Introduction: Over the past decade, the global e-commerce landscape has undergone profound transformations. Sales from Chinese sellers on Amazon have skyrocketed, yet the platform now faces intense competition from the "Four Rising Stars" of e-commerce. As new technologies emerge and market strategies evolve, how can Amazon maintain its leadership? Guided by innovation, opportunities, and a focus on localization, Amazon is actively preparing to tackle the future challenges of cross-border e-commerce.
Three Strategic Priorities for 2025: Driving Innovation, Expanding Opportunities, and Empowering Localization
Over the past year, Chinese sellers on Amazon’s global sites achieved a year-on-year sales increase of over 20%. In 2024, Chinese brand sellers reported nearly 30% growth in revenue compared to the previous year.
On December 9, at the 10th Amazon Global Selling Cross-Border E-commerce Summit, Amazon unveiled its 2025 strategic plan, emphasizing three core priorities: Driving Innovation, Expanding Opportunities, and Empowering Localization. Over 30 key initiatives were announced to support these goals.Under the Driving Innovation strategy, Amazon introduced generative AI tools to help sellers improve operational efficiency, optimize product listings, and enhance marketing efforts, ultimately strengthening their competitiveness in global markets. Furthermore, Amazon will launch a series of upgraded supply chain services, including the Amazon Managed Service. This comprehensive, end-to-end cross-border supply chain solution will support Chinese sellers by integrating logistics, warehousing, and distribution, thereby reducing operational costs and management complexities (Figure 1).
In the area of Expanding Opportunities, Amazon plans to open its Ireland site (Amazon.ie) to Chinese sellers in 2025 and accelerate the development of a diversified global site network. By 2025, Amazon expects to have opened a total of 20 international sites to Chinese sellers, creating additional market opportunities and driving business growth.For Empowering Localization, Amazon announced the comprehensive upgrade of its Nanjing office, which will now serve as part of the Yangtze River Delta Cross-Border E-commerce Park located in Jianye District.
Additionally, Amazon recently introduced the Amazon Haul platform, which focuses on low-cost products to meet global consumer demand with competitive pricing and flexible delivery options. Dongguan, a key logistics hub in China, was selected as the pilot city for this initiative, establishing an efficient supply chain from procurement to delivery. Plans are underway to expand the platform to additional markets. Amazon emphasized that offering low-cost products aligns with brand development goals, as sellers can leverage the platform to enter the market and progressively grow into globally competitive brands.
Figure 1: Amazon Supply Chain Comprehensive Solution.Source: Captured by the author during the event
Amazon Global Selling Summit: A Decade of Strategic Evolution
Looking back over the past decade, the Amazon Global Selling Summit has experienced notable strategic changes. From its initial global expansion efforts to its current, more refined approach, Amazon has developed a robust and influential ecosystem (Table 1). Around 2014, Amazon launched its first major push to promote the Global Selling Program, encouraging merchants worldwide to sell through its platform and access global markets. This initiative focused on simplifying the seller onboarding process, optimizing the logistics system, and expanding payment channels. This strategy was not only a significant step for Amazon's entry into international markets but also demonstrated the company's commitment to building a global seller network. By 2017, with the rise of Chinese sellers, Amazon adjusted its strategic focus, dedicating more resources to promoting emerging markets such as China. It also introduced more targeted training programs and support initiatives for these regions. During this period, Amazon significantly increased its investment in platform technology and strengthened its overseas warehousing system, enhancing the competitiveness of sellers in the cross-border e-commerce sector.
By 2020, Amazon advanced its cross-border e-commerce strategy towards greater localization. While continuing to expand its global seller network, the company also placed more emphasis on improving competitiveness in local markets. This included enhancing its global logistics network, strengthening post-sale services, and introducing more flexible platform policies tailored to local needs.At this stage, Amazon’s cross-border e-commerce strategy had matured, evolving from a simple “cross-border selling” model into a multidimensional global e-commerce ecosystem.
Table 1: Ten Years of Strategic Changes at the Amazon Global Selling Summit
China's Cross-Border E-Commerce: A Decade of Transformation and Development
Over the past decade, China's cross-border e-commerce market has undergone significant changes, evolving from initial exploration to its current state of prosperity. This transformation has been driven by a combination of factors, including government policies, technological advancements, market demand, and globalization (Table 2).
