The Great Compression: 2025 Year in Review This year wasn't defined by a single crisis. It was defined by sustained pressure from multiple directions. Five forces simultaneously compressed seller margins, yet paradoxically created the conditions for decompression in 2026.

The structural question: OpenAI states, "ads do not influence the answers ChatGPT gives you." If maintained, this differentiates from search-based marketplaces where organic visibility declined as paid placements consumed screen space. Full analysis:

The scale remains modest, but early data shows acceleration: Northbeam tracked AI search traffic growing 15x in 2025 (0.01% to 0.15%). Conservative assumptions put ChatGPT's potential GMV at ~$5.5B - half of Etsy's global marketplace, but <1% of Amazon's estimated $575B 3P GMV.

ChatGPT's 4% referral fee (per @theinformation) marks a significant step for conversational commerce, moving from concept to concrete marketplace economics. It's below Amazon (15%), Walmart (6-15%), TikTok Shop (8%), and Etsy (6.5%). Critically, no forced advertising spend.

The registration data isn't signaling Amazon's weakness. It's confirming its evolution into infrastructure that demands professional operation from the outset. Full analysis:

2025's margin compression forces all but eliminated the middle ground — casual, part-time selling is increasingly unviable. But for sophisticated operators with capital reserves and operational expertise, numerical competition has declined while addressable market has grown.

Despite registration decline and active sellers dropping 30%, opportunity per seller has expanded. GMV grew. Traffic per seller increased 31%. Revenue is concentrating among operators who can master advertising, absorb fee increases, and navigate tariff chaos simultaneously.

165,000 new sellers registered on Amazon .com in 2025. The lowest number in a decade. The conventional take: Amazon is struggling to attract sellers. The reality: the marketplace has fundamentally transformed.

Read more in the eighth edition of the Marketplace Pulse Year in Review: https://t.co/D9AzNiDQth

The Decompression: → China's tax enforcement potentially delivering parity → ChatGPT threatening Amazon's $60B+ ad business → Audience-first brands hitting $1B+ valuations, avoiding the marketplace ad tax Whether these forces reshape e-commerce is 2026's defining question.

The Compression: → Tariffs created chaos (no behavior change) → AI raised competitive baselines → Advertising became unavoidable → Platforms extracted maximum value → Chinese sellers hit 50% of Amazon globally

External shocks now produce more noise rather than major structural shifts. The decade of volatility is over, and this is what sustainable e-commerce growth looks like. Read more:

The past decade brought volatile inflections: - 2017's mobile breakthrough (+50-91% growth) - 2020's pandemic surge - 2021's supply chain collapse Each seemed like a defining moment. But, since 2022, growth has stabilized at 5-8% annually. E-commerce has reached equilibrium.

Widespread predictions of tariff-disrupted holiday sales have, so far, proven unfounded. Cyber Monday: $14.25B (+7.1%). Black Friday: $11.8B (+9.1%). Despite unprecedented tariff escalation, consumer spending remained consistent. The absence of drama is itself the story.

Bloomberg reports sellers aligning filings with platform data may face back taxes that "wipe out profit margins." Tax parity may finally arrive - though through Beijing's fiscal priorities, not Washington's trade policy. https://t.co/6D9b8OR3Js

Hong Kong offers territorial taxation and lower rates vs. China's 25% tax on worldwide income. But Chinese tax law allows authorities to claim jurisdiction over Hong Kong companies if operations remain in mainland China. The escape route may be narrower than sellers expect.

780 Chinese sellers changed their Amazon legal entity to Hong Kong in November alone. Throughout 2024, monthly relocations stayed in single digits. Then China mandated that Amazon report quarterly seller revenue data, and the exodus began.

For 200,000+ active sellers, the math is simple: when ads grow 6x faster than sales, you're paying more for the same visibility. Walmart isn't the lower-cost alternative anymore. It's following Amazon's playbook, and the cost gap is closing. Read more:

In 2019, Walmart's e-commerce chief drew a line: "We don't sell the No. 1, 2 slots in search — like some of our competitors do." Today, Walmart search results are indistinguishable from Amazon's. 12 sponsored placements in the first 20 results vs. Amazon's 13.

Walmart's U.S. advertising business grew 33% last quarter. Its U.S. retail sales? 5%. This 6x gap isn't new. Advertising has outpaced sales growth every single quarter for three years straight. 🧵