In the second quarter of 2017, Amazon’s sales of consumables continued its double-digit

growth. Despite the total Health & Personal Care and Grocery markets being in decline,

Amazon’s sales in these product groups grew by an average of 45% across the US, UK,

Germany, France and Canada, according to One Click Retail data. The popularity of Amazon

Fresh and Prime Pantry continues to grow as consumers shift away from brick and mortar

shopping and turn to eCommerce for consumables. Let’s look at how these product groups

(HPC, Grocery, Beauty and Pet Supplies) have sold across Amazon in Q2 2017:

Q2 2017 Consumables Update: Sales and Growth on AmazonBy Nathan Rigby, VP Sales & Marketing at One Click Retail

Amazon Health & Personal Care

Across the US, Canada, the UK and France, Health & Personal Care was

the largest of the four “consumables” product groups, accounting for

nearly half of Amazon’s total consumables sales. While the highest

growth rates took place in smaller markets like Canada and France, even

in the US and the UK (Amazon’s most developed markets), HPC grew by

roughly 40% in Q2. This following a 30% YoY growth in Q1 in both

countries.

In all four countries, Baby Care was a major growth driver, particularly in

France where nearly every top-selling and fastest-growing item was in

the Baby Care category. Household Consumables drove growth in the UK,

France and Canada, with standout growers including Oral Care the UK

and Nutrition & Wellness in Canada. With the total baby products market

experiencing a decline in overall sales, Amazon has emerged as the sole

channel experiencing a significant sales increase in this market and many

top brands such as Pampers experienced triple-digit growth.

Amazon Beauty*Including makeup and lotions, but excluding appliances such as hair dryers

The beauty market has always been a challenging one for Amazon. The cosmetics industry

relies so heavily on experiential retail (free samples are proven to influence purchase

decisions) that eCommerce can’t compete at the same level as it does in most other

product groups. Because Amazon’s success in this area has always relied on volume, Skin

Care is the major growth driver for 4 out of 5 countries in our report. For the most part,

when consumers buy mass market skin care products they know the brands they like and

they stick to them—making Amazon the perfect place to shop.

Make-up and cosmetics are a different story, however. Make-up is a cheap luxury,

something that makes people feel good without breaking the bank, so during the

recession sales of mass market cosmetics actually went up. Now that the

recession behind us, the growth is happening in premium and prestige makeup,

which relies more on specialty outlets and experiential retail. Mass Cosmetics are

experiencing strong growth on Amazon in North America and Make-Up is the

strongest category in France, but overall the Beauty product group is still

dominated by Skin Care.

Amazon Grocery*Including Alcoholic Beverages and Amazon Fresh product groups

Amazon’s recent investments in the grocery space have put a focus on perishables, through the

Prime-exclusive Prime Pantry program. As Prime membership continues to rapidly grow – Prime Day

on June 11th was the busiest single signup day in the history of the program – perishables follow

suit, driving a growth of 110% in the US during Q2. Still, Amazon Grocery is dominated

by Coffee and Beverages, which have always performed well in the eCommerce space. Across all

countries, many of the top items include coffee pods (Keurig and Tassimo brands primarily showing

400+% growth), while two different sizes of Essentia-brand drinking water appear in the three top

growth items in the US.

Alcoholic beverages are also gaining in popularity in certain markets,

with Spirits now ranking as the 2nd-largest (and the fastest-growing) grocery

category in the UK and in Germany, and both Spirits and Wine driving growth in

Germany and France. In most of Canada, however, Amazon is not legally allowed

to sell alcohol; and while Amazon is selling wine in the US, Amazon PrimeNow is

currently only selling Beer, Wine and Spirits in certain states in accordance with

state liquor license laws. So, the demand for these products in the US and Canada

is likely higher than our figures suggest.

Amazon Pet Supplies

Pet supplies are a great fit for eCommerce. Pet Food is especially a good fit, as people typically buy

their pets’ food in more economical bulk sizes, and our Amazon data proves it: Pet Food is the

fastest growing category in all 4 of the countries we’ve examined, and the top selling category in 3

of them. Pet Food’s Amazon domination is clear: the top selling item in the US is a 40-pound bag of

cat food from Precious Cat, a household necessity that would be inconvenient for some and

impossible for others to bring home from the store. In the US, dog food makes up 8 of the 10

fastest-growing items in this product group, with 5 of them from Blue Buffalo, a brand that is quickly

becoming the most popular dog food on Amazon.com.

In Canada, which has the highest growth rate of all four

countries, Amazon is experiencing success with their private

brands, taking both the top selling and fastest growing item

titles: AmazonBasics Pet Training and Puppy Pads has grown

by 710% in Q2 and has made Training & Behavior the top

category in that country.

The growth in sales of consumables on Amazon far outstrips domestic growth in

each of these countries. While consumer trends are shifting, for the most part

people are not buying significantly more consumables than they used to.

Instead, the growth in eCommerce consumables sales (for which Amazon is the

market leader) causes a decrease in brick and mortar sales. Even in product

categories not typically associated with eCommerce, such as perishables and

spirits, brands need to focus their efforts on Amazon in ordered to compete

effectively in 2017.

“The Amazon Effect” series breaks down specific

product groups, compares Amazon’s performance in that

category to total retail sales (online and offline) and

considers the effect Amazon has on that specific industry

as a whole.

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One Click Retail (OCR) is a market leader in eCommerce data measurement, sales analytics andsearch optimization for brand manufacturers in North America, Europe and Asia. Thanks to ourproprietary sales calculations that are 98.5% accurate down to the SKU level, OCR’s accuracyis unrivaled in the marketplace. The OCR Product Suite provides 1st and 3rd party businessintelligence across the 30 largest retailers such as Amazon, Walmart, Target, Staples and HomeDepot. The world’s top brands, such as Procter & Gamble, Panasonic, Nestle, Hamilton Beach andHP, rely on OCR insights to drive sales and profitability across eCommerce.

Founded in 2013 by eCommerce experts from Amazon, Walmart, Target, Overstock and otherleading retailers, OCR was acquired in 2016 by Ascential plc (LSE: ASCL.L), a UK-based internationalB2B media company with a focused portfolio of market-leading events and information servicesproducts.

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