Table 2: Ten Years of Policy Changes in China’s Cross-Border E-Commerce Market
In 2014, China’s cross-border e-commerce was still in its infancy. At that time, the cross-border e-commerce model primarily focused on imports, with consumers purchasing overseas products via e-commerce platforms. Domestic cross-border e-commerce companies largely relied on traditional foreign trade channels and B2B transactions, and the market scale was relatively small. While some platforms, such as Alibaba and JD, began testing the waters in overseas markets, the overall market had not yet entered a phase of rapid growth. At the same time, domestic logistics and payment systems had not fully adapted to the demands of cross-border e-commerce, and consumer purchasing behavior remained relatively conservative.
This situation began to shift the following year. In 2015, the government introduced a series of policies aimed at boosting the development of cross-border e-commerce, particularly through the "E-commerce Development Plan (2015-2020)," which explicitly called for the promotion of cross-border e-commerce and the advancement of the "Internet + Foreign Trade" model. These policy initiatives not only created a more favorable environment for cross-border e-commerce but also provided strong support for the rapid development of related businesses. For instance, the relaxation of tax policies for cross-border e-commerce retail imports significantly reduced the cost of bringing overseas products into China, thus gradually lowering the barriers to entry for cross-border e-commerce purchases.
With the support of these policies, the cross-border e-commerce market began to gradually expand. Starting in 2015, more domestic e-commerce platforms entered the cross-border e-commerce space, with platforms such as Alibaba’s AliExpress, JD’s JD International, and Pinduoduo launching cross-border e-commerce services targeting overseas markets. During this period, the reach of cross-border e-commerce gradually extended from large cities to second- and third-tier cities. Through more flexible marketing and supply chain management, cross-border e-commerce platforms successfully cultivated a loyal consumer base, driving further market expansion.
In 2017, cross-border e-commerce reached a significant turning point. The Chinese government further relaxed regulatory policies for cross-border e-commerce, not only increasing support for e-commerce companies but also introducing new regulatory measures. For instance, the new cross-border e-commerce retail import policies were introduced, with more flexible regulations for specific product categories. This made the business model of cross-border e-commerce more standardized, and the market environment gradually stabilized. At the same time, Chinese cross-border e-commerce companies began to focus on building overseas warehousing systems, gradually implementing the emerging "overseas warehouse" model. This model, by establishing warehouses in target markets ahead of time, shortened logistics cycles, improved user experience, and significantly reduced logistics costs for cross-border e-commerce.
Meanwhile, China’s cross-border e-commerce export business also made significant progress. Especially with the support of the "Belt and Road" initiative, more and more Chinese small and medium-sized enterprises (SMEs) began to use e-commerce platforms to expand into overseas markets, gradually forming a strong momentum for cross-border e-commerce exports. Chinese-made products entered many global markets through cross-border e-commerce, especially in emerging markets such as Southeast Asia, Latin America, and the Middle East, where the penetration of Chinese products steadily increased.
In 2020, with global offline retail being disrupted, many traditional retailers were forced to transition online, creating unprecedented growth opportunities for cross-border e-commerce. Chinese cross-border e-commerce companies seized this opportunity to expand their global market coverage further. Chinese merchants' overseas warehousing systems gradually improved, and logistics efficiency and delivery speed significantly increased. This not only effectively reduced transaction costs for cross-border e-commerce but also enhanced the shopping experience for consumers. Today, China has become one of the largest cross-border e-commerce export countries, with cross-border e-commerce serving as a key driver of China’s foreign trade growth (Figures 2 and 3).
Over the past decade, the consumer base for cross-border e-commerce has also changed. Initially centered around price-sensitive consumers, it has gradually shifted towards the mid- to high-end market, which values quality and brand. Chinese cross-border e-commerce platforms have gained global recognition by improving product quality control, strengthening brand development, and offering more personalized products. An increasing number of overseas consumers are choosing Chinese brands, and cross-border e-commerce has become an important channel for Chinese products to "go global."
