What are the top trends that Amazon experts are predicting for 2021?
How are Amazon Categories performing in 2021 vs. 2020? How can you be prepared for the several challenges that you could possibly face in 2021?
2020 has been really tough for a lot of sellers, disrupting most business industries in one way or another. There have been winners and losers. And Amazon was definitely among the first kind.
Amazon is one of the few businesses that got a significant boost from the COVID-19 pandemic. Amazon’s Q4 2020 earnings were $125.6 billion, a 42% increase in earnings (Motley Fool, 2021).
However, the year 2020 has coerced most online businesses to a rapid evolution: more advertising, different consumer habits, different sellers.
So, how is it going to be in 2021?
Here’s DataHawk’s report with Key data insights drawing a comparison between 2020 and 2021.
1. Top Selling Categories in 2021 vs. 2020?
At DataHawk, we analyzed the performance in sales of the top 20 categories in the US across a sample of our clientele. We summed up our estimated monthly sales per category.
Here’s an exclusive, filtered view of some categories with highlights based on their nature of evolution.
a) Best bets for 2021 →
Home & Kitchen - Kitchen & Dining
It comes as no surprise that the Home & Kitchen is the most selling category on Amazon. Amazon US saw stupendous sales activity during April- May 2020 & September 2020; Kitchen & Dining witnessed an estimated evolution from 170% in March to 222% in April(the highest peak).
We saw how the two categories are growing in their rankings attributed to their estimated sales and can be seen as the most selling categories for the year. The graph shows a steady increase month over month for the two categories. It is predicted to follow the trend, seeking remarkable growth in 2021.
It is seen that the Coronavirus pandemic has undeniably intensified the trend and completely changed the way consumers interact with brands and retailers.
- Visits to Amazon’s Home & Kitchen category rose 5% YoY in Jan – Apr 2020(Similar Web)
- Kitchen & Dining has also seen a boost in its overall growth trajectory. (Similar Web)
Pro Tip: If the categories you want to sell on seem too competitive and oversaturated, it’s essential to weigh your chance of landing on page one of Amazon’s search results.
What you could do best is dig deeper into various subcategories to find the best spot for your product using Amazon market research.
Why is Home & Kitchen a go-to category for sellers?
- Fewer restrictions: Selling in the Home & Kitchen category on Amazon is more comfortable than others because it doesn’t restrict new sellers from listing. See restricted categories here.
- Most common products: The category is home to products that everyone uses.
- Less number of regulations: Sellers need to follow Amazon compliance and federal regulations; for instance, for food products, they must have an expiration date, toy sellers were restricted during Q4, etc. Whereas, Home and Kitchen is less complicated in terms of regulations, making it easier for sellers to sell in the category on Amazon.
- Easy to manufacture: Finding a supplier to manufacture a kitchen product is relatively easy compared to many other types of items. Search through kitchen supplies on Alibaba, and you’ll see how easy it is to get almost any kitchen product you can think of.
b) High Seasonality Categories →
Toy & Games, Patio, Lawn & Furniture, and Office Products
The United States is the largest furniture market in the world. However, the APAC region grew in size and importance and accounted for three of the top five leading markets in 2020. The international trade of furniture products is a significant business, with the import and export of furniture witnessing steady growth in recent years. (Statista)
Amazon is also catering to all the home or residential furniture markets’ critical categories, such as living room, dining room, bedroom, kitchen, and outdoor furniture and furnishings.
Our analysis of this seasonal category found that Patio, Lawn, and Furniture was super popular in summers. The category had an estimated sales evolution from 292% in April to 402% in June, where the sales went up the roof.
With global economies shuttered and people forced to stay at home in the aftermath of the coronavirus outbreak, many toy and game categories experienced tremendous growth as people sought to keep themselves entertained in quarantine. Toys & Games (Purple line) gained popularity before Christmas. The category is predicted to depict a similar trend for the year 2021.
Office Products were seen to be in demand in January 2020 & September 2020 attributed to New year and when office products are restocked.
The global office services and supplies market continues to benefit from the economic recovery, fueling demand for products such as stationery and printers. As has been the case in many industries, e-commerce sales saw substantial gains in office supplies. From 218% in January to 274% in September, Amazon US saw massive growth as the pandemic caused temporary store closures and hesitancy to go in-store from the consumer.
Packaging related products in the category also benefited from increased items being shipped, including marketplace sellers that needed packaging materials. The was also brought about by people who chose to relocate during this time.
2. Sponsored Slots’ weightage within total search results slots, 2020 vs. 2021
Amazon advertising has been growing to become increasingly important every year.
The rollout started in 2019 when Amazon added a number of programs within the Amazon advertising platform, for instance, new targeting options, increased access to display and video ads, and several recent reports and data points.
As a result of this evolution, we saw a reduced number of organic slots on the Amazon search engine results page (SERP). Not only that, but Amazon also added ad slots and placements for paid search, editorial recommendations, Recommended articles, and more.
Amazon Ads is evolving rapidly, and while the platform is still fundamental compared to Facebook or Google Ads, it’s slowly becoming comparably sophisticated.
For this chart, we're looking at the proportion of organic/sponsored/generic products on the 1st page of more than 50k keywords.
The chart represents that the proportion of sponsored and generic (other featured products) products has been continuously increasing through 2020 and the beginning of 2021. While in June 2020, the organic ad slots had a 97% share, by August 2020, it dropped to 85% & to 77% in January 2021, delineating a stable decrease. Since then, the organic share is stable and seems to follow the same trend for the year 2021.
With this, we can expect the competition to increase within the Amazon Sponsored Ads section in 2021.
And with the enhancements in Amazon ads and ads reporting, it is essential to understand the science and art of Amazon Ads to make your ad campaign optimization better to maximize your potential sales.
Here's a podcast to help you Master Amazon Sponsored Product Ads
Have you ever attempted to drive external traffic to your Amazon listings? Amazon Attribution dashboard on Amazon is specifically designed to do just that.
Take a closer look at Amazon Attribution, what it is, how it works, and how you can use it to increase your conversions.
3. How did Delivery Speed change in 2021 vs. 2020?
Over the past couple of years, Amazon has been leasing planes to build its fleet. With 11 jets from Delta and WestJet airlines to boost its growing delivery network and get orders to shoppers faster, it's the first time it has purchased planes for its delivery network.
With the continuous efforts to make the delivery process smoother and faster and restore fast shipping and reduce dependency on other carriers, it was interesting to analyze the delivery speed in 2021 vs. 2020.
In the chart above, we are looking at around 150k products throughout the last 11 months.
The first peak was seen in March due to Covid when the delivery time was more than 6-7 days, which then reduced to an average of 5.5.
Another peak in December 2020 is attributed to the Christmas gift folie, where due to the massive number of orders, the delivery time was increased.
However, 2021 seems a lot better than 2020. The 1st semester itself has shown great improvement. Here’s a snapshot:
Avg(2020 first semester) = 5.93 days
AVG(2020) = 5.98 days
Avg(2021 Jan + Feb) = 5.34 days
The average delivery time has decreased by 11%. This translates into a 14 hours win for the delivery time average. The significant change can definitely be seen as a good sign for 2021.
All in all, the previous year did throw a zillion challenges at Amazon. But Amazon is looking all set to leverage new opportunities and persistently innovate what’s already working for them. Amazon has set standards high for brands & sellers, and 2021 is the year for more focus and innovation. We are excited to see what the 2021—and Amazon will bring to us!
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