The Power of Amazon

How 19 Business Divisions Fuel Amazon’s Flywheel

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About This Report
When Amazon starts a new business, competitors scrap business plans and markets shudder. We examined 19 of Amazon’s divisions to help parse how the company fuels its flywheel to keep driving the virtuous cycle.
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Executive Summary

When Amazon starts a new business, competitors scrap business plans and markets shudder. We examined 19 of Amazon’s divisions to help parse how the company fuels its flywheel to keep driving the virtuous cycle.

How dominant is Amazon?

Amazon joined the $1 trillion market cap club in early 2020 and has the first-mover advantage for several businesses, most notably as a commerce platform and a marketing powerhouse. It also created a loyalty program that other businesses now try to emulate. We forecast that Amazon’s share of US ecommerce sales in 2021 will be 41.4%; next in line is Walmart with a 7.2% share. According to CNBC, Amazon’s revenues per minute were $837,330.25 in Q1 2021; Apple was next with ​​$691,234.57 per minute.

Why look at the power of Amazon in 2021?

The global pandemic accelerated several digital trends where Amazon excels, including ecommerce, delivery services, cloud computing, digital payments, home security, streaming entertainment, and online advertising.  

How many consumers participate in Amazon Prime, the loyalty program that keeps customers using multiple divisions?

We forecast that well over half (63.4%) of all US households will use Amazon Prime this year. To put that in perspective, we estimate that in 2016, just 35.6% of US households subscribed to the service.

WHAT’S IN THIS REPORT? Our analysts evaluated 19 of Amazon’s business divisions, assessed how each drives the business, and forecast where each will be in five years.

KEY STAT: Amazon has seen significant revenue growth from both old and new business lines over the past few years—reaching over $386 billion in revenues worldwide in 2020.

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Table of Contents

  1. Executive Summary
  2. The Power of Amazon
  3. Retail Ecommerce
  4. Amazon Pay
  5. Non-Ecommerce Retail
  6. Grocery
  7. Just Walk Out
  8. Amazon Pharmacy
  1. Fulfillment by Amazon
  2. Advertising
  3. Amazon Business
  4. Business Payments
  5. Amazon Web Services
  6. Amazon One
  7. Ring Home Security
  8. Echo and Alexa
  1. Kindle and Fire Tablet
  2. Fire TV
  3. Video
  4. Audio
  5. Gaming
  6. Read Next
  7. Upcoming Reports
  8. Media Gallery

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authors

Suzy Davidkhanian, Blake Droesch, David Morris, Nicole Perrin, Lisa Phillips, Jillian Ryan, Jaime Toplin, Paul Verna, Sara M. Watson, and Yoram Wurmser

Contributors

Grace Broadbent
Research Analyst, Payments & Commerce
Daniel Keyes
Analyst