INDUSTRY REPORT
2025 Year in Review: Retail Ecommerce Report
Volume growth, profitability pressure
2025 marked a pivotal year for Amazon ecommerce, where growth came at a cost. The equation was simple: brands paid more for each dollar of revenue and kept less of it. Growth remained achievable on Amazon, but only through sharper execution, tighter cost control and a renewed focus on profit over scale.
This 2025 Year in Review report brings total industry and 10 category breakdowns that reflect ecommerce retail in 2025 and insights that set the ground for a strong performance in 2026.
Key takeaways
- Better execution led to higher conversion: Companies focused on improving execution, resulting in an increase in PO Fill Rate 75.1% → 87.5% (+12.4 pp) & Conversion +2.4 pp
- Tariffs eroded pricing power: Companies could not pass on the tariff costs to consumers and ASP fell -4.3% even when discounts fell 21.4% → 17.1% (-4.3 pp)
- Ad costs outpace returns: Competition in paid media rose CPC by +8.4% while ROAS fell by -8.1%
- Profit pressure was inevitable: With prices falling, traffic driving costs up, unit margins inevitably dropped by -2.6 pp
- OOS leakage rose and LBB became a threat: Planning disruptions caused by tariffs and other macro factors rose revenue loss from OOS by +17.9%, & LBB became a problem
- Ad spend peaked mid-year and holiday spend was on trend: Companies spent the most on ads in July and saw their revenues peak in November in line with the holiday spend
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