The $1.15 billion figure comes from One Click Retail and its Head of Sales and Marketing Nathan Rigby. One Click bills itself as the “industry’s most accurate source of sales data for the world’s top e-commerce marketplaces.”
To get to its figure, it uses a combination of data collected from websites, machine learning and what Rigby called a “network effect” from working with more than “1,000 of the world’s largest brands” to help them understand “the wild world of Amazon.” That includes data on everything from market share, competitive sales, category growth, traffic and conversions, ratings and reviews and pricing analytics.
One Click’s estimate is for mattress, mattress frames and furniture sales only. What’s more, it’s an estimate for first-party sales on the website — or actual topline revenues for Amazon, not the third-party sales, where Amazon would get only a percentage of the sale.
For some time, the e-commerce giant has been developing a multi-pronged strategy to push deeper into the furniture and bedding category. It has created a new selling plan just for furniture stores, encouraging them to get on board the marketplace, set their own pricing and not worry about a past mandate to deliver nationwide. It’s reportedly building warehouses specifically dedicated to furniture and appliance fulfillment. And it has aligned with companies such as Ethan Allen, Cloth & Co. and Benchmade Modern, now selling on Amazon.
And according to one of the latest reports, e-commerce bedding player Tuft & Needle has partnered with Amazon to open 30 co-branded stores (selling Amazon electronics and Tuft & Needle bedding products) across the country.
But when it comes to determining exactly how much Amazon is generating in furniture and mattress sales, the “exactly” part has been difficult to nail down when taking One Click Retail out of the equation. Amazon — all of Amazon — did $136 billion in revenues last year. Estimates for the U.S. home and home furnishings piece range from more than $11 billion from a Morgan Stanley report to $4.31 billion, according to a Citi Research report.
In these reports, home furnishings is defined broadly to include everything from tabletop and accessories to textiles and rugs — all of the less bulky, less damage-prone items Amazon and other e-commerce players have mastered either via drop-ship or fulfillment facilities or both.
The disparity in estimates on Amazon’s larger home business has made the process of estimating furniture and bedding sales that much more difficult. PBM Strategic Insights, the research arm of Furniture Today and Progressive Business Media’s other publications, estimates Amazon’s total U.S. home furnishings sales at $5.03 billion in 2016.
It estimates 10% of those home furnishings sales are in the type of products — furniture and bedding — that would be included in the Top 25 ranking. That equates to about $503 million, which would keep Amazon from making the cut.
A 10% furniture and bedding-only piece of the Morgan Stanley estimate, meanwhile, would place Amazon squarely in the Top 25 with furniture and bedding sales of $1.1 billion, much closer to the One Click Estimate. Meanwhile, the furniture and bedding piece of the Citi Research estimate puts Amazon even further out of reach at $431 million.
Amazon declined to offer guidance for this report. A spokeswoman for the company noted the e-tailer doesn’t provide or substantiate category-specific sales figures.
There is no doubt Amazon has emerged as a top furniture and bedding contender, but exactly how big it is and will be in the furniture space remains a tough call.