Figure 2: In the first half of 2024, China's cross-border e-commerce import and export volume reached 1.22 trillion yuan, marking a 10.5% year-on-year growth. According to incomplete statistics, there are currently over 1,000 cross-border e-commerce industrial parks nationwide, more than 2,500 overseas warehouses, and over 120,000 cross-border e-commerce entities across the country.
Figure 3: In terms of global e-commerce market size and market penetration, China leads by a wide margin, with a market size of $3 trillion and a penetration rate of 47%.
Global Cross-Border E-Commerce: A Decade of Evolution and Market Reshaping
Over the past decade, the global cross-border e-commerce market has undergone significant changes. Technological advancements, shifts in consumer behavior, policy adjustments across countries, and changes in the global economic landscape have all contributed to the growth of cross-border e-commerce. From the early days of simple product transactions to the current global e-commerce ecosystem, cross-border e-commerce has continuously evolved.
2014 to 2017: The Initial Surge of Cross-Border E-CommerceAround 2014, cross-border e-commerce was just beginning to emerge globally. While platforms like Amazon and eBay had already engaged in international trade, the overall market size remained relatively small, primarily concentrated among developed countries in Europe and North America. In contrast, cross-border e-commerce markets in regions like Asia, Latin America, and Africa had not fully matured, with challenges such as international logistics, payment systems, and localized services still limiting global e-commerce expansion.
However, as internet access became more widespread and smartphones gained popularity, consumers grew increasingly accustomed to online shopping, creating favorable conditions for the development of cross-border e-commerce. Particularly in emerging markets such as India, Southeast Asia, and Latin America, the rise of young consumer groups generated strong demand for cross-border e-commerce. These consumers sought high-quality foreign products, which cross-border e-commerce was well-positioned to provide.
At the same time, continuous innovation in logistics and payment technologies supported the growth of cross-border e-commerce. Global logistics giants like DHL and FedEx optimized cross-border shipping solutions, reducing transport costs and shortening delivery times. Payment platforms like PayPal and Stripe gradually offered convenient and secure payment methods for global consumers, further promoting the growth of cross-border e-commerce.
During this period, major cross-border e-commerce platforms began to form a competitive landscape. Amazon continued to expand its global reach, particularly enhancing its penetration in non-English-speaking markets through localized strategies in Europe, Asia, and other regions. eBay attracted a large number of small sellers to the cross-border e-commerce market with its widely used auction model. Alibaba's AliExpress began to expand its global influence, particularly in markets like Russia, Eastern Europe, and Latin America, gradually building a large consumer base.
2018 to 2020: Intense Competition and Accelerated GlobalizationIn 2018, the global cross-border e-commerce market entered a new competitive landscape. As the market matured, competition among major platforms intensified. In addition to Amazon, eBay, and Alibaba, new e-commerce platforms and technological innovations began to disrupt the existing market dynamics.
During this period, many emerging platforms and business models began to emerge. For example, the global social commerce model gradually gained traction, with platforms such as Pinduoduo in China, Facebook, and Instagram incorporating social elements into e-commerce, ushering in a new era of social commerce. This trend not only developed rapidly in China but also sparked discussions worldwide about the future of e-commerce models. Increasingly, e-commerce platforms realized that simply selling products was no longer sufficient to meet consumer demands, and social interaction, engagement, and content marketing became essential tools for attracting customers.
Furthermore, the global cross-border e-commerce market faced new challenges. E-commerce companies from emerging markets, such as China and India, continued to rise, gradually establishing a presence in the global market. Chinese cross-border e-commerce platforms, like Alibaba and JD International, expanded their market share in Europe, North America, and other parts of Asia by investing in market expansion and technological innovation. Meanwhile, e-commerce giants from India, such as Flipkart, and from Brazil, such as Mercado Libre, began expanding internationally, leveraging their cost-effective solutions and fast logistics to attract a large consumer base.
As the global economic environment shifted, the international logistics system faced new challenges. The rise of trade protectionism, international policy uncertainty, and the trade tensions between the U.S. and countries like China after 2018 created pressure on the development of cross-border e-commerce. This was particularly challenging for e-commerce platforms reliant on cross-border supply chains, as factors such as tariffs and regulatory policies introduced more obstacles to their international expansion. To overcome these challenges, many cross-border e-commerce companies accelerated their localization strategies, setting up overseas warehouses or adopting more flexible supply chain models to mitigate the negative impacts of trade barriers.
