Should I sell on Amazon? This has been a controversial question for many brand owners and managers. Concerns about Amazon’s size and control and a brand’s perceived inability to control the customer experience on the site.
Now the answer to “should this brand be on Amazon?” is unequivocally “yes” given that nearly $4 in every $10 of ecommerce sales occur on Amazon. More and more retail dollars are spent on Amazon. More and more brands are making their way to Amazon. This requires a proactive stance to stand out and succeed.
Big and getting bigger…
With some 300 million users and climbing and in excess of 3 million sellers, Amazon is massive.
55% of users BEGIN THEIR SEARCH on Amazon when shopping online. When a shopper has found the product on an individual retailer’s site, 9 out of 10 will go to check availability and pricing on Amazon.
The acquisition of Whole Foods illustrates Amazon’s trend of pushing downstream toward the customer to provide quality products they want, and get them to their customers faster. For example – Prime members will get access to special incentives in-store and be able to use Whole Foods as a pick up location for deliveries. For Amazon Sellers, this means more ways to differentiate your brand and get in front of motivated customers. This CAN and MUST be managed properly in order to succeed.
Consumer Sentiment….Bargain Hunters vs Luxury Brand Buyers
Gone are the days of excuses such as:
“Oh no – my brand’s value will be erode on a marketplace like Amazon” or
“I don’t think my buyers shop on Amazon,” or
“My brand doesn’t fit with the Amazon marketplace ethos”.
ALL brands, luxury included, need to embrace the Amazon marketplace and be proactive about crafting and controlling their presence there. It will be a crucial component of the brand’s strategy. Adoption among luxury brands is happening, and accelerating.
Underscoring this trend is the fact that Amazon is the largest clothing retailer. Brands that hold out selling there risk the damage done by resellers and unauthorized sellers. Damage such as absence in front of a motivated buyer. Or even LOSS of the motivated buyer due to a substandard experience.
There are many considerations to take into account in terms of how a brand sells (to Amazon vs on Amazon) and how it integrates the Amazon marketplace into its selling strategy, your customers DO shop there and at an increasing rate. Be where your customer is.
Control over your Brand and Products
Take control of selling on Amazon! Don’t give others the chance to resell your products, like fraudulent knockoffs and unauthorized resellers. Large and small brands MUST control who sells their products on Amazon (and other channels), their products descriptions, and their customer service.
This control is about four key areas:
- Brand and product message, including tone and accuracy
- Sellers/distribution
- Control and protect your brand’s integrity
- Control your pricing/margins to ensure sellers are respecting MAP (pricing)
The ability to showcase your brand on Amazon is getting better and better with the ability to provide more detailed product descriptions and have dedicated seller/brand pages via Amazon’s brand registry. While protection of brand integrity is crucial, the Amazon marketplace will also become an extension of a brand’s ability to communicate it’s experience to the customer with these new tools.
Summary
The decision to sell on Amazon should be clear. Amazon represents a significant sales opportunity that one cannot ignore, and also an important component of brand protection, promotion, and customer interaction. Brands need to take control of and manage their presence here. Customers are shopping on Amazon and a successful e-commerce strategy in today’s retail marketplace requires a strong Amazon presence. Amazon has created unprecedented consumer trust and has the customers to prove it. If the marketplace is approached correctly – brands can leverage this moment to succeed on Amazon.
About Channeled
Channeled is a full-service agency that works with companies that are established Amazon sellers or want to launch on Amazon and help them manage and scale.
Our team of marketplace experts drives the strategy, handles execution, provides performance reporting, and deals with all other day-to-day tasks so you have more time to run your business.
Check out this other blog post all about Listing, Optimizing, and Advertising on Amazon.