Amazon Follows Typical US Online Retailer Expansion Path With A New Site For Italy

Amazon today launched a localized site for Italy, its first new international offering since acquiring Joyo back in 2004 (Amazon’s UK and Germany sites were launched in 1998, France and Japan in 2000 -- the Canada site came in 2002. Full timeline available here). According to today's press release, the new offering has more categories than any new Amazon Web site has ever launched with -- not surprising given the six years that have elapsed since the last international launch.  

As part of its new offering, Amazon is pushing its selection of “hard-to-find Italian language items” to cater to local consumer needs -- indeed, Amazon has tended to excel in its localized offerings, ranging from its varied payment methods by country to its semi-localized categories (note the “Auto and Motorcycle” category on the German Web site or the “DIY” link on the UK one).  

Amazon’s choice of European markets mirrors many US online retailers’ expansion into Europe. Of the top 50 online retailers in the US, some 19 operate dedicated transactional Web sites for the UK, 14 operate sites for Germany, 12 for France and 14 in Italy. Less than 10 operate eCommerce sites localized for Spain. See the graphic from our recently published Establishing A Global Online Retail Footprint below.

Italy carries weight with US online retailers well beyond its current size or even growth rates. It’s currently the fifth largest online retail market in Europe behind the UK, Germany, France and the Netherlands; its projected growth rate is lower than that in the similarly sized Spanish online retail market.  However, Italy’s large economy (the fourth largest in Europe by a wide margin) and room for online shopping growth -- currently just one-third of online consumers are online buyers -- means it’s an attractive target for eBusinesses looking for long-term growth.

Comments

Why did Amazon wait so long?

Zia

In some ways, I think Amazon, along with eBay and E*Trade, was the archetype of how to establish an eBusiness in multiple markets in the early 2000s. Amazon and eBay steadily established or acquired operations in every large eCommerce market in descending order of size.

If anything, the surprise is that Amazon has taken so long to set up shop in Italy. Although the Italian online retail market is substantially smaller than the French one, eBay set up in Italy as far back as 2001. As you say, it's been a while since Amazon last entered a new country.

It would be intriguing to understand whether Amazon was waiting for eCommerce to reach a certain size in Italy before investing, whether other difficulties delayed this expansion or whether the firm has simply had other priorities in the past few years.

Benjamin

Other sites will likely come much more quickly

Indeed, Amazon has been cautious in its global expansion to date but it sounds like new international sites will come far more quickly than they have in the past. There have been a flurry of articles over the past few days about Amazon's overhaul of its global eCommerce platform - the FT article says Amazon is pulling together a team to build “the architectural underpinnings to greatly simplify country expansions.”

I'd expect a site for Spain to come very soon - there's a limited Spanish-language section of the .com site dedicated to books in Spanish, but nothing yet for Spain or Latin America.