TOP AMAZON COMPETITORS: All You Need To Know

With Amazon’s ascension to the top of the e-commerce industry, the number and size of its competitors have steadily increased as they attempt to carve out their own share of the market. Businesses must remain competitive in an ever-changing digital landscape. So, with so many Amazon alternatives available, who are the biggest competitors? In this piece, we examine Amazon’s main competitors and offer some of the best techniques for eCommerce firms to optimize their own stores.

Who are the Biggest Competitors of Amazon?

Amazon has competition in a variety of industries. Alibaba, eBay, Walmart, JD, Flipkart, and Rakuten are their main retail competitors. Amazon competes with Netflix, Hulu, Apple TV, and Disney+ for the audience of online streaming services. Alibaba Cloud and Microsoft Azure are Amazon’s primary competitors in the cloud computing business.

Amazon Ecommerce Competitors

In the eCommerce business, Amazon has always faced fierce competition. China, in particular, has proven to be a problematic market for Amazon. China is the world’s largest eCommerce economy, and its in-house e-commerce behemoths have proven to be formidable competitors for Amazon, even on a worldwide scale.

#1. Alibaba

In terms of market capitalization and market share, Alibaba falls short of Amazon on a global scale.
With a market capitalization of $430.44 billion in July 2019, Alibaba is the world’s second-largest e-commerce corporation. Amazon’s market value was well over $780 billion as of mid-2019. While Amazon has a strong global footprint, the majority of Alibaba’s earnings come from its Chinese operations alone. Alibaba is also shaping up to be a powerful competitor in the worldwide market.

When we look at the Chinese market, we see that Alibaba outperforms Amazon in practically every category. The following graph depicts the sales share of the various eCommerce merchants in China as of mid-2018.
In mid-2018, Alibaba accounted for 58.2% of all e-commerce sales in China. With only 0.7% of e-commerce sales in China, Amazon has a long way to go.

In terms of the various businesses in which both companies operate, Alibaba is now pretty similar to Amazon. Both cater to the B2C and B2B markets and have their own cloud computing and digital distribution capabilities, among other things.
Amazon joined the Chinese market in 2004 and developed swiftly in the early years, holding 16% of the market share at one point – a far cry from the current 0.7%. The reason for Amazon’s downfall is that local players such as Alibaba were able to cater to local tastes whereas Amazon was unable to.

#2. JD

JD.com, also known as Jingdong, is a Chinese e-commerce site that is viewed as a possible competitor to Amazon, particularly in the B2C industry. Inside China, JD is for B2C and Alibaba is for B2B.

JD easily ranks among the top 10 e-commerce companies in the world, with a market valuation of $28 billion in mid-2019 – it is now rated 7th in the list of the world’s top e-commerce merchants. It should be emphasized that, while Amazon has a wider global presence, JD’s sales and revenue data are primarily from activities in China.
Inside China, JD is the market leader in B2C e-commerce. JD has experienced rapid growth year after year.
JD is now one of the primary competitors of Amazon both within and outside of the Chinese market since it plans to expand into areas outside China in the near future.

JD.com, formerly 360buy, began as an online retailer for purchasing magneto-optical storage disks but gradually expanded into other consumer areas. It is presently China’s second-biggest e-commerce brand and the largest B2C e-commerce platform.

JD serves the B2C sector by selling consumer goods and items through its online platform. It obtains inventory by purchasing it from producers and selling it at competitive prices. Amazon has begun to focus on enhancing “cross-border” sales within the Chinese market after failing to match the speed and prices offered by such competitors.

#3. eBay

In the e-commerce market, eBay has always been a big competitor to Amazon, despite the fact that both are recognized for selling different goods to different consumers. eBay had a market valuation of over $34 billion in mid-2019, making it one of Amazon’s most significant competitors both within and outside of the United States.
In terms of e-commerce sales, eBay is the closest competitor to Amazon, particularly in the United States – in mid-2018, eBay accounted for 6.6% of all e-commerce sales in the United States, placing it just below Amazon. Despite it being far from Amazon’s 50% share of e-commerce sales, eBay has maintained its position continuously to date.

eBay presently operates in 27 countries and is best known for its C2C model, in which customers may sell their used products to other customers, making eBay a popular platform for buying and selling used consumer goods. Amazon, on the other hand, is primarily concerned with B2C – that is, with providing a platform for businesses to sell their items to customers online.

Amazon’s Offline Competitors (Same Target Audience)

Amazon’s target audience does not rely solely on e-commerce purchasing; many go out and buy things offline, even if they are available online on Amazon. Yet, these traditional competitors have begun online operations, chipping into Amazon’s market share.

#1. Walmart

Walmart, a multinational retail chain comprised of hypermarkets, supermarkets, and grocery stores, is regarded as one of Amazon’s main competitors, particularly in the consumer retail and electronics industries.

