Amazon Marketplaces : Where should you start selling?

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The ultimate goal for most Amazon sellers is to make their brand international. It is most often a fantasy that seldom becomes a reality. This is because a few of the Amazon sellers aren’t able to choose the right marketplace for their brands. In this blog, we’re going to walk through different Amazon marketplaces and look at how to choose the right marketplace that does wonders for your brand.

To successfully sell your products internationally, you must first decide where to sell them.

Once you’ve decided on what product you want to sell, you need to select the right marketplace that is profitable for your business. Amazon operates  online stores worldwide allowing you to grow your business internationally.

      • United States
      • Canada
      • Mexico
      • United Kingdom
      • Germany
      • France
      • Italy
      • Spain
      • Japan
      • Singapore
      • United Arab Emirates
      • Brazil
      • Australia
      • India
      • Netherlands
      • Saudi Arabia
      • Turkey
      • Sweden
      • Poland

Amazon China is no longer operational since July 2019. Both Poland and Sweden are newly established Amazon Marketplaces. Poland was introduced in 2021 while Sweden Amazon Marketplace was established in 2020.

To decide which Amazon Marketplace to sell your products in, you must analyze each factor that would show a significant impact on your sales. We will look at each factor that has to be considered to make it easier to choose from the above list of Amazon Marketplaces.

Demand:

The first factor that plays a major role in bringing you sales is demand. There is no use in selecting a marketplace that is less competitive and that has no other sellers if there are no buyers that are willing to purchase your product. The more traffic you get more is the number of product visits you get in that specific marketplace.

In terms of traffic, Amazon USA that is amazon.com generates around half of the international traffic. What is more surprising is that Japan is the second most heavy traffic marketplace. More traffic means more views, and more views mean more people are willing to buy your product.

If there is a high traffic, you can upgrade or brand your product to stay a step ahead in this competition.

GDP PPP per capita:

However, does mere observation of traffic ensure better sales? Mexico has relatively higher traffic than Singapore. Suppose 100 people are viewing your product both in Singapore and Mexico. Does that mean an equal generation of sales in both countries? Not necessarily. We are going to compare this using an economic metric called GDP PPP per capita. PPP GDP is gross domestic product that is converted to international dollars using purchasing power parity rates.This can be explained more thoroughly as the average amount a person is earning in that country.

It is quite obvious that the more a person is earning, the more he is willing to spend money to buy your products.

Normalized Spending Power:

Normalized Spending Power is usually taken in comparison with the US being 1.00 as everything is compared in dollars.  This metric specifically lies between 0 and 1 with the US being 1.00. This metric makes it easier for sellers to compare the rest marketplaces in terms of the most popular amazon.com

After retrieving the normalized spending power, the normalized demand is calculated by using the formula:

Normalized demand = (traffic)*(normalized spending power)

 

Let us now look at each Amazon marketplace in detail and analyze the pros and cons:

Amazon Marketplaces:

1. Amazon United States – amazon.com

It is the first and the most popular Amazon marketplace in terms of both traffic and seller popularity. Based on a survey, 77% of the Amazon sellers sell in the Amazon US marketplace and about 56% of them live in the US.

Amazon.com USA

 

Merits:

        • Huge demand market of buyers.
        • Fulfillment By Amazon makes it easy to become a national seller.

Demerits:

        • Highly competitive across most of the categories.

Amazon sellers who have had success in selling their brand in other countries and want to reach out a larger audience can start selling in this marketplace.

2. Amazon Canada – amazon.ca

Canada is the second most popular marketplace in terms of both traffic and seller popularity, after the US. The largest portion of Amazon Canada’s sellers are from the US (41%), with only 29% of amazon.ca sellers.

Amazon.ca (Canada)

Merits:

        • Easy to start selling from Amazon USA account.
        • English speaking audience.
        • High exposure and low competition.

Demerits:

        • Low online expenditure.

Sellers on Amazon USA looking to experiment with international selling without increasing investment in logistics and strategies and those who can optimize and market products successfully can enter this marketplace.

3. Amazon UK (amazon.co.uk)

After the United States and Canada, Amazon United Kingdom (amazon.co.uk) is the third most popular Amazon marketplace to sell in. However, it has less than twenty five percent of the sellers Amazon United States has and less traffic than the Amazon Germany marketplace. About 43% of Amazon sellers in the UK marketplace are located in the UK. US based sellers in this marketplace account for 13% of Amazon UK sellers, and 9% are from China.

Amazon.co.uk

Merits:

        • If it works on Amazon US it will probably work on Amazon US
        • Good entry point into European Market
        • English speaking population – No language barrier
        • Slightly less competitive than Amazon United States

Demerits:

        • Fairly competitive and a lot of established sellers.

US sellers looking for another marketplace or a for a launchpad into the Europe market should consider selling in amazon.co.uk.

