Payments

Daily Review: Diving Into the World of Amazon – Recent Milestones from Bezos’s Letter to Shareholders

MEDICIGlobal Head of Content

Amazon continuously awes the world with ambitious goals to build a comprehensive world of consumer and business solutions. Forward-thinking technology company commands its own e-commerce world, rivaling Google in search, and major department chains in retail, among its other massively impactful business units. Amazon Prime counts over 100 million members, generating $9.9 billion for the company without even selling a single product on the platform. For comparison, JPMorgan Chase – the number one most visited bank website with the most mobile banking customers – has 46.7 million digital customers.

Amazon ranked third among the smartest companies of 2017 for creating an AI-powered store of the future with Amazon Go, while expanding intelligent voice assistant Alexa into phones, cars, and more, among other achievements. The number of programs that software developers have published for Alexa reached 12,000.

In his ever-important for a range of industries letters to shareholders, Bezos reveals critical milestones the company passed in 2017. What’s peculiar, is that India takes a special place in his letter.

Pick #1. Bezos’s 2017 Letter to Shareholders – Recent Milestones

Prime

About 13 years post-launch, we have exceeded 100 million paid Prime members globally. In 2017, Amazon shipped more than five billion items with Prime worldwide, and more new members joined Prime than in any previous year. We expanded Prime to Mexico, Singapore, the Netherlands, and Luxembourg, and introduced Business Prime Shipping in the US and Germany.

AWS

It’s exciting to see Amazon Web Services, a 20-billion-dollar revenue run rate business, accelerate its already healthy growth. AWS has also accelerated its pace of innovation – especially in new areas such as machine learning and artificial intelligence, Internet of Things, and serverless computing. In 2017, AWS announced more than 1,400 significant services and features. Tens of thousands of customers are also using a broad range of AWS machine learning services, with active users increasing more than 250% in the last year, spurred by the broad adoption of Amazon SageMaker.

Marketplace

In 2017, for the first time in our history, more than half of the units sold on Amazon worldwide were from our third-party sellers, including small and medium-sized businesses (SMBs). Over 300,000 US-based SMBs started selling on Amazon in 2017, and Fulfillment by Amazon shipped billions of items for SMBs worldwide. Customers ordered more than 40 million items from SMBs worldwide during Prime Day 2017, growing their sales by more than 60% over Prime Day 2016. Our Global Selling program (enabling SMBs to sell products across national borders) grew by over 50% in 2017 and cross-border e-commerce by SMBs now represents more than 25% of total third- party sales.

Alexa

Customer embrace of Alexa continues, with Alexa-enabled devices among the best-selling items across all of Amazon. We’re seeing extremely strong adoption by other companies and developers that want to create their own experiences with Alexa. There are now more than 30,000 skills for Alexa from outside developers, and customers can control more than 4,000 smart home devices from 1,200 unique brands with Alexa.

The foundations of Alexa continue to get smarter every day too. We’ve developed and implemented an on-device fingerprinting technique, which keeps your device from waking up when it hears an Alexa commercial on TV. Far-field speech recognition has improved by 15% over the last year; and in the US, UK, and Germany, we’ve improved Alexa’s spoken language understanding by more than 25% over the last 12 months through enhancements in Alexa’s machine learning components and the use of semi-supervised learning techniques. (These semi-supervised learning techniques reduced the amount of labeled data needed to achieve the same accuracy improvement by 40 times!)

Finally, we’ve dramatically reduced the amount of time required to teach Alexa new languages by using machine translation and transfer learning techniques, which allows us to serve customers in more countries (like India and Japan).

Amazon Go

Amazon Go, a new kind of store with no checkout required, opened to the public in January in Seattle. Since opening, we’ve been thrilled to hear many customers refer to their shopping experience as “magical.” What makes the magic possible is a custom-built combination of computer vision, sensor fusion, and deep learning, which come together to create Just Walk Out shopping. Some of our top-selling items are not surprising – caffeinated beverages and water are popular – but our customers also love the Chicken Banh Mi sandwich, chocolate chip cookies, cut fruit, gummy bears, and our Amazon Meal Kits.

