The e-retailer spends at least 50% of its monthly display ad budget on the highly targeted, data-driven—and often cheap—ad placements using programmatic platforms.
Sales in the U.K. and Japan grew 21.2% and 18.7%, respectively.
Germany is Amazon’s biggest single foreign market, but sales in the United Kingdom grew slightly faster in 2012, according to an analysis of the online retailer’s newly published annual report.
In 2012, Amazon’s Germany sales grew 20.7% to $8.73 billion from $7.23 billion in 2011, compared with sales in the U.K. that grew year over year 21.2% to $6.47 billion from $5.34 billion. In Japan, Amazon, No. 1 in the 2012 Internet Retailer Top 500 in 2012 generated sales of $7.80 billion, up 18.7% from $6.57 billion in 2011.
Total net sales for Amazon reached $61.09 billion, a 27.1% increase from $48.08 billion last year. Of that total North American net sales were $34.81 billion, up 30.4% from $26.70 billion in 2011. North America accounted for 57.0% of sales in 2012, while international net sales totaled $26.28 billion, up 23.0% from $21.37 billion in 2011.
Amazon routinely breaks out overall international sales in its quarterly and annual filings with the U.S. Securities and Exchange Commission. But Amazon for the first time broke out sales for its three single largest foreign markets in a supplementary table its newest annual filing. In 2012, Amazon’s Germany sales accounted for about 33.2% and 14.3%, respectively, of Amazon’s international and total revenue, compared with about 24.6% and 10.6%, respectively, for the U.K. Japan accounted for about 29.7% of Amazon’s international sales in 2012 and 12.8% of total revenue. Collectively, Germany, the U.K. and Japan account for seven-eighths of Amazon’s net sales outside of North America.
Amazon’s sales are growing in key foreign markets because the company continues to build out its overall global growth strategy, which includes taking advantage of its growing global infrastructure and its established brand, says an equity analysts that follows Amazon. “International is a robust area of growth but it’s part of their overall strategy to keep building out their infrastructure,” says Colin Sebastian, an equity analyst who follows Amazon for Robert W. Baird.
Amazon has deep ties to its three biggest foreign markets. Amazon has been selling online in Japan since 2000 and operates 11 fulfillment hubs. In China Amazon has been operational since 2004 when it paid about $75 million to acquire Joyo, an online books retailer. Today Amazon has about 13 distribution centers in China.
Amazon also has a long standing base of operations in Europe. In the U.K. Amazon has been selling since 1998 and currently has eight distribution centers. In Germany, Amazon also has been selling online since 1998 and today operates eight fulfillment hubs in the country
In the 2012 Europe 400 publication, Internet Retailer estimates that Amazon’s sales in Europe in 2011 increased about 38% to $16.71 billion from $12.11 billion in the prior year.