Is Amazon E‑Commerce? Marketplace, Retail, and Logistics Explained

You clicked because that question is bugging you: is Amazon e‑commerce? Short answer-yes. But if you stop there, you miss what actually affects your costs, control, shipping speed, taxes, and margins. Amazon is e‑commerce, a marketplace, a first‑party retailer, a logistics network, and even an ads platform. Each part plays by different rules. If you’re shopping from New Zealand (like me in Auckland) or deciding whether to sell on Amazon, the difference is not academic-it’s money, delivery times, and brand equity.

What you’ll get here: a quick, crisp answer; how Amazon’s model works under the hood; decision steps for shoppers and sellers; real‑world scenarios; a practical table; and a cheat sheet plus mini‑FAQ. No fluff-just what helps you act.

TL;DR: Is Amazon e‑commerce?

Yes, Amazon is Amazon e-commerce-but it’s also more than that. It’s:

• A marketplace (you buy from third‑party sellers; Amazon takes a fee and often delivers).
• A retailer (Amazon buys stock wholesale and sells it to you as the merchant of record).
• A logistics network (Fulfillment by Amazon, Delivery Service Partners, sort centers, last mile).
• An ad platform (sellers and brands pay to be seen on search and product pages).
• A cloud company (AWS powers much of the internet-indirect to shopping, but funds innovation).

Why this matters to you:

• If you’re a shopper: who you buy from (Amazon vs. a marketplace seller) changes shipping speed, returns, warranty, and taxes at checkout.
• If you’re a seller: marketplace fees, FBA storage, and ads can eat margins fast if you don’t plan. Your upside is instant traffic and trust.

Jobs to be done (what you likely came for):

• Get a straight answer on what Amazon “is.”
• Understand how Amazon’s marketplace vs. retail sides affect you.
• Decide if Amazon is the right channel (or just one of them) for your product.
• Know how shipping, returns, and taxes work-especially across borders like NZ.
• Avoid common pitfalls: fees, counterfeits, slow delivery, and over‑reliance on one channel.

How Amazon actually works in e‑commerce (buyers, sellers, logistics, ads)

Amazon runs several intertwined engines. Understanding them saves you time and money.

Marketplace vs. Retail

• Marketplace (3P): You buy from a third‑party seller. Amazon hosts the listing, collects payment, and may handle delivery (FBA). The seller pays referral fees and optional FBA and ads. You see “Sold by [Seller Name], Fulfilled by Amazon” or “Ships from and sold by [Seller Name].”
• Retail (1P): You buy from Amazon as the merchant of record. The page says “Ships from and sold by Amazon.” Amazon sets price and inventory. Brands sometimes sell wholesale to Amazon in this model.

Fulfillment and last mile

• FBA (Fulfillment by Amazon): Sellers send stock to Amazon’s warehouses. Amazon stores, picks, packs, ships, and handles many customer inquiries and returns. You pay storage and fulfillment fees. Great for Prime eligibility and fast delivery.
• FBM (Fulfilled by Merchant): Sellers store and ship themselves or through a 3PL. More control, potentially lower fees, but slower shipping unless you’re dialed in.

Ads and visibility

• Sponsored Products, Brands, and Display ads decide who wins the “digital shelf.” If you sell, expect to budget for ads-especially in competitive categories. High organic ranking still matters, driven by conversion rate, price, reviews, and availability.

What Amazon says about itself

In its annual Form 10‑K (filed with the U.S. SEC), Amazon reports net sales in segments like Online stores, Third‑party seller services, Subscription services (e.g., Prime), Advertising services, and AWS. That split is your clue: Amazon’s e‑commerce flywheel is not just transactions; it’s services around them. Citing the Form 10‑K keeps us anchored to Amazon’s own primary disclosures rather than guesses.

