- Amazon CEO Jeff Bezos published his annual letter to shareholders on Thursday.
- In the letter, Bezos compared the growth in merchandise sales of third-party sellers on Amazon since 1999 with the growth of third-party sales on eBay during the same time period, which shows Amazon beating out its rival.
- Bezos also wrote that compared to Amazon’s sales of its own merchandise, “third-party sellers are kicking out first party butt. Badly.”
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Jeff Bezos didn’t hold back in saying independent sellers are better off selling their merchandise on Amazon than eBay in his annual letter to Amazon shareholders.
In the letter published Thursday, Bezos compared the growth in merchandise sales of third-party sellers on the two e-commerce websites. The Amazon CEO said “independent sellers do so much better selling on Amazon” than on eBay.
The numbers in Bezos’ letter show that since 1999, Amazon has come from behind and surpassed eBay in third-party merchandise sales. Amazon’s third-party merchandise sales have grown at an annual rate of 52%, hitting $160 billion in 2018. Meanwhile, Bezos writes that the gross merchandise sales of independent sellers at eBay has grown at a rate of 20% per year, and came in at $95 billion this past year.
Bezos credited Amazon’s many sales and e-commerce tools for independent sellers as responsible for the growth in third-party merchandise sales over the past 20 years. He highlighted Amazon’s Prime membership program and Fulfillment by Amazon as two of the most important products available to third-party sellers.
“We invested in both of these programs at significant financial risk and after much internal debate,” Bezos said in his letter. “We could not foresee with certainty what those programs would eventually look like, let alone whether they would succeed, but they were pushed forward with intuition and heart, and nourished with optimism.”
Bezos also credited Amazon’s offerings for processing payments, tracking inventory and shipments, and making international sales possible.
Since the two e-commerce sites first launched — Amazon in 1994 and eBay in 1995 — they have been intrinsic rivals.
As Amazon grows, eBay saw its marketplace growth slow in its third-quarter earnings in 2018, but the e-commerce site also set sales records on last year’s Black Friday and Cyber Monday. eBay sued Amazon in October for allegedly poaching high-value sellers via eBay’s own messaging system.