Amazon Expands Low-Cost E-Commerce Service to New Markets
On Friday, Amazon.com announced a significant expansion of its budget-friendly e-commerce platform, Amazon Bazaar—known as Haul in the United States—adding 14 new markets.
This initiative intensifies the competitive landscape against Chinese counterparts such as Shein and PDD Holdings’ Temu, particularly in the realm of ultra-affordable products, including dresses priced below $10 and accessories for as little as $5.
Heightened import tariffs instituted during the administration of former President Donald Trump have adversely affected consumer sentiment, notably among economically disadvantaged groups increasingly reliant on bargain-priced options.
The standalone Amazon Bazaar application mirrors the offerings of Amazon Haul, which represents a value-oriented shopping segment introduced within the broader Amazon app last year.
Launched initially in Mexico, Amazon Bazaar is expected to provide a vast array of products—most under the $10 threshold, with certain items available for as little as $2.
The category range spans from household goods to fashion, according to the e-commerce behemoth.
Newly targeted markets for this economical service include Hong Kong, the Philippines, Nigeria, and Taiwan. Since its inception in Mexico, Bazaar has successfully penetrated markets in Saudi Arabia and the United Arab Emirates.
According to analyst Gil Luria from D.A. Davidson & Co., “The expansion of Amazon Bazaar marks a pivotal move in Amazon’s strategy for global outreach.”
He elucidated that Amazon typically enters new markets only when it perceives the potential to scale operations effectively while providing a gratifying consumer experience alongside a sustainable profit framework.
Luria noted that Amazon frequently takes years to cultivate profitability in new locales. The company revealed that its international revenue for the third quarter reached $40.9 billion, a 10% increase from the comparable period last year, excluding foreign exchange effects.
“Should Amazon manage to construct a viable proposition focused on a limited assortment of highly affordable items, achieving exemplary service levels, its footprint could extend beyond the current 23 markets to encompass nearly every country globally,” Luria added.
Products listed on Amazon Bazaar are dispatched directly from the company’s extensive global fulfillment network and delivered to customers via an array of service partners.
Meanwhile, competitors Shein and Temu have also accelerated their expansion initiatives beyond the United States. Shein currently operates in over 160 nations, including the US, Brazil, Ireland, and parts of Southern China, while Temu services at least 70 countries.
Both Shein’s and Temu’s US operations have faced impediments, particularly after the Trump administration rescinded the de minimis trade exemption, which had previously allowed packages valued below $800 to enter the country without incurring duties.
Amazon initially launched Haul in 2024, subsequently broadening its reach to include regions like Britain, Germany, France, Italy, Spain, Japan, and Australia.
Source link: Thehindubusinessline.com.
