Amazon is one of the most successful entities in the world. The American multinational tech giant was founded in 1994 by Jeff Bezos in Seattle. Amazon is, by all rights, an all-rounded company as it focuses on many different industries, including e-commerce, cloud computing, artificial intelligence, and digital streaming. It is among America's big five information technology companies, including Apple, Meta, Alphabet, and Microsoft.
The company originally started as an online market for books but has steadily expanded its product categories over the 20 years it has been in operation. Amazon has multiple subsidiaries, including Ring, Twitch, Amazon Web Services, Zoox, Amazon Lab126, Kuiper systems, IMDB, and Whole Foods. The company's footprint as a physical retailer was established in 2018 when it acquired Whole Foods. The use of technology has made Amazon one of the biggest industry disruptors.
In 2021, it beat Walmart to become the world's largest online retailer outside of China. Amazon Prime's huge subscription base of over 200 million worldwide subscribers has led to the company's massive success. It is the second largest employer on the list of private companies in the United States, just after Walmart. So which companies out there provide similar services and products as Amazon? Even though Amazon has grown to become a giant with its hands in many pies, it still faces stiff completion from many businesses. Companies like eBay, Alibaba, Walmart, Rakuten, and Shopify hold their ground in e-commerce and still make millions in profit annually. We compiled a list of 10 companies that are similar to Amazon.
An American e-commerce company, Etsy, was launched in 2005 by iospace. The company sells vintage or handmade items and supplies for crafts and arts. Etsy is the home of many creatives who want to sell their items to a select group of people who like handmade and vintage things. These categories include jewelry, clothes, home décor, bags, furniture, toys, and many more. Vintage items are usually more than 20 years old. Like Shopify, the Etsy site gives online retailers personal stores where they can list their goods. Even though it is a fairly new company compared to other companies on this list, Etsy has grown tremendously over the years, with over 100 million items listed in its marketplace.
The main difference between Amazon and Etsy is that Etsy caters mostly to people interested in creative pieces made from recycled materials, while Amazon sells everything. Even though the company is much smaller than Amazon, it has seen incredible success over the years, making annual revenues of over a billion dollars. According to Macro Trends, Etsy made $2.3 billion in annual revenue, up by 35% from the company's 2020 annual revenue of $1.7 billion.
Target, one of America's biggest retail department stores, started in 1962, and its headquarters are in Minneapolis, Minnesota. Although it is not as well established as Amazon in the e-commerce world, it is one of Amazon's biggest competitors. Target has over 1900 stores across the United States and is among the country's fortune 500 companies. Like Amazon, Target has its hands in almost every industry. It has private label products ranging from grocery products, pet foods, decoration brands, children's clothing and bedding, a women's clothing line, home décor, and many others. In addition to its numerous private label products, Target provides financial and retail services.
Although Target and Amazon's business strategies are a little different, it has a huge loyal following, and the fact that Target offers its customers convenience is a huge winning point for the retailer. Even though Target is still compared to Walmart and Amazon, the launch of its e-commerce platform saw the company take up a small percentage of the e-commerce market share in the country. Target released their full 2021 earnings, and according to their press release, the company made $106 billion in annual revenue in 2021, a 12% increase from 2020's revenue of $92.4 billion.
Shopify Inc. is a Canadian international e-commerce company. It was founded in 2006 by Scott Lake and Tobias Lutke after their failed attempt to open an online store for snowboarding equipment. Shopify's company headquarters are in Ottawa, Ontario. The company provides online retailers with several services, including payments through its point-of-sale systems, marketing, shipping services, and tools for customer engagement. It offers management services to online stores, including free website designs for new retail store owners without websites. With more than 1.7 million businesses in over 170 countries worldwide, Shopify is fast becoming a worthy competitor for Amazon.
Shopify is almost like a mall that rents spaces to businesses and offers its renters additional incentives for storage, packaging, and shipping services. But it is a little different from Amazon in that it offers online retailers a way to build and manage their standalone stores within the Shopify platform. According to Business Strategy Hub, in 2020, Shopify was the biggest e-commerce software in the United States, with over 30% of e-commerce websites in the country. In 2021, Shopify made $4.61 billion, a 57% increase from its revenue in 202, which was $2.9 billion. Unlike Amazon's 8 million sellers, Shopify's one million merchants seem like a drop in the ocean.
Rakuten is a Japanese company that deals with e-commerce and online retailing. It was founded in 1997 by Hiroshi Mikitani and is based in Tokyo, Japan. The company provides financial services and communications and digital content services through Viber, a messaging app; Kobo, an e-book distributor; and Rakuten Mobile, its mobile carrier. Otherwise known as the "Amazon of Japan," Rakuten has its fingers in many different industries. The company bought Buy.com, now Rakuten.com in the U.S., Priceminister in France, now Rakuten.fr, Play.com, Viki, and Tradoria. With stakes in major transport companies Lyft and Cabify, among other companies.
Just like Amazon, Rakuten is not just an e-commerce platform. It also provides streaming services, food delivery, marketing, and data analysis services, financial technology services, and telecommunications services, to mention a few. Its retail strategy is a little different from Amazon's as it uses a cashback system to entice its customers to buy products from Rakuten instead of going directly to buy from brands. Rakuten made an annual revenue of $15.3 billion in 2021, which was 11% higher than its revenue in 2020.
