What Amazon’s Acquisition of Selz Means for E-commerce

What Amazon’s Acquisition of Selz Means for E-commerce

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This past January, Amazon quietly acquired the Australia-based e-commerce platform Selz. Founded in 2013, Selz offers a Shopify-like platform that helps small and medium-sized businesses launch their own online stores and add online payment options to existing websites, among other tools. During the pandemic, as online sales boomed, Amazon has seen its third-party marketplace grow to account for more than half its e-commerce sales. Where does Amazon’s acquisition of Selz fit into this picture and what does it mean for e-commerce generally? To find out, GLG’s Content Manager, Blair Kennedy, recently hosted a teleconference with Stefan Haney, Managing Principal at Vantage International and formerly Director of Consumer Shopping Experience at Amazon. Edited highlights of the discussion follow.

Why do you think Amazon acquired Selz?

We have to remember that Amazon is customer-obsessed, not competitor-obsessed. So they look at what customers are getting from a competitor, and when they looked at Selz, they saw customers engaging with lots of brands in a direct way. In trying to accomplish that, it no doubt became a question of build or buy. In acquiring Selz, Amazon probably saw an opportunity to get a bit of a fast-forward with engineering and technology.

Was this a way to expand in Australia?

Amazon certainly isn’t opposed to expanding its presence in Australia, but I see this more likely as an engineering and capability purchase that will expand what Amazon can offer to all its brand owners around the world.

Why couldn’t Amazon build a Shopify competitor in-house?

Well, there may be some scar tissue there in the form of Amazon’s attempt to build Webstore, which may have been before its time. But acquiring Selz accomplishes a couple of things technologically. It gives Amazon an existing out-of-the-box, configure-your-own website business that is able to sell not only physical products but also digital products. And it connects brand owners in an engagement way. It’s similar to the way Amazon was able to get a jump in robotics when it bought Zappos and the Kiva robots and could expand those capabilities.

There are capabilities within Selz that will allow Amazon to use it as a prototype place or to create an offering very quickly for brand owners. Selz may not be as big as Shopify, but it’s big enough. Amazon, with its experiment-driven culture, could experiment with pricing and different brands’ services. In fact, I could see them maintaining the Selz brand and the Selz offering and experiment before they integrate additional brands. To be sure, Amazon’s advertising technology is well established, but being able to set up the store and configure it quickly is something they get with Selz right out of the box.

At a high level, how does Selz compare with Shopify?

They’re both in the category of what I call headless e-commerce. By that I mean that they provide kind of generic services and the brand owner creates the head to build its presence. Selz, of course, is quite a bit smaller than Shopify, which has been out longer and has a much bigger user base. Shopify also has a richer ecosystem and some fulfillment capabilities they offer to their sellers. Selz has focused a little bit more on brand connection to their customers, specifically with things like digital tails or webinars and capabilities where a brand can go live.

What has changed at Amazon since it shut down Webstore in 2015?

I think it’s a new direction on who the customer is. With Webstore, there was some confusion about whether it was helping e-commerce sellers build their own websites or if it was really a Trojan horse to get them to sell on Amazon and have a website on the side. Selz provides a fresh start.

What pricing strategy or experiments do you think Amazon is likely to pursue?

I would expect Amazon to experiment with simplifying its fee and payment processes for customers who use Selz as well as other Amazon services. They might make it a blended, rather than an a la carte, pricing offering. I also could see Amazon adding into Selz and raising the price. Since Shopify is a couple of hundred dollars a month, there’s some headroom in the marketplace. Amazon typically likes to lower prices for customers, but it also might offer a lot more services for the same value.

Do you think the acquisition could have an impact on Amazon Pay?

It’s still unclear to me if Amazon Pay wants to be Apple Pay when it grows up, or if it wants to be a bit more like Stripe. It’s a positive delight on Shopify when you find yourself in a Shopify store that you’ve never shopped on before and they recognize you as a customer who’s previously shopped with Shopify. So I think there’s an opportunity for Amazon Pay to have native integration and have a very similar feature or maybe even checkout with a common cart across multiple sites. That really opens up an interesting Amazon Pay opportunity.

With everyone seeming to want platformization, are we moving to winner-takes-most markets?

COVID accelerated e-commerce, but we should remember that only a minority of overall shopping occurs online. There’s a lot yet to invent, and I think we’re a long way off from a winner-takes-most. Platformization provides opportunities for people and companies to invest faster, and I think we’ll find that even with having large platforms like Amazon and Shopify there still will be many choices.


About Stefan Haney

Stefan Haney is a business and technology leader with over two decades of experience in e-commerce, software development, and supply chain. As a 15-year veteran of Amazon, with over 9 years at Accenture and internet start-ups, his experience includes building product, data, and engineering teams worldwide to drive innovation and business growth. Stefan is named in multiple patents for algorithms and processes built at Amazon.com after he joined in 2003.


This article is adapted from GLG teleconference transcript.  Please contact us if you would like to view the full text of the teleconference or to talk with Stefan Haney or any of the more than 900,000 experts in the GLG expert pool.