By Sam Gaunt | Marketing Manager

Our recent Amazon Trading Excellence breakfast event saw us give key recommendations for retailers and brands, based on iServe’s experiences as a top 3 seller on Amazon.com.

Garrett Bluhm, VP of Ecommerce, Marketplace Strategy at iServe joined Practicology CEO Chris Vincent to share expertise on how US brands are adjusting their strategies to improve their visibility and brand perception on Amazon.

Amazon’s 49% share of online sales in the USA means that it has both tremendous power, but also market share to defend; and describes itself as a “price follower”. Bluhm warned that, in practice, this means US brands in certain categories are struggling to be profitable when selling via Vendor Central on Amazon.com.

He advised European brands in the room on how to take control of their destiny, and increase their Amazon sales and margins achieved with a focus on brand protection.

Should my brand sell on Amazon?

Brands often question whether they should sell on Amazon at all, with concerns about comprises to brand equity and cannibalisation of sales from other channels. 

In response, Bluhm warned that if a brand chooses not to sell on Amazon – either directly or through an authorised third-party reseller such as iServe – then they ultimately lose control of their brand image on the marketplace, as third parties will likely still try to sell their products.

Once you establish this brand presence, however, it is then critical to optimise your product listings and brand content, and develop Amazon SEO and advertising strategies to ensure that you have great visibility and own the Amazon Buy Box for your products.

All but the largest brand owners selling directly to Amazon via Vendor Central are essentially using a self-service platform – with little support from Amazon’s vendor managers. Unlike selling to retailers, there is much less opportunity to use an account manager to develop a relationship with the platform.

To deal with this, Bluhm recommended that brands structure their Amazon team in the way they would for other self-service platforms – such as Google for digital marketing – with experts in each area.

What does Amazon trading excellence look like?

Once you have an Amazon presence, Bluhm advises optimising your product listings to be best in class before investing in paid marketing. IServe is achieving 70% year-on-year growth for brands that it sells on Amazon with a relentless focus on SEO, including product titles, descriptions, photography and brand imagery, as well as A+ content to position the brands it sells. 

Marketing strategies should blend both on-platform Amazon marketing and off-platform marketing (such as Google pay per click ads) to drive traffic to your products. With search results pages on certain keywords dominated by sponsored listings and Amazon products (pictured below), a paid campaign strategy on Amazon should incorporate four principles Bluhm gives the acronym CABN:

  • Competitive bidding;
  • Using the Automatic bidding tools;
  • Targeting Branded keywords;
  • Also running campaigns on Non-branded keywords.

Due to sky-rocketing Amazon ad costs, driving customers from Google, YouTube and social media using off-platform tactics represents a significant opportunity for savvy marketers. 

IServe does a lot of work around marketing attribution, and Bluhm says the additional sales that it can attribute to Amazon marketing can be significantly lower than that which Amazon attributes. This can be partly because bidding on your brand term is a defensive play, and brands would likely win these sales anyway without paid marketing positions.

Still, he recommends that brands spend a minimum of 1.5% of Amazon sales total on on-platform advertising, though this may need to be considerably higher in certain product categories.

Amazon advertising example.jpg

The struggle with third-party sellers and ‘black hat’ behaviour

In the USA, it is possible to close down unauthorised third-party sellers who do not adhere to minimum pricing policies or distribution policies. This is not an option within the EU and other jurisdictions, but it is still possible to enforce selective distribution for online sellers if they are not adhering to quality policies designed to protect the brand image.

Bluhm also highlighted some of the ‘black hat’ behaviour US brands are facing from rogue sellers. This includes making vexatious complaints about products, leaving negative reviews or encouraging their customers to, and even hijacking listings with product images or links that aren’t relevant to the product being sold.

Brands must be vigilant against this behaviour as your products may temporarily be delisted from Amazon at key trading times, resulting in lost sales.

What role should my Direct to Consumer site play?

Despite the continued growth of Amazon’s model across the world, Bluhm was confident that D2C brand websites still had a valuable role to play.

Through a D2C site, a brand has full access to all its sales data providing a much clearer understanding of its customers than Amazon can provide. Also, the D2C site offers brands the opportunity to create more value for their customers with product guides, rich content and bespoke offers and gifts. As a result, visitors to the D2C site have a much higher intention to buy than when on Amazon.

Bluhm recommends that brands seek a symbiotic relationship between Amazon and D2C, complementing rather than competing with one another. With many product categories, especially higher value items, customers will often find a product on Amazon but then conduct more in-depth research on the D2C site, before completing the purchase back on Amazon. Brands should recognise this behaviour and tailor their D2C site accordingly.

If you need help defining your Amazon strategy, or would like to find out more about the services that iServe offer to global brands, please contact us.
 

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