With a market share of 3.7% in 2018, Walmart ranked third in the US online retail sector and has shown consistent growth year after year.
With its combined resources of brick-and-mortar and online stores, has shown to be a formidable competitor to Amazon, particularly in the physical retail market.

Walmart’s online stores allow customers to purchase items and products from the company without ever leaving the comfort of their homes – with the same savings as if they visited a local Walmart location. Amazon, on the other hand, has a stronger online presence than an offline presence.

#2. The Home Depot

In terms of competing with Amazon, Home Depot is comparable to Walmart in that it operates as a brick-and-mortar retailer with an online store that mirrors the products in the store for people to buy from.
In 2018, The Home Depot ranked fifth among the largest e-commerce platforms in the United States, with a market share of 1.6%.
Home Depot, like Walmart, has been steadily developing and benefits from both its offline and online presence.

The Home Depot was started in 1978 and is now the largest home improvement retailer in the United States. They offer tools, construction supplies, and tools and services, and it established its online store in late 2000 to sell its products at pricing similar to those found in its physical stores.

Amazon and The Home Depot compete in the “home improvement” segment, and The Home Depot has been prepared to compete with Amazon by offering speedier deliveries and an improved online shopping experience. As a result, The Home Depot is becoming a physical competitor to Amazon.

Amazon Web Services (AWS) Competitors

Amazon’s cloud service platform, Amazon Web Services, has long held the top rank and dominates the cloud business. But, in recent years, solutions from businesses such as Microsoft and Google have made a dent in the industry, stealing some market share from Amazon.

#1. Microsoft Azure

In the fourth quarter of 2019, Microsoft Azure, the company’s cloud service offering, held more than 17% of the cloud market share. Azure is now the world’s second-largest provider of cloud infrastructure and platforms. Azure has also demonstrated significant year-over-year growth, positioning it as a direct challenger to Amazon in the cloud computing business.

Both AWS and Azure are very similar in the sense that both cloud services are primarily geared toward “business” users. While Azure drew on Microsoft’s prior experience, Amazon has risen to the occasion by reinvesting a large portion of its annual earnings back into expanding AWS.

#2. Google Cloud Platform (GCP)

Google Cloud Platform (GCP) is more of a complement to AWS and Azure than a one-click solution.
In Q4 2019, Google Cloud Platform ranks third with a market share of 6%, and it has been bouncing between third and fourth place for the last few years, despite increased competition from Alibaba Cloud and IBM Cloud. Nonetheless, Google Cloud Platform has demonstrated significant growth, making it a credible competitor to Amazon in the near future.

While Amazon provides over 140 distinct services to its consumers across computing, IoT, mobile, networking, and corporate applications, GCP still falls behind in terms of the number of services it provides and is generally the less flexible of the two.

Google Cloud Platform is more popular with Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) use cases than with Enterprise use cases – and the enterprise is where the majority of the money is. Google intends to fight this by increasing its investment in improving enterprise processes and forming new partnerships.

Amazon Artificial Intelligence Competitors

While Amazon offers AI services to consumers through its AWS platform, its most popular use of AI is to power its virtual assistant Alexa. Alexa is up against two other industry heavyweights, Apple and Google, on an equal footing.

#1. Google Assistant

The Google Assistant is available on a range of devices and presently holds 36% of the market share, with Apple’s Siri.
The Google Assistant is more general-purpose, but Amazon’s Alexa is capable of assisting you with day-to-day tasks and has the extra convenience of being able to place Amazon items with just a voice command.

#2. Siri, Apple’s voice assistant

Even though it is exclusively available within the Apple environment, Siri is highly popular. For a virtual assistant that is locked into a single ecosystem, it has managed to maintain the first place for a very long time because of two advantages: Siri was one of the first commercial AI virtual assistants to hit the market, and it was one of the first commercial AI virtual assistants to be released.

Because of the popularity of Apple’s iPhones, which include Siri as part of the software interface,
Only in late 2019 was Google Assistant able to equalize, and both now maintain the first slot with a market share of 36%.

Amazon Digital Distribution Competitors

Amazon has a wide range of products. It has its own digital distribution service, Amazon Prime Video, and Amazon Prime Music, as well as a production studio, Amazon Studios, in addition to its e-commerce and cloud services.

#1. Netflix

Netflix is the firm Amazon must defeat in order to take the top place. With over 158 million viewers as of mid-2019, Netflix was the leading digital distribution provider in the United States and around the world.

Netflix has ruled supreme in the digital distribution market with its spate of originals produced under its own brand and several different TV shows and series.

In terms of digital distribution services, Amazon and Netflix take a similar strategy.
Both platforms use a subscription model and have over 100 million users. Netflix has also been in the market for much longer than Amazon Prime, having launched in 1997, while Amazon’s Prime Video offering debuted a decade later, in 2007.

Each has its own production studios dedicated to developing movies and television shows for their respective platforms. Netflix and Amazon invest extensively in their studios and platforms, with Netflix investing over $6 billion and Amazon investing approximately $4.5 billion, respectively.

