I resolve to sell my product on Amazon in 2019 – WHERE TO BEGIN [Velocity Amazon Strategy Series]

Author: Christa Klausner

Is launching your product on Amazon on your list of New Year’s resolutions? Or is optimizing your brand’s presence on Amazon part of your 2019 eCommerce road map? If not, it should be.

According to eMarketer, Amazon’s online sales grew nearly 30% in 2018, outpacing total US retail ecommerce’s growth by 16%. What’s more, Amazon took almost half the share of retail ecommerce sales in the US. And 2019 is looking even bigger. Let’s make sure you get a part of that pie.

Success on Amazon is highly dependent upon understanding its inner workings, knowing what they expect from you, properly setting up your internal operations and logistics and strategically leveraging the tools available to vendors and sellers.

In a new series of articles we will be sharing with everyone, we outline various tools, processes and considerations for either launching or optimizing on Amazon.

Where to Begin?

Conducting an audit of your current presence and of the competitive landscape will give you a view into the current situation on the platform and can help identify specific opportunities for launch or optimization.

  • Who is your competition? It might be different than you think.
  • Insight on your competition. Where, what and how they are selling.
  • Current ASIN performance. What areas can immediately be improved?

New to Amazon?

Gathering information from the competitive landscape will help you make important launch decisions once you get a bit further along in the process including. Details including category selection, price, marketing and merchandising, product listings, content, pack types and selling channels, are a few of the important criteria to evaluate when auditing the landscape.

If are you already selling on Amazon…

If you have already launched on Amazon, conducting an Amazon Product HealthScoreTM(PHS) can help identify specific areas to focus on in order to improve your Amazon brand presence, product awareness, traffic and overall conversion. Velocity’sPHS is a proprietary process that takes a quantitative and qualitative analysis of an individual SKU’s health on Amazon. The process analyzes creative, SEO, inventory management, third-party sellers and merchandising & marketing, and assigns a score to each area, on a 5-point scale. The lowest scoring areas identify the immediate areas of opportunity for improvement.

Evaluate CONSTANTLY

Conducting a PHS on a monthly basis can provide an ongoing look at your individual ASINs performance and continuously provide insight for areas for improvement.

Competitive audits should be conducted monthly or quarterly in order to stay on top of the rapidly changing landscape on Amazon.

Velocity Knows Amazon

Velocity currently conducts competitive audits and Amazon Product Health Score for a variety of clients at varying cadence. Please reach out to either Christa Klausner or Rami Odeh so you can learn more about what YOUR health score is.

Amazon Wants to Own Your Home

In the past several years Amazon has moved from your desktop to your mobile to your home speaker to your home broadly and now to your front door. Amazon is buying smart doorbell maker Ring for a reported $1 billion.

The move makes perfect sense as:

  1. Amazon continues to play a massive role in the smart home market and Ring was already integrated as a partner.
  2. Amazon probably arrives at your front door more than any other delivery service or friend or family member, (other than possibly the US Postal Service)
  3. They have already let it know that they want more frictionless entry into your home via Amazon Key for delivery

As Amazon continues their seemingly relentless quest to embed themselves into all the cracks of life, its evident that they are looking to enable everyone to shop as they go through their day, but obstacle-less delivery across the board. So in sum, Amazon has added a key element in the smart home ecosystem and a technology with an installed base that will further accelerate the user satisfaction and growth of their core e-commerce business.

What We Expect to See From Amazon in 2018

At this point, its clear that Amazon has become more than just another e-commerce company that we all shop from. They are also a digital content provider, research destination and marketing channel. And, with their first brick and mortar opening to the public earlier this week, their bigger step into grocery last year and other recent innovations, everyone seems to be watching and wondering what’s next. Based on what we know and are seeing, here’s what we expect from Amazon in 2018: Sensor Replenishment, Voice and Camera-Enabled Machine Learning.

Continued Alexa Growth

Amazon Alexa is growing at a faster rate than any other voice platform. Today Alexa is used mostly for Setting timers, playing songs, reading the news, and shopping.  Shoppers that utilize Alexa purchase 30% more than Prime members that do not utilize alexa, and 70% more than non-Prime members. With this much potential growth, Amazon looks to be doubling down on voice. We expect to see continued aggressive discounting on the device to get the Amazon Echo into more homes and continued improvements and skills.

