “Buy Now” and “Proceed to Checkout” buttons are displayed in bright colors.

Shopify Merchants Aren’t Going Anywhere

Despite the 33% increase in seller fees, analysts are confident the platform wouldn’t have to worry about losing its sellers. This is partly because they believe Shopify offers much better features and value than most of its competitors.

The company also promises to continue improving its services. Recently, Shopify announced a native OpenAI integration into Shopify Flow. This helps sellers eliminate some of the routine tasks of running their Shopify stores. For example, it can help generate comma-separated product tags.

This is why despite the significant increase, Shopify’s stock is seeing surges after the announcement.

Etc.

No returns for custom products. Starting February 15, 2023, personalized products sold on Amazon will no longer be eligible for returns.

Walmart expands drone delivery program. Walmart made around 6,000 drone deliveries in 2022. It continues to expand its services, with recent additions in Lindon and Herriman.

More Amazon layoffs. A spreadsheet made by an Amazon employee reveals layoffs hit the company’s robotics, grocery, health and AWS divisions.