How to make an eCommerce website like Amazon?
The story of Amazon started back in 1994 in Jeff Bezos’s garage. The marketplace grew rapidly, and in 2018, Amazon capitalization grew to $1 trillion making the company the second most profitable after Apple.
Today, Amazon is considered to be the world’s largest online retailer with more than 300 million monthly active users, and more than 2 million sellers. In 2019, Amazon’s annual net revenue reached $280 billion.
The success of Amazon was notable, and as a result, many startups were inspired to make e-commerce websites like Amazon. But how to do it correctly? Stay with us to learn more tips about core features, challenges, and costs any Amazon-like website requires.
Amazon’s Success Story
Amazon is a great example of how the right strategy and hard work can bring the company a big success. But Amazon didn’t become successful in one day. Nowadays, lots of vendors ask, how to make an ecommerce website like Amazon?
Let’s look at the key milestones of Amazon’s history that led the company to what it is now.
- 1994 – In his garage, Jeff Bezos builds Cadabra.com – the first shop that will be later turned into Amazon.
- 1996 – Amazon continues to grow, hires first employees, and moves into a small warehouse.
- 1997– The company issues its initial public offering (IPO) of stock at $18 per share.
- 2002 – Amazon launches Amazon Web Services (AWS).
- 2005 – The company starts Amazon Prime, the membership program that is popular nowadays for shopping and entertainment.
- 2007 – Amazon launches its Kindle Store – an online ebook eCommerce store, and creates Amazon Pay, a payment processor.
- 2010 – Kindle eBooks sales outnumber the paper books sales.
- 2018 – Amazon buys land for its fleet of cargo jets.
Why Is Amazon So Popular?
Four Principles of Work
From the very beginning, Amazon followed the four principles of work that eventually made the company successful.
These principles consist of caring about the customers before focusing on competitors, desire to invent, commitment to operational excellence, and the ability to think long-term.
In the world of bright and vivid web design, Amazon may look not that innovative, and even a little bit old-fashioned. However, in web design, the platform follows the principles of convenience and user-friendliness. At Amazon, nothing distracts customers while they search and purchase goods.
To make the user experience even friendlier, Amazon focuses on such details as high-quality product photos, the ability to view goods from different angles, detailed and informative descriptions, specifications, and item overviews.
To provide its customers with a seamless shopping experience, Amazon offers multiple payment methods including credit and debit cards such as Visa, MasterCard, American Express, and others. Besides this, the customers can buy gift cards to use for purchases.
Amazon Business Model
1. Selling Fees
Selling fees make up one of the largest revenue streams of Amazon. Currently, this part of Amazon business model includes such fees as:
- Per-item fees that are charged for each product sold.
- Referral fees that are charged from vendors on the product sold.
- Shipping fees that are collected by Amazon. The amount of such fees depends on the product type and category.
- Closing fees that are charged for each sold media item such as books, DVDs, computer games, or software.
Amazon focuses on advertising and provides vendors with an opportunity to use the web app to place their ads on Amazon. Therefore, businesses can increase their sales and attract more customers, while Amazon receives additional revenue.
3. Subscription Fees
Amazon offers its customers an Amazon Prime subscription that provides users with such benefits as free fast shipping, exclusive deals, unlimited reading, media streaming, etc. Judging by the number of services that Amazon provides, it becomes clear that Amazon Prime’s popularity grows significantly each year.
4. Amazon Kindle
Launched in November 2007, Kindle eBooks became so popular that in 2010, the number of eBooks sales outnumbered the sales of traditional paper books. Now, Amazon Kindle eBooks allow customers to buy, download, and read books and other digital media correspondence that can be searched for in the Kindle Store.
5. Amazon Web Services
Besides being the world’s largest retailer, Amazon earns revenue with Amazon Web Services (AWS), an on-demand cloud computing service offered to individuals, companies, and governments. Today, AWS has become one of the core sources of income for Amazon, earning the company a profit of almost $8.4 billion in 2019.
Core Features of an Ecommerce Website Like Amazon
How to make an eCommerce website like Amazon? To create a platform like Amazon, it’s crucial to determine its core features first. At Amazon, there are two main types of users: sellers and buyers. Therefore, it’s worth considering these two types of customers when determining the key features of the future Amazon-like marketplace.
Features For Sellers:
Login and Sign Up
Every new member who wants to sell their products should provide Amazon with information such as name, business address, payment details, and tax information. Information about the products that the business is going to sell on the platform are also required as well.
Amazon Login Feature
After creating a business account, sellers need to have an opportunity to add their products and create listings.
At this point, sellers should be able to create, manage, and edit pages for their products. Users can then search through these listings in order to make their purchases.
