Amazon’s Budget-Friendly Haul Takes on Asian Market: A Thrifty Revolution in E-commerce

Amazon disclosed its expansion plans for its cost-effective e-commerce service, Amazon Bazaar, on a recent Friday. Known in the United States as Haul, the service is now available in 14 new markets, intensifying competition with Chinese counterparts like Shein and PDD Holdings’ Temu in the worldwide race to sell budget-friendly products such as $10 dresses and $5 accessories.

Impact of Import Tariffs

The import tariffs imposed by former U.S. President Donald Trump made a noticeable dent in consumer sentiment, more so among the lower-income groups, who are frequently on the lookout for economical deals.

Amazon Bazaar Versus Amazon Haul

Amazon Bazaar operates through a standalone app, offering merchandise akin to Amazon Haul. The latter is a budget-conscious shopping section within the primary Amazon app, which was launched in the prior year.

Having made its debut in Mexico last year, Amazon Bazaar is set to deliver the majority of its products, priced under $10 and some as low as $2, to its newest markets. These markets span a range of categories, from home goods to fashion, as per the e-commerce behemoth.

Amazon Bazaar’s New Markets

Amazon Bazaar’s low-cost e-commerce service has ventured into newer markets such as Hong Kong, the Philippines, Nigeria, and Taiwan. Following its launch in Mexico, the service expanded to Saudi Arabia and the United Arab Emirates.

DA Davidson & Co analyst Gil Luria highlighted the significance of Amazon Bazaar’s expansion, noting it as a crucial step in Amazon’s international growth strategy. According to Luria, Amazon only ventures into a market if it can scale up to a level that both delights consumers and builds a profitable business.

Luria further mentioned that the company often takes several years to achieve profitability when entering new countries and markets. Amazon recently reported its third-quarter international revenue at $40.9 billion, witnessing a 10% growth from the same period last year, excluding the impact of foreign exchange fluctuations.

Luria also posited that if Amazon can successfully build a business around selling a small selection of inexpensive items with appealing service levels, it could potentially extend its services beyond its core 23 markets to nearly every other country globally.

Global Fulfilment Centers and Service Partners

Amazon stated that products on Amazon Bazaar are shipped directly from the company’s global fulfillment centers to the designated destinations and delivered to customers via its network of service partners.

Expansion of Competitors

Shein and Temu, Amazon’s rivals in the space, have also accelerated their expansion outside the United States. While Shein operates in over 160 countries, including the U.S., Brazil, Ireland, and Southern China, Temu ships to at least 70 countries.

The Launch and Expansion of Amazon Haul

In 2024, Amazon launched Haul in the U.S., which has since expanded the in-app service to Britain, Germany, France, Italy, Spain, Japan, and Australia.

Questions & Answers

What is Amazon Bazaar?
Amazon Bazaar is a low-cost e-commerce service by Amazon, known as Haul in the U.S., which sells a wide range of budget-friendly products.

Which new markets has Amazon Bazaar entered recently?
Amazon Bazaar has recently expanded its services to 14 new markets, including Hong Kong, the Philippines, Nigeria, and Taiwan.

How does Amazon Bazaar operate?
Amazon Bazaar operates through a standalone app and ships products to customers directly from Amazon’s global fulfillment centers via its network of service partners.