India

Amazon.in is the fastest-growing marketplace in India, and the most visited site on both desktop and mobile, according to comScore and SimilarWeb. The Amazon.in mobile shopping app was also the most downloaded shopping app in India in 2017, according to App Annie. Prime added more members in India in its first year than any previous geography in Amazon’s history. Prime selection in India now includes more than 40 million local products from third-party sellers.

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Pick #2. Izettle Expands from Mobile Payments into E-Commerce & Online Sales for SMBs

iZettle is launching a new e-commerce platform, where customers can build online inventory and check-out experiences either to complement the physical sales they are already making with iZettle itself, or as a standalone service as new customers to the company. The idea is to provide a set of tools to build and run shops quickly and easily for the same kinds of small businesses and sole traders that already use iZettle.

The service is rolling out in Sweden and the UK first, with plans to extend to the rest of iZettle’s footprint in Europe and Latin America over the coming months.

For those who are already iZettle customers and running sales through the company’s platform, they can bring their sales online with one click; all sales across both offline and online will be viewable in a single database.

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Pick #3. Bank of England Makes Transferwise the First Non-Bank to Become Member of Faster Payments

The Bank of England has granted P2P money transfer company TransferWise as the first non-bank payment services provider to hold a settlement account in the Bank of England’s RTGS system, making TransferWise the first non-bank direct member of the Faster Payments Scheme (FPS).

Two million people use TransferWise to transfer more than £1.5 billion ($2.12 billion) every month.

Direct connection to RTGS and the Faster Payments Scheme enables TransferWise to lower processing costs. It also means the company can offer instant transfers to GBP from its borderless accounts and for customers paying by debit and credit card around the world.

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Pick #4. Shift4 Payments Announces Availability of Alipay & Wechat Pay Acceptance for North American Merchants

Shift4 Payments, payment processing solutions provider, and CITCON, cross-border mobile payment company in North America, announced the general availability of their integrated payment solution, which enables Shift4 customers to accept payments via the Alipay and WeChat Pay mobile platforms. Merchants in the US, Canada and the Caribbean can now take advantage of additional revenue streams from consumers visiting from China, who are currently the largest spenders and the fastest-growing traveler segment to North America.

Shift4 Payments processes over 1 billion transactions annually for nearly 200,000 businesses, representing over $100 billion in payments each year. In North America, CITCON is the first and largest authorized merchant acquirer for Alipay and WeChat Pay.

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Pick #5. Santander Launches a Blockchain-Based Foreign Exchange Service That Uses Ripple’s Technology

Santander has launched a foreign exchange service that uses blockchain technology to make same-day international money transfers. The service, called Santander One Pay FX, uses tech developed by blockchain firm Ripple. Santander said it is the first cross-border payments service using blockchain to be made by a bank.

Santander’s blockchain-powered foreign exchange platform is currently live in Spain, UK, Brazil, and Poland. A wider rollout is expected in coming months.

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Pick #6. Alibaba Invests 4.5 Billion Yuan in Online Services Firm to Boost Rural Strategy in China

Alibaba Group has invested 4.5 billion yuan (US$717 million) in a Chinese rural online services platform as part of its continued push to expand business in the country’s rural areas. The investment in Huitongda Network Co, a subsidiary of Jiangsu Five Star Appliances Co, will see both companies work together on supply chain logistics, warehousing, and technology to improve e-commerce infrastructure in rural areas. Alibaba looks to make its rural strategy one of its three core strategic development plans over the next two decades.

As part of its Huitongda partnership, Alibaba also wants to test out its New Retail strategy of integrating online and offline commerce in rural areas. Rural online sales accounted for 17.3% of total e-commerce in China.

Huitongda currently covers over 15,000 towns in 18 provinces, with a network of more than 80,000 stores. It helps offline stores sell goods via e-commerce and also provides infrastructure for e-commerce retailers to sell to rural residents.

Alibaba launched its Rural Taobao strategy in late 2014, providing an e-commerce platform and logistics infrastructure for rural residents to buy and sell items online via Taobao. The company has since set up thousands of service centers to provide e-commerce delivery in rural areas.

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Elena Mesropyan

MEDICIGlobal Head of Content

Global Head of Content, MEDICI

Elena is a research professional with a background in social sciences and extensive experience in consumer behavior studies and marketing analytics. She is passionate about technologies enabling financial inclusion for underprivileged and vulnerable groups of the population around the world.