Amazon Listings Feature
Notifications allow users to receive all the necessary news and updates related to their accounts and the service in general.
For instance, at Amazon, businesses can receive notifications related to orders, listings, and offers.
In cases of refund requests, claims, or any other emergency situations, the sellers will be notified as well. In general, Amazon notifies its users about any service changes and account activities.
A payment system for the sellers should have such features as a display of all transactions, charge and credit reviews, adjustments, order history, and information about refunds.
Related: How to Choose a Payment Provider for Your Business
Sellers can choose the methods by which they want to ship their goods. At Amazon, there are two options for sellers: they can ship parcels themselves or use the Fulfillment by Amazon feature.
The order management feature allows sellers to work with product orders more effectively. This feature allows businesses to print order packing slips, add product order IDs, and view the details about each shipment. It is also possible to use this page when a vendor needs to contact a buyer.
Ratings and Reviews
This feature allows sellers to manage buyers’ feedback, answer questions, or check their ratings.
At Amazon, sellers can also contact buyers through this feature in order to respond to feedback or request to remove any reviews that might be incorrect.
Amazon Ratings and Reviews feature
The report feature allows sellers to check the reports from the customers, view the details of each report, and sort them by order date.
On this page, the seller can view such order report details as order status and fulfillment status, information about sales channels, and product details.
Features For Buyers:
Login and Sign Up
Registration for buyers is a much simpler process than for sellers.
During the registration process, the customers are only asked to enter their names, email addresses, and passwords. Any additional information such as addresses and payment data is required only if the buyers are actually ready to buy something.
Amazon Sign Up Feature
Buyers should be able to pay conveniently for the products they purchase. There are lots of marketplace payment solutions that help to provide users with a safe and convenient buying experience, such as PayPal, Braintree, Stripe, MANGOPAY, Adyen, and Dwolla.
As for Amazon, the company uses its own online payment processing service, Amazon Pay.
At Amazon, buyers can manage their shipments via the “Your Orders” page. This feature allows tracking orders, checking a delivery timeline, and receiving detailed information about delivery options and the current location of any of their shipments.
At Amazon, the buying management system consists of several options: one-click ordering (“Buy Now” button) or buying goods by adding them to a shopping cart.
The Amazon web app also provides customers with an opportunity to cancel a delivery. It is possible to cancel orders that haven’t been shipped, to not accept shipped orders, or cancel them.
The Messaging system allows customers to contact the sellers in order to learn more about the product or ask any other related questions.
Also, this feature can be used as a way of communication between buyers – for example, the buyer can ask questions about a product to others who already bought it.
Amazon Messaging Feature
Ratings and Reviews
The review and rating system is a common feature for most marketplaces. Buyers should be able to add reviews about purchased items in order to help others to decide what to buy. The rating system also helps businesses to earn trust and attract more buyers to the service.
Amazon Ratings and Reviews Feature
As well as sellers, buyers can receive service notifications. At Amazon, these notifications are related to the customers’ orders, shipment statuses, and payments.
Amazon Notifications Feature
The support feature is helpful for both buyers and sellers: it allows users to file complaints, ask questions, and contact website staff. At Amazon, the support page contains a list of the most frequently asked questions (FAQ) and the answers to them.
In case a user doesn’t find a way to resolve their issues on the platform, there is an option to contact a support team by email, phone, or chat.
Amazon Customer Support Feature
The wishlist feature allows buyers to create listings that contain products that they would like to buy later. This feature provides customers with information about all wishlist items, allowing them to manage item quantity or delete items. On this page, buyers can also check the order subtotal and proceed to checkout.
Amazon Wishlist Feature
This feature allows buyers to dispute the services offered by sellers. For example, such disputes may arise due to situations when a buyer doesn’t receive ordered goods.
How to Make a Website Like Amazon: Key Steps
How to make an ecommerce website like Amazon? The Discovery phase helps to evaluate the client’s ideas. During the discovery stage, it is necessary to analyze the market and study the product’s target audience. In addition, a good discovery phase includes a unique value proposition (UVP) and roadmap development. The discovery phase helps to define requirements, choose an appropriate technology stack, determine the core features, and create an MVP scope estimation to start a business like Amazon.
UX Concept Creation
The UX concept creation is all about how the future product will work, look, and whether it will be convenient for customers to use. As a result, the UX concept may be represented as wireframes of the future product.
Choosing the Tech Stack
After the team determines all the core features (that were chosen during the discovery stage) it becomes possible to choose technologies that would work best for its implementation. The tech stack choice usually depends on the budget, time, and complexity of features.
The architecture development stage includes back-end and front-end development, UI/UX design, and testing. Once the product is launched, we prefer to continue maintaining it to ensure that everything is working as was planned.
