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Internet Stocks Boost E-commerce Game: Is Amazon Under Threat?
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E-commerce has become a part and parcel of our day-to-day lives in the fast-paced world, owing to the rapid proliferation of smartphones and online payment solutions. In fact, the pandemic has brought about a sea of changes in the e-commerce industry, courtesy of fast delivery of essentials as well as non-essential items, which has turned out to be a necessity of the new normal.
E-commerce sales have been growing, owing to the coronavirus-led spike in online orders. Per the latest Digital Commerce 360 report, e-commerce sales in 2020 stood at $791.7 billion, up 32.4% from 2019. In first-quarter 2021, the figure exhibited growth of 39% on a year-over-year basis.
We note that Amazon (AMZN - Free Report) — a dominant force in the e-commerce space because of its aggressive retail strategies, robust distribution strength and Prime program — continues to deliver blockbuster performance, capitalizing on the growing adoption of e-commerce in the current scenario.
An eMarketer report indicates that the worldwide e-commerce market is expected to generate sales of$4.9 trillion in 2021, $5.4 trillion in 2022, $5.9 trillion in 2023 and $6.4 trillion in 2024.
The e-commerce giant, which currently carries a Zacks Rank #3 (Hold), is leaving no stone unturned to bolster its last-mile delivery capabilities to gain a bigger share in the booming market. Notably, Amazon’s same-day delivery, one-day shipping and other fast delivery services remain the key catalysts.
However, Internet companies like Etsy (ETSY - Free Report) , Shopify (SHOP - Free Report) , Facebook and Alphabet’s (GOOGL - Free Report) Google are making strong efforts to enhance their e-commerce capabilities in order to make the most out of the burgeoning e-commerce demand.
Consequently, competition is intensifying for Amazon due to the growing delivery initiatives by the big retailers.
Year-to-Date Price Performance
Image Source: Zacks Investment Research
Etsy Poses Challenge to Amazon’s Moat
Etsy, which allowsvarious merchants to list and sell their unique and creative productsvia its marketplace platform, is currently on an acquisition spree. This is likely to pose a serious threat to Amazon’s e-commerce dominance.
Etsy has completed the acquisition of Brazil-based Elo7, which operates an online marketplace for handmade items under 40 retail categories. The most popular categories on the marketplace are special events and life moments like weddings, children's parties, baby and home decor. Further, there are 1.9 million active buyers and around 56,000 active sellers on the marketplace at present.
The buyout adds strength to Etsy’s marketplace offerings, which also include Etsy and Reverb.
Further, this Zacks Rank #3 company has entered a definitive agreement to acquire Depop, a provider of a resale fashion marketplace. Notably, Depop’s registered user base currently stands at 30 million. Further, the company has 4 million active buyers and 2 million active sellers.
We note that Etsy’s marketplace business remains the key growth driver. Solid momentum across active sellers and buyers remains a major positive. The above-mentioned endeavors will likely shape its growth trajectory in the e-commerce market.
Shopify Increases Competition
Shopify, which is a provider of a cloud-based, multi-channel commerce platform for small and medium-sized businesses, is continuously ramping up its e-commerce initiatives on the back of partnerships.
Recently, the Zacks Rank #3 company has extended its partnership with Facebook and Google, which remains noteworthy. Shopify will make its e-commerce checkout solution, Shop Pay, available across Facebook and Google. This will help retailers selling products via the platforms todelivera seamless online payment experience with Shop Pay.
Apart from this, Shopify’s tie-up with Walmart (WMT) remains a major positive. Per the terms of the partnership, both companies introduced a channel to enable Shopify merchants to offer products on Walmart.com. This has been aiding the company in expanding its reach to merchants by enabling sales through multiple channels.
Further, Shopify’s growing focus toward strengthening its fulfillment network is another positive. The 6 River Systems buyout, which is a well-known provider of warehouse technology, remains noteworthy.
Alphabet & Facebook: Strong Contenders
Alphabet’s division Google and the social media giant Facebook have turned out to be strong peers of Amazon in recent times on the heels of an increasing number of merchants on their respective platforms.
Reportedly, the number of sellers on Facebook and Google has exceeded the mark of 1 million, which is a major positive. Also, both companies are experiencing growing shopping activities on their social media platforms.
The recent partnership with Shopify is also likely to help the tech giants attract more sellers to their platforms with expanding online payment options.
Apart from this, the growing momentum across Facebook Shops — a free tool that aids merchants create customized online storefronts for Facebook and Instagram — is likely to aid Facebook to rapidly penetrate the booming e-commerce space. Recently, Shops has been expanded to WhatsApp and Facebook Marketplace, which is expected to help the company in attracting merchants.
Meanwhile, Google’s tie-ups with retailers like Walmart and Target remain noteworthy.