Amazon Dash Replenishment Program – More Automatic Reordering

Early 2018 Amazon announced that several manufacturers are producing smart products that integrate with Amazon to automatically reorder for consumables when supply runs low. 3M, Blustream, Epson, HP, and Kenmore are some of the key players in this program. It is expected that several more devices will follow suit.

Amazon’s Dash Replenishment leverages multiple sensors to analyze when a consumable is running low inducing a buy order to replenish the product before it runs out.  Printing paper, ink, laundry detergent, and coffee are some of the products that will be available through Amazon’s Dash Replenishment.

Machine Learning Video Camera

Amazon is capturing voice. So, what’s next? View. Amazon has technology that they are releasing to developers to utilize Machine Learning-enabled video cameras. We know Amazon is obsessed with tracking through sensors, and now they will continue to develop on their camera tracking. The next step from here is to follow a similar path to Alexa, where amazon will offer the technology to be included in the manufacturers’ end so they can continue to dominate auto-replenishment and more.

 

Written by: Rami Odeh, TPN VP, Digital Commerce

Amazon: What Does It Take To Win?

For brands today, Amazon.com is no longer just another retailer for selling products. Its a digital content provider, marketing channel, THE retailer and major starting point for all shopping research. 55% of product research leading up to a sale is now conducted on Amazon vs 28% on traditional search engines (BloomReach Survey—Sept. 2016). Because of this, brands can not treat Amazon like any other retailer. They have to take a Amazon-specific approach.

So what does an Amazon-specific approach look like? Well, we can’t give-away all of our knowledge and expertise over a blog post. But, here’s a starting point…

First, to orchestrate a winning plan, you need to start by knowing where you stand. What’s your Amazon.com Product Health Score? Understanding this allows you to build and adjust your actions and determine how to optimize.

Or, if you don’t know your Product Health Score, give us a call. We can help you determine where your product’s overall representation falls on the amazon.com health spectrum. Key elements of this include: evaluating your creative, SEO, inventory, third-party players, merchandising/AMS, and more.

Secondly, you have to build an experience based on the wants and needs of all parties: your target, brands and Amazon.com. That may sound like an simple and obvious thing and in some ways it is. But, if you get it wrong, you can quickly get off course.

YOUR TARGET

Create a plan that will engage your Amazon target in all her retail modes across the customer journey (consumer, shopper, buyer, influencer). Her mindset, behaviors and surroundings change in each so engaging in each will take the right plan.

YOUR BRAND

Understand you brand’s needs and presence on the platform, including your: Brand Position, Reach, PDP Impact, Conversion, Re-marketing, Influence and Overall Product Health.

 

AMAZON.COM

It’s imperative to know where your brand stands on amazon and we are talking about more than just sales – although certainly that is important. Talk to your customers, know how they are using amazon but also look at how they behave. Paint a broad picture that correlates your activities to action. Look at A/B testing, SEO, merchandising, traffic drivers and media segmentation, etc. More than anything, understand what your customer wants from your brand and translate that onto Amazon.com. It’s an environment where you can quickly become commoditized and understanding how it all works together is a full-time job.

Want to know more? Reach out to Joe_Scartz@tpnretail.com

The Amazon Effect on eCommerce and CPG Brands

The use of digital technologies in conjunction with changing shopper behaviors is making eCommerce an indispensable part of CPG omnichannel success. Brands seeking to convert online consumers should focus their attention on convenience, and how important it is in the shopper journey. According to Jennifer Silverberg, CEO of SmartCommerce, “Consumers might not care that something is more expensive, but if they can order it online and they don’t have to go to the store, they will.”

eCommerce and its ease of entry is growing and brands are taking notice. In fact, strong growth is forecast in several eCommerce shopping channels:

