The case for optimism on Amazon in 2026

Have you heard the idea of choosing a word for the year when thinking about life or business planning? The idea is to choose a word that symbolizes how you want the year to be, and guide your planning and actions as you go through the year.

My word for Amazon this year is strategically optimistic.

While navigating this marketplace is challenging - rising fees, competition, rising CPCs, squeezed margins - it remains an indispensable engine for brands, the largest, most trusted piece of transactional infrastructure in the U.S.

Here are reasons for my optimism for the Amazon opportunity in 2026.

 Amazon’s own moves

Amazon’s own moves matter, because the platform increasingly rewards sellers who align with how Amazon itself is evolving.

Recent announcement of plans to build a 230,000 sq. ft. big-box retail store in Orland Park, Illinois is one of such moves. It will be the biggest physical store presence by Amazon yet. The proposed format is a hybrid retail concept - not a traditional fulfillment center - designed to carry groceries, household goods, and general merchandise.

The company is broadening its approach to what it means to win consumers of staples and everyday goods. Demand for essential products remains strong, and Amazon is building an ecosystem - combining logistics, retail, and digital infrastructure - to capture even more of that demand. It’s not doing that with electronics, soft lines, books, but with consumables and essentials. The infrastructure and access to customers are still growing, creating more opportunities for visibility, engagement, and long-term growth.

Structural advantage 

Even with tougher competition and rising costs, Amazon still offers structural advantages that are hard to replicate elsewhere: a massive customer base through Prime membership, unmatched logistics at scale, and deep customer trust. FBA gives access to Prime customers, and when managed efficiently the lift in conversion and volume outweighs the costs for most consumables sellers.

Lastly - and perhaps most importantly - is the repeat buyer flywheel. I tend to obsess over Subscribe & Save metrics for subscription counts, S&S share of sales, LTV of S&S vs. one time purchases. Subscribe and Save is the closest thing Amazon offers to passive revenue generation. It takes work, but it’s worth it: wIth our clients the lifetime value of a Subscribe & Save customer is often 5X+ that of an average one-time purchaser.

For the categories Grocery leads in Subscribe & Save adoption, followed by Beauty & Personal Care, and then Pet Supplies.

Competition paradox

No one wil argue with the statement of Amazon being a hyper competitive marketplace. Marketplace’s recent article highlighted an interesting take on sellers numbers and their makeup.

Despite fewer new sellers entering the platform and a decline in active seller counts (from about 2.4 million in 2021 to ~1.6 million by the end of 2025) overall third-party gross merchandise volume (GMV) has continued to grow. More importantly, average traffic per active seller has increased by approximately 31% since 2021. In other words, each remaining seller now has more buyer demand available to capture than before.

The era of “anyone can sell on Amazon” is over. The thinning of hobbyist and side-hustle sellers in the middle and lower tiers creates more room for serious operators to win. It also tends to reduce black-hat behavior - experienced businesses don’t build long-term channels that way. If you’ve made it through the last twenty-four months, you’ve already proven you have the resilience to stay in the game.

Personalization for customers and sellers

The more personalized and relevant the data, the better the outcome.

One area where Amazon applies AI most visibly is the shopping experience itself. Product recommendations, search results, and merchandising placements are now heavily AI-driven. By 2026, Amazon’s algorithms have become even more effective at matching customers with products they are likely to buy. Amazon remains relatively quiet about adoption metrics for its Rufus AI shopping assistant, but it’s reasonable to expect that usage will continue to grow.

For brands, personalization increasingly means access to better data. Now we have expanded Brand Analytics, Search Query Performance, category benchmarking, and audience insights in Amazon Marketing Cloud. All are becoming essential tools for understanding brand growth and keyword share within a category, and not flying blind with assumptions. Amazon has also begun populating the Prompts tab in Ads performance reporting. As access to personalized (brand-specific) and contextualized (brand-within-category) data improves, marketing and selling on Amazon become more precise, more effective (mean better ROI), and more interesting.

Another exciting thought for me here is that in 2026, the best way to feed the algorithm is to ensure your product content is thorough: clear titles, strong descriptions with relevant keywords, contextualized visuals, all attributes filled out. When those fundamentals are in place, AI is far more likely to work in your favor by surfacing your products to the right audiences. It becomes a much more brand-centric approach, rather than one focused purely on chasing keywords.

We used to talk about content optimization we mostly meant conversions. But now content optimization also means traffic generation becuase of AI-algorithm scouring the marketplace to bring customers personalized recommendations.

In summary, Amazon’s embrace of AI and tech innovation is creating a more efficient and, shocking to say, seller-friendly environment over time.

The playing field, in many ways, rewards real brand building, innovation, and strong operational efficiency more than it ever has. For those of us who are serious about building durable businesses and performing well over time, that’s actually the most exciting part.

If you are a CPG founder or executive who is ready to capture this "strategically optimistic" opportunity in 2026, I’d love to help you architect that growth. We are in a season where the winners will be those who out-operate the field. Simply reply to this email, and let’s start navigating the year ahead together.

Saludos,

Irina