One of India's most popular e-commerce companies, Flipkart, is headquartered in Bangalore, India. It was founded by Binny Bansal and Sachin Bansal in 2007, both former Amazon employees. Initially, Flipkart was an online book store before it expanded its product categories into electronic, fashion, groceries, and lifestyle products. Flipkart's main competitor in India is Amazon's subsidiary, Snapdeal. In 2017, eBay sold its Indian subsidiary to Flipkart, propelling the company further. Walmart won a bidding war against Amazon for the majority stake in Flipkart, which it acquired for $16 billion. Since then, Walmart has had the majority share in the company with 77% ownership.
Flipkart and Amazon have India's biggest market share in online retail services, with each company getting over 30% market share. Looking through the Indian media and reviews, one can tell that Flipkart is giving Amazon India sleepless nights as both online retail stores go head to head. Flipkart entices its customers using its Plus SuperCoins reward schemes, allowing them to earn points on all their purchases and trade them for extra discounts. In the 2021 financial year, Flipkart made $5.3 billion.
eBay was the first company to provide online auction services, which allowed person-to-person transactions. Pierre Omidyar founded the company in 1995, and the dot.com bubble propelled it into success. The company is now a multibillion-dollar business with operations in more than 32 countries. Headquartered in San Jose, the company's website enables business-to-consumer and consumer-to-consumer sales. The eBay website is mainly an online auction and shopping website where people and businesses worldwide can buy and sell all sorts of goods and services. It is free for buyers, but sellers have to pay a fee for listing their items after several free listings and pay an additional fee once they sell the item.
Although eBay is a direct competitor to Amazon, the biggest difference is that eBay allows buyers to bid for items they want to buy. Retailers can decide to either auction an item or apply a fixed price to it, while Amazon does not allow for auctions. It is a perfect place for people to find electronics, décor, equipment, cars, collectibles, domain names, and so much more. Although the company has taken some financial hits recently, its financial status is improving. According to Statista, its annual revenue increased significantly in 2020 to $8.8 billion and in 2021 to $10.4 billion, which was a 17% increase from 2020. The website gets over a million visits a month on average.
Otto Group is one of the most successful e-commerce companies in Europe. The company was founded in 1949 by Werner Otto. Initially, the company sold shoes, but in the 1950s, it expanded its product range to include telephone orders, and in 1995, the company launched its online shopping website. Otto's main focus is its e-commerce and online retail business, which also expanded to provide consumers with real estate and financial services. The company is a one-stop shop in Germany for various consumer items, including electronics, furniture, home décor, sports gear, clothes, and accessories. This company is based in Hamburg, Germany and the Otto family owns the majority of the company's shares.
The company is a big Amazon competitor in Germany, and in 2020, the company came second after Amazon in the most profitable retailers in Germany. According to the Otto Group Company website, in 2021, the company made EUR 16.1 billion ($15.43 billion) with a net profit of EUR. 1.81 billion ($1.73 billion)
3. JD.com (Jing Dong)
Jing Dong is internationally known as Joybuy, a Chinese e-commerce company. It is one of China's biggest business-to-consumer (B2C) online retailers and its biggest online company by revenue. Liu Qiangdong founded the company in 1998, and the company went online in 2004. JD is a Fortune 500 company and a serious competitor to T-mall, owned by AlibabaInitially, the platform was an online store for magneto-optical discs. However, it started diversifying its product catalog to include electronics, computers, and phones. The company was formally known as 360buy but changed its name to Jing Dong in 2013. JD.com has the world's largest drone delivery systems and infrastructure because the company invested heavily in artificial intelligence and advanced technology.
The company is very similar to Amazon in its e-commerce business strategies. However, the two companies differ because JD.com offers its users the ability to buy items in bulk, like Costco, and at discounted prices. According to Companies Market Cap, in 2021 JD.com made $147.2 billion a 27% increase from 2020’s $108.9 billion.
Walmart is an international retail corporation that operates a chain of supermarkets, discount and grocery stores in the United States. Sam Walton founded it in 1962, and the company headquarters are in Bentonville, Arkansas. Walmart has over 10,000 stores in 24 countries. According to Fortune Global 500, Walmart is the biggest company in the world by revenue, making about $570 billion annually. The company has the world's largest employee base, with over two million employees worldwide.
Although Amazon leads the e-commerce space, Walmart's online presence is growing fast. Walmart's online store, Walmart.com, leverages its massive physical presence in many areas in the United States to sell and deliver various familiar brands to its customers. The two retailers always compete in the U.S., the country's two biggest retailers. Amazon and Walmart fight for the same customers and compete on digital growth, innovation, sustainability, and logistics. In 2021, Walmart made $559.1 billion.
1. Alibaba Group
The Alibaba Group is a Chinese international tech company. Jack Ma and 17 students and friends founded the company in 1999 in Hangzhou, Zhejiang. Like Amazon, the company has its hands in many different industries, and The two companies share the same markets. It focuses on the e-commerce, internet, retail, and technology industries. Alibaba offers consumer-to-consumer, business-to-consumer, and business-to-business services through its website, cloud computing, and electronic payment services. Alibaba is one of the world's biggest retailing and e-commerce companies, and everyone has heard about it. As Wikipedia stated, the company was the second Asian, valued at over $500 billion.
Alibaba Group owns the largest Consumer to consumer service, TaoBao, Business to Business service, Alibaba.com, and Business-to-business service, Tmall. Each of its subsidiaries competes with Amazon by selling electronics, accessories, and clothes for low prices. Alibaba.com, the company's most famous subsidiary, connects businesses directly with manufacturers of different products in China, cutting out the middlemen. Alibaba's revenue in 2021 was $109.4 billion, an increase of over 50% from 2020's revenue of $71.9 billion.
Written by Dana Hanson
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