New Zealand‑specific context

• There’s no local Amazon.co.nz retail store as of now; Kiwis usually buy from Amazon.com or Amazon.com.au. Many items on Amazon Australia ship to NZ with clear GST at checkout.
• GST on low‑value imported goods: Since 2019, overseas businesses selling to NZ customers must charge 15% GST on goods valued at NZ$1,000 or less when they exceed the NZ$60,000 registration threshold. Amazon collects and remits at checkout for eligible orders. Source: New Zealand Inland Revenue guidance.
• Orders over NZ$1,000 may trigger customs duty and import entry fees. Amazon sometimes takes an “Import Fees Deposit” to cover these. Delivery times vary by seller and service.

Decide: Is Amazon right for you? (simple steps for shoppers and sellers)

For shoppers (especially in NZ)

1. Check who you’re buying from: On the product page, look for “Sold by” and “Fulfilled by.” Prefer Prime‑eligible or “Fulfilled by Amazon” for faster, simpler returns.
2. Check delivery to NZ: Use the address selector to confirm “Deliver to New Zealand” before adding to cart.
3. Scan total cost: Look at shipping, GST, and possible import deposit. Sometimes Amazon AU beats US shipping; sometimes the US selection wins.
4. Read reviews wisely: Sort by “Most recent,” look for photo reviews, and scan the “Customer questions & answers” for sizing and compatibility.
5. Have a returns plan: Read the return window. Cross‑border returns can be slower; “Fulfilled by Amazon” is usually smoother.

For sellers (brand owners and resellers)

1. Map your unit economics: Start with your landed cost per unit (COGS + freight + duties). Subtract referral fee (many categories around 15% per Amazon’s Seller Central fee schedule), FBA fees if used, ads, and VAT/GST where applicable. If you can’t sustain at least a healthy gross margin after ads, pause.
2. Choose fulfillment: FBA for speed and conversion lift; FBM or a 3PL if your product is oversized, seasonal, or margins are thin.
3. Plan for ads: Budget a % of sales for Sponsored Products in launch (often 5-15% to start, then optimize). Tighten keyword targets, kill poor performers weekly.
4. Protect your brand: Enroll in Brand Registry (requirements include a registered trademark). This unlocks A+ Content, Stores, and extra protections.
5. Start small, measure weekly: Launch a core SKU, hit 15-20 quality reviews, dial in price and images, then scale. Track sessions, conversion rate (CVR), buy box %, and contribution margin.

Rule‑of‑thumb decisions

• Launch on Amazon if speed to traffic matters more than owning the customer email.
• Launch on your own site if brand storytelling and LTV (subscriptions, bundles) matter more than immediate sales volume.
• Do both if you can: use Amazon to acquire buyers and your site to educate, build community, and cross‑sell. Keep pricing consistent to avoid channel conflict.

Quick decision tree

• If your product is small, shippable, repeat‑purchase → Amazon + FBA is usually a fit.
• If your product is bulky, custom, or needs configuration → your own site first; test Amazon as a discovery channel.
• If margins are under 40% before fees → be cautious; model FBA and ads carefully.
• If your category is restricted or compliance‑heavy (e.g., medical, batteries) → check Amazon policy first to avoid blocks.

Real‑world examples, scenarios, and a quick comparison table

Buyer scenario (Auckland): I wanted a specific hiking headlamp. Local shops had it, but no stock in my size. On Amazon AU, it was Prime‑eligible with GST included and a clear delivery window. I checked “Sold by” to make sure returns would be easy. It landed in five days with tracking. Worth it.

Seller scenario (natural skincare): A Kiwi brand with strong Instagram buzz listed a hero product on Amazon US. They went FBA, invested in quality images, and started with a lean ad budget. They priced to cover 15% referral + FBA + ~10% ads. After 60 days and 40 reviews, conversion rose, ads got cheaper, and they scaled SKUs. They kept their Shopify site as the “home base” for content and bundles.

What’s happening under the hood: Amazon’s ranking favors in‑stock, competitively priced items with solid conversion and reviews. FBA often boosts delivery speed and conversion, which boosts ranking, which lowers ad cost per sale-a flywheel. The trade‑off is fees and dependence on Amazon’s policies.

Notice how most of Amazon’s e‑commerce revenue runs through “Online stores” and “Third‑party seller services” while advertising amplifies both. The primary source for this framing is Amazon’s own annual 10‑K, which won’t give you every secret, but it does lay out how Amazon classifies the business.