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Image: Bigstock
Internet Stocks Boost E-commerce Game: Is Amazon Under Threat?
E-commerce has become a part and parcel of our day-to-day lives in the fast-paced world, owing to the rapid proliferation of smartphones and online payment solutions. In fact, the pandemic has brought about a sea of changes in the e-commerce industry, courtesy of fast delivery of essentials as well as non-essential items, which has turned out to be a necessity of the new normal.
E-commerce sales have been growing, owing to the coronavirus-led spike in online orders. Per the latest Digital Commerce 360 report, e-commerce sales in 2020 stood at $791.7 billion, up 32.4% from 2019. In first-quarter 2021, the figure exhibited growth of 39% on a year-over-year basis.
We note that Amazon (AMZN - Free Report) — a dominant force in the e-commerce space because of its aggressive retail strategies, robust distribution strength and Prime program — continues to deliver blockbuster performance, capitalizing on the growing adoption of e-commerce in the current scenario.
An eMarketer report indicates that the worldwide e-commerce market is expected to generate sales of$4.9 trillion in 2021, $5.4 trillion in 2022, $5.9 trillion in 2023 and $6.4 trillion in 2024.
The e-commerce giant, which currently carries a Zacks Rank #3 (Hold), is leaving no stone unturned to bolster its last-mile delivery capabilities to gain a bigger share in the booming market. Notably, Amazon’s same-day delivery, one-day shipping and other fast delivery services remain the key catalysts.
However, Internet companies like Etsy (ETSY - Free Report) , Shopify (SHOP - Free Report) , Facebook and Alphabet’s (GOOGL - Free Report) Google are making strong efforts to enhance their e-commerce capabilities in order to make the most out of the burgeoning e-commerce demand.
Consequently, competition is intensifying for Amazon due to the growing delivery initiatives by the big retailers.
Year-to-Date Price Performance
Etsy Poses Challenge to Amazon’s Moat
Etsy, which allowsvarious merchants to list and sell their unique and creative productsvia its marketplace platform, is currently on an acquisition spree. This is likely to pose a serious threat to Amazon’s e-commerce dominance.
Etsy has completed the acquisition of Brazil-based Elo7, which operates an online marketplace for handmade items under 40 retail categories. The most popular categories on the marketplace are special events and life moments like weddings, children's parties, baby and home decor. Further, there are 1.9 million active buyers and around 56,000 active sellers on the marketplace at present.
The buyout adds strength to Etsy’s marketplace offerings, which also include Etsy and Reverb.
Further, this Zacks Rank #3 company has entered a definitive agreement to acquire Depop, a provider of a resale fashion marketplace. Notably, Depop’s registered user base currently stands at 30 million. Further, the company has 4 million active buyers and 2 million active sellers.
We note that Etsy’s marketplace business remains the key growth driver. Solid momentum across active sellers and buyers remains a major positive. The above-mentioned endeavors will likely shape its growth trajectory in the e-commerce market.
Shopify Increases Competition
Shopify, which is a provider of a cloud-based, multi-channel commerce platform for small and medium-sized businesses, is continuously ramping up its e-commerce initiatives on the back of partnerships.
Recently, the Zacks Rank #3 company has extended its partnership with Facebook and Google, which remains noteworthy. Shopify will make its e-commerce checkout solution, Shop Pay, available across Facebook and Google. This will help retailers selling products via the platforms todelivera seamless online payment experience with Shop Pay.
Apart from this, Shopify’s tie-up with Walmart (WMT) remains a major positive. Per the terms of the partnership, both companies introduced a channel to enable Shopify merchants to offer products on Walmart.com. This has been aiding the company in expanding its reach to merchants by enabling sales through multiple channels.
Further, Shopify’s growing focus toward strengthening its fulfillment network is another positive. The 6 River Systems buyout, which is a well-known provider of warehouse technology, remains noteworthy.
Alphabet & Facebook: Strong Contenders
Alphabet’s division Google and the social media giant Facebook have turned out to be strong peers of Amazon in recent times on the heels of an increasing number of merchants on their respective platforms.
Reportedly, the number of sellers on Facebook and Google has exceeded the mark of 1 million, which is a major positive. Also, both companies are experiencing growing shopping activities on their social media platforms.
The recent partnership with Shopify is also likely to help the tech giants attract more sellers to their platforms with expanding online payment options.
Apart from this, the growing momentum across Facebook Shops — a free tool that aids merchants create customized online storefronts for Facebook and Instagram — is likely to aid Facebook to rapidly penetrate the booming e-commerce space. Recently, Shops has been expanded to WhatsApp and Facebook Marketplace, which is expected to help the company in attracting merchants.
Meanwhile, Google’s tie-ups with retailers like Walmart and Target remain noteworthy.
Currently, Google’s parent Alphabet carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>