• Business Insider

Amazon had its best holiday season ever


Amazon had its most successful holiday shopping season to date in 2016, according to a batch of statistics that the company released.

In particular, the stats illustrate the popularity of the company’s Prime membership service and Echo devices, as well as its rapidly expanding logistics capabilities:

  • Amazon reported that it shipped more than 1 billion items through its Amazon Prime and Fulfillment by Amazon services. Fulfillment by Amazon allows third-party sellers on Amazon’s marketplace to use the company’s logistics network to deliver their orders. Last year, Amazon shipped 200 million items through Amazon Prime during the holiday shopping season.

  • Sales of Amazon’s Echo line of smart speakers increased nine-fold compared with last year’s holiday shopping season, though the company did not give an exact number for the sales. The company ran out of stock of the Echo and Echo Dot speakers several days before the end of the holiday season, indicating that sales outpaced Amazon’s own expectations.

  • Amazon Prime Now, which offers free two-hour delivery on specific items to Prime members in select areas, helped Prime members get their last minute shopping done. The most popular day of the holiday season for Prime Now orders was December 23, the company said.

  • Amazon said that it also more than doubled its sales on Cyber Monday in 2016 compared with 2015, though it again did not give specific sales numbers.

The stats show that as online shopping plays an increasingly large role in the holiday shopping season, Amazon has positioned itself well to benefit. The expansion of its logistics and fulfillment capabilities mean that Amazon is less reliant on UPS and FedEx to deliver holiday orders on time, which the two carriers struggled to do again this year. The successful season for its Echo line of devices also points to the company’s ability to deliver hit electronics products. Amazon could look to build on this success in the future with updates to the Echo speakers timed just before the holiday season.

E-commerce has been on the rise in the last several years, thanks in large part to titans in the industry such as Amazon and Alibaba. E-commerce will truly become the future of retail, as nearly all of the growth in the retail sector now takes place in the digital space.

BI Intelligence, Business Insider's premium research service, forecasts that U.S. consumers will spend $385 billion online in 2016. Moreover, BI Intelligence predicts that number will grow to $632 billion in 2020.

This is hardly surprising considering e-commerce's healthy growth. Though the U.S. retail average growth rate in the first half of 2016 was just 2% for total retail, it was 16% for e-commerce.

The number of online shoppers has grown by nearly 20 million from 2015 to 2016. And these 224 million shoppers are spending more, as the total amount spent online grew from $61 billion in the first quarter of 2015 to $68 billion in Q1 2016. Finally, these customers are transacting more frequently, as the number of online transactions has risen by 115 million from 2015 to 2016.

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