Cheat sheet, pitfalls, and mini‑FAQ

Cheat sheet for shoppers

• Want fast delivery and easy returns? Look for “Fulfilled by Amazon” or Prime badges.
• Buying from NZ? Compare Amazon AU vs US. Check total landed cost (shipping + GST + import fees).
• Unsure about quality? Read photo reviews and recent ones; check the seller’s storefront rating.

Cheat sheet for sellers

• Price to survive fees: referral (~15% typical in many categories), FBA, and ads.
• Images sell: clear main image on white; 6-8 supporting shots; short product video beats walls of text.
• Defend your listing: get Brand Registry, monitor buy box, and use transparency or serialization if counterfeits appear.
• Cash flow: FBA storage spikes during Q4; plan inventory cadence to avoid long‑term storage fees.

Common pitfalls

• Counting revenue, not contribution margin. Ads can inflate top line while profit shrinks.
• Ignoring packaging. Damaged returns kill ratings; invest in right‑size, protective packaging.
• Over‑reliance on one channel. A policy change or suspension can stall your business. Keep a backup (own site, other marketplaces).
• Not localizing. Voltage, sizing, compliance labels, and tax rules differ by country.

Mini‑FAQ

• Is Amazon a marketplace or an e‑commerce company? Both. It sells its own inventory (retail) and hosts third‑party sellers (marketplace), all inside a giant e‑commerce experience.
• Is AWS part of e‑commerce? Not directly for shoppers. It’s Amazon’s cloud arm that supports the company’s finances and speed of innovation.
• Do I need my own website if I sell on Amazon? Strongly recommended. You don’t own customer emails on Amazon. Your site builds retention and brand equity.
• Can I sell on Amazon from New Zealand? Yes, you can create a seller account and sell into target marketplaces (US, AU, etc.). You’ll need to handle tax registration, cross‑border logistics, and product compliance. Start by reading Seller Central’s country‑specific requirements.
• Is it safe to buy electronics on Amazon? Yes-if you vet the seller and check voltage/plug standards. For NZ, confirm compatibility and warranty terms, and prefer “Fulfilled by Amazon.”
• How do returns work across borders? For items fulfilled by Amazon, returns are usually processed through Amazon’s portal with prepaid labels where available. For merchant‑fulfilled imports, expect longer timelines and possible return shipping costs.

Next steps and troubleshooting

If you’re a shopper in NZ

1. Pick Amazon AU as your first search for everyday items; check US for niche products.
2. Add your NZ address first so you only see shippable items.
3. Compare total landed cost vs. local retailers-sometimes your local shop wins on time and warranty.

If you’re a brand testing Amazon

1. Do a 30‑minute margin model: COGS → landed cost → add referral/FBA → add initial ad budget → target price → expected profit per unit.
2. Launch one hero SKU with FBA. Build 6-8 images and a short video. Write scannable bullet points (benefits first, specs second).
3. Run tight ads on exact‑match keywords. Pause losers weekly. Scale winners.
4. Enroll in Brand Registry once your trademark is in place. Move to A+ Content and an Amazon Store.

If things go wrong

• Account or ASIN suspension: Read the performance notification, write a Plan of Action with root cause, corrections, and prevention. Keep it short and specific.
• High return rate: Check reviews for patterns. Fix packaging or product defects. Adjust sizing charts and images.
• Margin squeeze: Re‑price, reduce ad waste, switch from FBA to FBM for oversized items, or bundle to raise AOV.
• Slow NZ delivery: Try Amazon AU, filter for Prime‑eligible or FBA. If it’s still slow, a local retailer might be the better choice for that item.

One last human note: at home in Auckland, Marcus and I split our buys-Amazon AU for specific brands we can’t find quickly, local shops for appliances and anything we might return. That mix keeps our delivery timelines sane and our warranties straightforward. You don’t have to pick a side either. Use Amazon when it fits your job, and use other channels when they serve you better.

Bottom line: Amazon is e‑commerce, yes-but it’s also a marketplace, a retailer, a logistics system, and an ad machine. Knowing which part you’re touching is how you shop smarter and sell profitably.