The pandemic is creating opportunities for Amazon rivals, from upstart Shopify to retailers such as Target and Costco
Context & Ripple Effects
This lands mid-rally: e-commerce stocks had already surged in late April on analyst expectations that upcoming earnings would reveal a potentially permanent consumer shift online, and this piece widens the beneficiary list beyond Amazon to Shopify, Target, and Costco. It also builds on the argument that [[a:943729|Shopify's merchant ecosystem and fulfillment network could become the first true Amazon competitor]].
The framing matters because it treats the pandemic not just as an Amazon windfall but as a share-redistribution event — one that later coverage would test hard.
First-order effects
- Target and Costco convert physical stores into fulfillment assets during lockdowns, capturing online demand Amazon can't serve from warehouses alone.
- Shopify gains as merchants pushed out of closed storefronts move direct-to-consumer on its platform rather than into Amazon's marketplace.
Second-order effects
- Amazon faces measurable share erosion: Rakuten data later showed its US e-commerce share falling from 42.1% in January to 38.5% by June while Target's rose from 2.2% to 3.5% and Walmart's from 4.2% to 5% (Rakuten share data).
- Rivals' pandemic-era gains push them into aggressive capacity bets — expansion that [[a:983806|Amazon, Shopify, Wayfair, and others would later unwind after wrongly assuming the online surge was permanent]].
Third-order effects
- If the pattern holds, US e-commerce structurally splits between Amazon's marketplace model and a store-fulfilled/merchant-enabled bloc (Target, Walmart, Costco, Shopify), ending the assumption of inevitable Amazon dominance.
- The 2022 retrenchment shows the deeper lesson: demand shocks get misread as permanent shifts, so pandemic winners carry overbuilt cost structures into the normalization that follows.
The trend: The pandemic is redistributing US e-commerce share away from Amazon toward store-based retailers and merchant platforms — a shift whose permanence, as later scale-backs showed, was far less certain than the 2020 rally assumed.