By Joanna Perry | Global Head of Marketing

Practicology Amazon AU trading update and our response to temporary changes to FBA in Australia

Practicology – a Pattern company has seen a substantial increase in demand for many of the products we sell on Amazon in the last week. We wanted to provide an update on our experience trading many brands across multiple categories on the marketplace when online channels to market are more crucial than ever to serve consumers.

At the same time, we will explain our response to Amazon’s restrictions on shipments into its warehouses for Fulfilment By Amazon currently in place until April 5th.

In Europe, we are trading on Amazon’s UK, French, German, Spanish and Italian sites; and began to sell products on its new Netherlands site during that week. We continue to see disruption in everyday life caused by COVID-19 and our sales last week tell just some of the story:

  • Our total Amazon Europe unit sales rose by 36% week on week;
  • There were substantial differences in our trading performance by market. All markets saw an increase in units sold, with the smallest weekly unit growth being in Germany (up 14.6%) and the largest being in Italy (up 87.4%);
  • The UK, France & Italy also saw weekly sales revenue rise substantially. In Italy revenue was up by 119% as shoppers turned to the marketplace to access products; the UK also saw strong growth of 48% as people prepare for the next stage of the epidemic;
  • Shopper behaviour on Amazon has been similar to that which we have witnessed in stores. Customers are no longer hesitating about purchases, they’ve moved from browse to buy mode and our conversion rate saw a double-digit increase on the prior week as a result;
  • Our top performing brands were in the vitamins & supplements, pet care and home & kitchen categories.

This epidemic is placing greater emphasis on online channels to reach consumers, as they restrict their activity outside the home and over the coming weeks we expect this shift to online will continue with many sales remaining online afterwards.

Product groups such as medical supplies, grocery, baby, pet care and everyday essentials are growing online as you’d expect however categories such as Home Office, Laptops, Mice, Headphones, USB connectors etc are also increasing where people are preparing to adjust to the next phase of life. Interestingly, sales of refrigeration products have increased as shoppers seek more space to store food at home.

Amazon has announced temporary restrictions on orders from Vendors and Sellers being received into its warehouses in Europe and the USA for Fulfilment by Amazon; as it seeks to prioritise being able to get certain categories of goods to consumers including healthcare, personal care and baby products. Our stock already in Amazon’s European and Australian warehouses is being sold and fulfilled by Amazon as normal and we are not unduly concerned at the moment.

We have stock cover already warehoused with Amazon for many of the items that we sell, and have alternative services to provide fulfilment should the delay on inbound deliveries to Amazon’s warehouses be extended.

Our office-based staff are now all working from home – supported by a fully cloud-based IT infrastructure –  and our warehouses in the UK and Netherlands are currently staffed and operating as normal.

Practicology has received a sharp increase in brands approaching us to help them sell their goods on Amazon, and we are happy to have these discussions and field any questions brands may have as they seek alternative routes to market for their goods.

We believe that we can run commercial analysis and have a brand up and running on the marketplace in as little as six weeks. As this timeframe takes us past Amazon’s current date for restricting inbound deliveries, we would urge brands to begin these conversations as soon as possible to minimise the disruption their business may face from physical stores being closed.

If you need support with your ecommerce sales or digital marketing activity in Australia or elsewhere in the world - or you just want some advice - please don’t hesitate to contact us at hello@practicology.com