[ BDSN ] 🗑️ Lots of garbage filling up Amazon

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While Amazon is primarily recognized as a dominant force in e-commerce, where it commands over a third of all U.S. e-commerce sales and about 67% of its own revenue, there is a rapidly growing segment outside its mainstay: advertising.

In the fourth quarter of 2023, online store sales grew by 9% year over year, while third-party sales saw a 20% increase. However, Amazon's advertising sector, which now represents approximately 8% of its total sales, outpaced other areas with a 27% growth rate in the same period.

Amazon Web Services (AWS) remains a significant part of the business, contributing 14% to the total sales and experiencing a 13% growth. Despite this, advertising has become Amazon's third-largest and quickest-growing segment, especially notable since it was only reported as a separate segment starting at the end of 2021.

Advertising is undergoing significant changes with the integration of artificial intelligence, which enhances targeting precision and effectiveness, leveraging Amazon's massive shopper base.

This is crucial as the company expands its advertising capabilities, including the recent launch of sponsored TV ads in the U.S., designed to accommodate smaller businesses. This move not only broadens Amazon's advertising reach but also enhances its revenue potential in high-margin areas.

With continued advancements and transformations in the advertising sector, driven by AI and Amazon's strategic initiatives, this segment is expected to sustain its rapid growth trajectory, providing a robust avenue for revenue expansion in the foreseeable future.

🚢 TRENDS SHOW US IMPORTING LESS from CHINA

China, historically known as the factory of the world, is increasingly setting up new branches in another industrial powerhouse: Mexico.

The practice of Chinese companies bringing their production closer to the US — or “nearshoring” — has seen a serious uptick, with a BBC report outlining how a furniture manufacturer that only set up shop in Mexico 2 years ago already employs more than 450 people.

There’s a whole range of reasons why foreign businesses may want to set up production outlets nearer to the US. Saving on shipping is an obvious benefit for any overseas company, but Chinese firms have extra incentives: the strategy allows them to evade tariffs that can reach up to 25% when selling into the US - a cost that has risen since the escalation of the trade war between the superpowers.

Those tensions have seen American imports from China drop precipitously, and in February, the US bought $32bn worth of Chinese goods, while imports from Mexico totalled $40bn, some 25% more.

Hecho en México

While nearshoring is clearly a financial boon for Chinese manufacturers, it’s provided a very welcome economic boost to America’s southern neighbor too.

Indeed, the Mexican Association of Private Industrial Parks has pointed to the phenomenon as a driving force for industrial park capacity, with the authority anticipating demand for 8 million square meters of new commercial space by 2027.

📚 AMAZON is FILLED WITH GARBAGE E-BOOKS

There is a growing problem of low-quality, scammy ebooks flooding the Amazon marketplace. These ebooks are often created using a combination of AI-generated content and cheap ghostwriters, with the primary goal of making quick money rather than providing value to readers.

The process begins with individuals using keyword scrapers to identify trending topics on Amazon. AI algorithms are employed to generate book outlines and titles that are optimized for search.

To create the actual content of the ebooks, cheap ghostwriters are hired to expand upon the AI-generated outlines. These ghostwriters are often paid extremely low rates, sometimes as little as $0.016667 per word, resulting in poor-quality writing.

The completed manuscripts are then published on Amazon, often under the names of the individuals running the scheme or using the names of established authors to mislead potential buyers.

The Mikkelsen twins, Christian and Rasmus, have become well-known figures in this industry. They offer courses, such as the AI Publishing Academy, which claim to teach others how to make substantial passive income by following their methods.

The rise of these scammy ebooks can be attributed to several factors, including the ease of self-publishing on platforms like Amazon and the incentives created by the modern book-selling economy.

The proliferation of these scammy ebooks undermines the meaningful nature of books and ultimately leaves readers with content that offers no real value.

The impact of this trend is felt by both readers and genuine authors. Readers are left to navigate a marketplace filled with misleading titles and low-quality content, making it harder to find books that are truly worth their time and money.

Meanwhile, authors who have put in the effort to create original, high-quality works struggle to gain visibility and compete with the flood of scammy ebooks.

Read more

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✏️ AMAZON’S NUMBERS GAME - SOME KEY STATS

• Amazon ships close to 1.6 million packages each day.

• 55% of Amazon Marketplace sellers make over $60,000 per year.

• New sellers on Amazon make an average of $30,000 their first year.

• 27% of Amazon Marketplace Sellers make $1,000 or less per month.

• 68% of Marketplace sellers turn a profit within their first year of selling.

• The average Amazon Marketplace seller made $200,000 in gross sales in 2023, up 17.6% year-over-year.

• Amazon counts 1.9 million active sellers on Marketplace in 2023, with upwards of 548 new sellers per day.

• Third-party sellers list nearly 350 million items on Amazon Marketplace and sell an average of 7,800 products per minute.

• 60% of 2022 unit sales on Amazon were with independent sellers.

• 48% of Marketplace businesses are women-owned.

• 53% of Marketplace sellers spend 10 hours a week or less working on their Amazon business.

• 13% of American Amazon Marketplace sellers made over $100,000 in sales in 2021.

• 0.54% of Marketplace sellers in the U.S. made over $500,000 in 2021 sales.

• 0.01% of U.S. Amazon Marketplace Sellers made over $1 million in sales.

• Amazon generated approximately $35.22 billion in annual revenue from subscription fees in 2022

• Amazon has shown a consistent upward trajectory in revenue, growing from $34.204 billion in 2010 to $574.785 billion in 2023.

• Amazon was granted over 40,000 patents in the U.S. from 2010 to 2023

• With net sales of $395.64 billion, the United States was Amazon’s biggest market in 2023.

• Ranking second, Germany contributed $37.6 billion to Amazon’s net sales.

• The UK followed closely with net sales amounting to $33.6 billion.

LAST BDSN NEWSLETTER …
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🧳 TO TRAVEL IS TO LIVE 
→ here’s looking at you kid

My “why” has led me to visit 94 countries and all 7 continents. I create my business around my life. Not my life around my business.

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Enchanting and Alluring Morocco

Morocco stands as a vibrant testament to diversity and cultural richness, offering visitors an array of experiences that encapsulate its unique charm.

From the snow-capped Atlas Mountains to the expansive deserts and serene beaches, Morocco presents a landscape that's as varied as its history.

The medieval allure of Fez, with its bustling medinas and ancient souks, contrasts sharply with the modern vibrancy of cities like Casablanca, though the latter is famously sketched in Hollywood lore.

Visiting Morocco means delving into a shopper’s paradise, where the art of haggling is almost a cultural dance, especially for unique local crafts like carpets, leather goods and pottery.

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✌🏼 Have a great weekend.

See you again Monday.

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