Challenges of E-commerce Platforms Like Amazon
It may be a challenging task to create an online marketplace like Amazon. However, it’s easy to prepare: take a look at the most common challenges horizontal marketplaces usually face.
Amazon is a horizontal type of marketplace: the service sells all types of products to everyone. Apart from Amazon, there are several large companies using a horizontal organizational model: eBay, Walmart, and Alibaba. All these marketplaces have a huge and loyal audience of users, which results in strong market competition.
For Amazon, the logistics and supply chain are some of the core factors of success. It is necessary to pay particular attention to the logistics, even before the startup architecture development process begins, and to think through how exactly the goods will be delivered. This can prevent future issues and delays.
As a service that sells everything, Amazon-like marketplaces often lower their prices to create a competitive advantage and attract more customers.
However, there’s a huge challenge: how to make prices low and yet stay profitable? The answer to this question is a dynamic pricing algorithm that helps to create a perfect price based on competitors’ prices, supply, seasonality, and demand.
As a result, goods won’t be always cheaper than at competitor marketplaces, prices will stay attractive for customers, and the sales will remain profitable.
Driving the Audience to Buy
When building horizontal marketplaces, it’s crucial to drive the audience to the service. As we already mentioned, the competition in horizontal marketplaces is huge, and it is necessary to consider how to encourage customers to buy from you.
For example, it is possible to focus on some niche products at first. Or, like Amazon did, to start purchasing products with huge discounts and arrange free delivery.
Such a strategy may not bring a large revenue right away, but it helps to attract the first customers to allow the service to grow and fight the competition.
Diversity of Targets
As a marketplace that sells everything to everyone, an Amazon-like platform may have difficulties with identifying the target groups of customers and creating value propositions for them.
How to make an ecommerce website like Amazon? At the start, we advise defining your largest targeted group. Then it will be possible to divide it into smaller segments. At Amazon, the core groups of customers are divided by geographic, demographic, behavioral, and psychographic segments.
How Much Does It Cost to Build a Website Like Amazon?
The cost to create a website like Amazon may vary in accordance with the scope of work, technology complexity, and location. However, in some countries, the prices for web architecture development remain low. Among such regions are Eastern Europe ($25 to $50/hour), Latin America ($10 to $25/hour), and Asia (from $25/hour).
An average MVP development takes 3 to 6 months:
- Project management – 400-800 hours.
- Business analysis – 430-830 hours.
- UX/UI design – 1200-1600 hours.
- Quality Assurance – 500-1200 hours.
- Frontend development – 1200-2500 hours.
- Backend development – 1900-3100 hours.
Therefore, a small and simple custom MVP will cost around $20.000-30.000 and will include such must-have features as:
- Adding goods feature (for sellers)
- Search and buy feature (for buyers)
- Admin Management panel (for admins)
- Payment system integration
- Messaging system (for buyers and sellers)
Veeqo is an omnichannel retail platform for various merchants. With Veeqo, customers are able to manage orders using multiple channels and keep track of inventory from multiple warehouses.
When we first met Veeqo, they needed to expand their team. Our main goal was to create user profiles in the retailers’ system, add orders, and generate invoices.
In brief, Sloboda Studio’s team was responsible for the development of the client-side user interface. We also started the integration of React (as a front-end solution) and Stripe (as a payment system) to make it easier to manage and maintain the product. We also connected AWS Lambda to unload Veeqo’s servers.
Fashion Marketplace is a project dedicated to selling goods that are related to fashion – clothing, shoes, and accessories. When we met our clients, they needed to create a startup marketplace MVP from scratch.
During the production process, Sloboda Studio determined and implemented core features such as:
- Payout system
- Order management & fulfillment
- Statistics and reports
- Promotions and catalog management
- Wishlists & favorites
- One-page checkout
To make the final product more user-friendly, we also included multilingual support and customer support virtual desk.
So how to make an ecommerce website like Amazon? Creating a service like Amazon from scratch may seem a challenging task. However, great things are not made in one day. When you build a horizontal marketplace like Amazon, consider starting with the discovery phase and core features implementation.
The Discovery phase is needed to help with determining the core competitors, choosing the niche, technologies, and key features, and making the plan of the development process, and starting a company like Amazon.
MVP development is the process that is dedicated to core features implementation. For Amazon-like services, these features comprise features for sellers and buyers.
Features for sellers:
- Payment system
- Shipping management
- Order management
Features for buyers:
- Payment system
- Shipping management
- Buying management
- Customer support
Still, have questions on how to make a website like Amazon? At Sloboda Studio, we have been developing, launching, and supporting businesses for 10 years. Feel free to reach out for a consultation.