Post-2020: Pandemic-Induced Opportunities, Technological Innovation, and Market AdjustmentsBy 2020, the global cross-border e-commerce market saw unprecedented growth, especially after the outbreak of the COVID-19 pandemic, which made online shopping the new normal for consumers worldwide. Many traditional retailers shifted to online operations, and cross-border e-commerce became a new growth driver (Figure 4). Meanwhile, competition between platforms grew even more intense, with major e-commerce platforms strengthening their global strategies. Services across logistics, payments, and marketing gradually became more internationalized and localized, offering more diversified choices for global cross-border e-commerce.
Additionally, technological innovation played a crucial role during this period. The application of artificial intelligence, big data analytics, and cloud computing enabled cross-border e-commerce platforms to gain a more precise understanding of consumer needs, optimize supply chain management, and improve logistics efficiency. For instance, more platforms leveraged smart recommendation systems and personalized marketing to enhance consumer engagement and provide a more customized shopping experience. Innovations in logistics also saw significant breakthroughs, with the widespread adoption of automated warehousing and unmanned delivery technologies, which further enhanced global e-commerce efficiency.
Figure 4: Global Cross-Border E-commerce Growth from 2021 to 2027
The "Four Little Dragons" of Cross-Border E-commerce and Amazon's Response to Intense Competition
Currently, Amazon remains the global leader in the e-commerce industry, with a broad product range and a well-established logistics system. However, it faces intense competition from the "Four Little Dragons" of Chinese cross-border e-commerce platforms—Temu, SHEIN, AliExpress, and TikTok Shop. These platforms have emerged as direct competitors, particularly in categories like low-priced goods, fashion, and everyday products, posing a significant challenge to Amazon. Amazon's strategic adjustments are becoming increasingly evident as it responds to these emerging competitors. A closer analysis of Amazon's recent strategic moves reveals a series of adjustments across various fronts aimed at countering the growing market competition.
First, Amazon continues to strengthen its core competitive advantages: product diversity and logistics service efficiency. Although platforms such as Temu and SHEIN hold a price advantage, Amazon maintains its leadership by offering a vast selection of products, leveraging its strong brand influence, and relying on its advanced logistics infrastructure. To further solidify this advantage, Amazon has intensified its collaboration with both self-owned products and third-party sellers, optimizing its FBA (Fulfillment by Amazon) logistics services to maintain its edge in the speed competition. By continuously enhancing warehouse capacity and improving delivery efficiency, Amazon continues to attract consumers, particularly in developed markets, where it relies on its mature logistics network to meet the demand for fast and efficient delivery.
Secondly, to address the competition from lower-priced products, Amazon began lowering commissions for certain low-priced product categories in 2023. For instance, the commission for products priced below $15 was reduced from 17% to 5%, while the commission for products priced between $15 and $20 was reduced from 17% to 10%. This strategy aims to lower costs and increase Amazon's competitiveness in low-priced products, directly countering the pressure from platforms like Temu and SHEIN that use subsidies and low-price strategies.
Additionally, Amazon has started optimizing its advertising system by launching more advertising support tools for smaller sellers, especially offering more targeted advertising features and promotional activities for both self-owned and third-party sellers to increase product visibility. Simultaneously, Amazon has made substantial investments in its Prime membership services, providing more attractive value-added services to further solidify its loyal core user base.
In response to the rapid expansion of the "Four Little Dragons" in emerging markets, particularly in Southeast Asia and Latin America, Amazon has accelerated its localization efforts in these regions. It has increased support for local suppliers and enhanced its warehousing and delivery capabilities in these markets. Furthermore, Amazon has strengthened its partnerships with local logistics companies and third-party sellers to improve cross-border logistics efficiency and reduce transportation costs. These initiatives are designed to speed up Amazon’s market penetration in emerging markets while responding to the growing market share of the "Four Little Dragons" in these regions.
It is foreseeable that in the increasingly competitive cross-border e-commerce industry, Amazon will continue to leverage its powerful ecosystem and innovation capabilities, staying ahead of the curve and driving significant changes in the global e-commerce landscape.