Both Amazon and Netflix have exhibited consistent year-over-year growth, but it may take some time for Amazon to catch up to Netflix, making Netflix a significant competitor to Amazon.

#2. Spotify

Spotify is a music streaming service that allows users to listen to millions of songs, albums, and playlists. At the conclusion of the first half of 2019, Spotify had 36% of the music subscription market share, with over 108 million customers subscribed to its platform.
They always had a distinct advantage over Amazon’s own product – Amazon Prime Music – in that it offers both free and paid content.

Spotify was founded in 2006, a year before Amazon Music, and quickly rose to prominence by providing a simple, user-friendly platform for streaming music over the internet.
Despite Spotify’s dominance in the music streaming sector, Amazon has grown rapidly since its inception in 2007.

The rapid rise can be ascribed to the fact that Amazon Prime Video and Music are bundled with a single Amazon Prime subscription, which also includes a variety of other features and services.

Amazon Grocery Competitors

Amazon’s entrance into groceries and department stores began in August 2017 with the acquisition of Whole Foods Market, an international supermarket and department store chain. In-store sales growth was gradual in the early years and still has a long way to go before catching up to the big-name companies in the physical retail sector.

Amazon had a modest in-store market share before and after acquiring Whole Foods. Before Amazon’s acquisition of Whole Foods, both companies had a meager market share of 1.21% and 0.19% in the American grocery sector, respectively.
It’s a different situation in the online food industry, where Amazon reigns supreme and its nearest rival doesn’t even come close.

#1. Kroger

While Walmart is a bigger challenge to Amazon in terms of online grocery sales, Kroger has shown significant year-over-year growth, making it a possible threat to Amazon.

Kroger ranked third with over $1.5 billion in online grocery sales in mid-2018, trailing only Walmart’s $2.84 billion and falling short of Amazon’s $8.2 billion. But, its year-on-year growth rates have been impressive: in 2018, Kroger boosted its sales by 64% over the previous year, and it has continued to expand steadily since then. Kroger is thus a worthy competitor to Amazon in the supermarket sector.

How Can a Small Business Compete With Amazon?

Competing with a behemoth like Amazon can appear nearly impossible for a small business. But, there are ways to differentiate yourself from the competition and earn clients who will advocate for your business.

#1. Provide an unforgettable customer experience

Customer experience is the ultimate differentiator for every brand, and the major criteria your audience will judge you on in today’s society.

According to a Segment survey, 71% of shoppers are dissatisfied when brands do not tailor their buying experience. But, after having a personalized encounter with a retailer, 44% are more inclined to make a repeat buy.
Improve your customer service by:

Handwriting thank you notes for customers
Personalizing and sending relevant emails
Giving rewards in exchange for feedback
Quick resolution of consumer complaints

#2. Make omnichannel a priority.

Today’s consumers want brands to be available on numerous platforms. They also want a consistent buying experience across all of their platforms. Offering an omnichannel experience is critical to establishing a competitive advantage when acquiring new customers and retaining existing ones.

A Shopify research study found that 73% of shoppers use multiple channels before completing a purchase. As a result, firms that sell through numerous channels (mobile, social media, online storefronts, and physical locations) stand out.

Begin by assessing your target audience before building your omnichannel approach. Consider where your clients are most likely to want to purchase anything. Do they spend the majority of their time on social media when they are not purchasing on marketplaces such as Amazon? If so, the purchasing opportunities on Facebook and Instagram are great.
Building an omnichannel environment will not only impress your customers but will also provide you with more options to grow sales by reaching a bigger audience.

#3. Create an active community

Another strategy to compete with Amazon is to create an active presence in the local community. Small businesses have an edge in this regard since they understand their community’s needs better than international firms, making it easier for them to get involved and inspire customers.
Here are some ways you may help:

Taking part in or sponsoring local events
Organizing volunteer opportunities for your employees
Contributing to local issues
Joining appropriate community boards for your business

#4. Market in niche markets

Marketplaces give an opportunity to tap into an existing audience. Nevertheless, Amazon isn’t the only online store to explore. You can sell on other marketplaces that customers already know and trust.
The best marketplace for you will be determined by the type of business you run. As an example:

Etsy is ideal for selling handmade things.
eBay is an excellent platform for selling collectibles and vintage stuff.
Chairish is ideal for selling furniture and home accessories.

Who are Amazon’s Indirect Competitors?

Indirect competitors are companies that employ a distinct business strategy but target a comparable clientele. Here are a few examples of the indirect competitors of Amazon:

Shopify
Apple
Google

Conclusion

Small businesses clearly cannot compete with Amazon on price or shipping times. The retail titan has a big logistics network and can acquire things in massive volumes at incredibly low prices. Amazon may terrify new ecommerce firms at first, but the truth is that you can outrun Amazon by producing distinctive products and personalized shopping experiences that customers enjoy.