4. Amazon Mexico – amazon.com.mx

According to a survey, 12% of Amazon Sellers sell in the Amazon Mexico marketplace. On an average, sellers in Amazon Mexico marketplace witness higher monthly sales than the US sellers.

amazon.com.mx

Merits:

        • Easy to start selling from Amazon USA account
        • Low competition

Demerits:

        • Language Barrier – Non-English-speaking population
        • Unique shopping behaviors

Sellers who are already selling in Amazon US and Amazon Canada and are looking to sell in the entire North American region can introduce their brand in this Amazon Marketplace.

Amazon Germany (amazon.de)

 Germany is second only to the US in terms of traffic as it is Amazon’s busiest marketplace. British sellers constitute the largest portion of sellers who sell in the German market (22%), followed by Americans (8%), and Chinese Amazon sellers (18%). Germans only account for about 10% of amazon.de market sellers.

Amazon.de

Merits:

        • Entry into biggest European market
        • Huge number of English speakers
        • Relatively less competition
        • Favorable tax conditions

Demerits:

        • May need help from a German speaker

Amazon Sellers in competitive categories looking to test waters in Europe or sellers willing to invest a little more time into optimizing listings for a foreign language can try selling in this market.

Amazon Japan (amazon.co.jp)

Chinese sellers make up a large portion of sellers in Japan market, accounting for 42% of the sellers. That is followed by the US sellers, who account for 18%.

Amazon.co.jp

Merits:

        • Japanese customers tend to pay more for high quality products.
        • You will face less ‘hijacking’ of private label listings.
        • Less competition yet large audience.

Demerits:

        • Non-English-speaking population – language barrier
        • Unique shopping behaviors

Veteran sellers who have the time and proven strategy required to be successful in this region can try selling in this market.

Amazon Australia (amazon.com.au)

 Amazon Australia has a broad mix of sellers from different countries after it was fully launched in 2017. The Australian Market is made up of: 16% of are American sellers, 25% are Chinese, and 19% are Australian sellers.

amazon.com.au

Merits:

        • New marketplace which means better chance to get in on the ground floor
        • English speaking population – no language barrier
        • This population is used to paying high mark-ups on goods
        • Proximity to Asian supply regions.

Demerits:

        • Small population
        • Difficult geography for logistics

Australian based sellers, strategic sellers who are willing to make the most of the opportunity to get in first with product rankings in this new market, and sellers looking for another English-speaking marketplace can try selling in the Australian market.

Amazon India (amazon.in)

 India is the fourth largest global marketplace in terms of traffic. However, it has one of the lowest seller counts of all the marketplaces. . 78% of sellers surveyed in this marketplace are also located in India.

amazon india: Latest News, Videos and amazon india Photos | Times of India

Merits:

        • Huge traffic
        • Huge number of English speaking people

Demerits:

        • Less normalized spending power

How to decide where to start selling?

Deciding which marketplace to start selling on Amazon is an absolutely pivotal decision that could make or break your business.

Based on the above given factors, let us try to rank the Amazon Marketplaces according to the demand and traffic:

In the above table, traffic is taken in terms of million per month. Identifying the traffic is very important as this gives you an idea of the demand and competition. You would not want to sell your products with no people willing to buy.

Can traffic alone be a good enough metric to decide the marketplace?

Note that just the traffic does not ensure sales. No matter how much traffic you generate, if the audience in a marketplace are not able to afford your product, you cannot generate sales. This is why, we will now rank the Amazon Marketplaces in terms of GDP PPP Per Capita.

Here, Singapore has the highest GDP PPP Per Capita while India, despite its huge traffic doesn’t seem like a good option to consider in terms of GDP PPP Per Capita.

Assuming US=1, we have normalized the GDP PPP Per Capita of all the Amazon Marketplaces to aid comparison. Now, taking into account both traffic and normalized spending power, we will calculate Normalized Demand, using the formula:

Calculate the normalized demand for all the marketplaces you are considering. Rank them from best to worst depending on the normalized demand and GDP PPP per capita.

According to the Normalized Spending Power, Amazon marketplaces are categorized into four tiers.

  • The USA is tier 1.
  • Japan, Germany, UK fall under tier 2 while France, Italy, Canada, and Spain come under tier 3.
  • India, Australia, Mexico, and Singapore fall under tier 4.

Take Away:

You can see that selling in the US is the most profitable decision you can take as there is huge traffic, good money, and better spending power. Arguably, there is huge competition but this shouldn’t be a problem for you if you know what to do with your products, how to upgrade them before selling.

Selling in the UK is also a good decision as you will not have to face language barriers. Japan can be chosen but the only problem sellers face here is the language barrier. If you are a native of Japan or know Japanese, Japan is the best choice.

 

 

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