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Deep Dive: Aussies, Get Ready for Amazon!

Executive Summary

In April 2017, Amazon announced that it will launch a full offering in Australia, although it has not yet specified a launch date.

  • We estimate that Amazon Australia could generate total merchandise sales of around A$4 billion in 2021 and A$10 billion in 2026. In 2021, that would equate to a share of approximately 12.5% of Australian Internet sales, which could climb to 20% by 2026.
  • We think Amazon will build share initially in the electronics category, and that the retailer is, therefore, a near-term threat to incumbent electronics specialists.
  • Longer term, Amazon is likely to encourage more Australians to buy apparel, beauty and food online, heaping competitive pressures on specialized brick-and-mortar retailers.
  • With its selling points of choice and convenience, Amazon also poses a threat to multicategory retailers that have built their businesses on similar competitive advantages.

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