  • Computers and consumer electronics total $62.7B in 2017 and that number is expected to hit $97.6B by 2021[statista]
  • Apparel and Accessories eCommerce dollar sales come in at $86B and is expected to reach $96.4B by 2021[statista]
  • Auto and auto parts currently sit at $51.6B with growth projected to reach $57.4B in 2019[statista]
  • U.S. online grocery sales totaled $7B in 2015 and that total is expected to more than double to $18B by 2020[statista]

The biggest driver of eCommerce growth continues to be Amazon.  Amazon’s success isn’t just a byproduct of its huge inventory and rapid service. The online shopping behemoth, according to Yaakov Kimelfeld, Chief Research Officer for Kantar Media, “is not a retailer anymore; it is the largest behavioral marketing company in the world.” Amazon understands shopper motivation not just with purchases but with research. Fifty-five percent of product research that led to a purchase started on Amazon.com compared to 28 percent of the same on search engines. Amazon is now the preferred starting point for product research. How did that happen?

Amazon’s march toward eCommerce preeminence starts with its creative customer service model.  Amazon lives at the perfect intersection between shopper and brand. By understanding shopper behaviors and patterns, they’re able to create actionable plans that can make a more immediate impact for consumers. They’ve also built brand affinity and awareness by positioning brands in the immediate shopper path of purchase. With a heavy focus on the customer, Amazon can optimize constantly, giving their consumers more of what they’re looking for, and driving conversions and shopper loyalty for brands. The shared success model is a driver of Amazon’s eCommerce dominance.

Where does that leave retailers like Walmart?  The shopping giant is responding by spending more on mobile and digital technologies to expand their online shopping capabilities. They’ve strengthened their presence in the eCommerce market with their purchases of men’s internet clothing brand Bonobos, and the innovative online shopping company Jet.com.  Another recent Walmart acquisition is Parcel, a New York-based same-day delivery startup that specializes in perishable grocery delivery, an attempt to leverage the former acquisitions and compete heavily in a market where they have no brick and mortar stores.

CPG brands know that being competitive in today’s convenience shopping environment means the buying process needs to be as painless to the shopper as possible. Luring consumers into buying your product is only half of the equation. Giving them the easiest path to purchase the moment they want to purchase will win the day.

Pinterest: What’s New?

TPN’s Digital Marketing and Commerce team keeps a constant eye on innovation to keep our agency and clients informed. In the latest installment, we dove into new functionalities of Pinterest and how these have helped the platform stay relevant. Watch the TECH DMC minute below.

TechDMC Report 28 August 2017 from TPN on Vimeo.

Big Changes in Ecomm

This morning, Walmart announced a $3.3 billion dollar deal to acquire Jet.com—the highest price ever paid for an eCommerce company. 

Jet.com has quickly become known for “Gamifying Shopping” with its pricing algorithm based on encouraging higher average order value baskets, while producing savings for their customers. However, currently less than 1/3rd of Jet.com’s orders are fulfilled from Jet.com’s warehouses. With Walmart and Jet.com teaming up, Walmart is able to leverage Jet.com’s pricing algorithm while Jet.com will leverage Walmart’s wide fulfillment network. 

With this deal, Walmart discussed its intention to keep Jet.com as its own entity, but it is needless to say that there is going to be plenty of opportunity for data sharing across both unique companies. Strategically, Walmart keeping Jet.com separate from Walmart.com gives Walmart the advantage of using Jet.com as its innovation center and pushing successes to Walmart.com. 

With this deal, Walmart is clearly positioning itself to give Amazon a run for its (well, your) money in the eComm space.

Special Delivery! The Rise of the Box

Special Delivery! Subscription-based retail delights both customers and brands. Customers are often on autopilot when it comes to shopping for their weekly staples. Both traditional brick-and-mortar and online retail giants are great at providing customers easy access to the things that are regularly on their shopping lists.

Shopping, however, isn’t just utilitarian for some. For product junkies, shopping is also about the hunt for new and different products: things you may not have considered or have known about for various reasons. This desire for novelty, combined with personalization and convenience, is the impetus for the growing ecommerce model that is subscription boxes.

These days, it seems like there’s a subscription box for everything. Love make-up? There’s a box for that. Looking to bond with your child? There’s a box for that. Need to tame your beard? There’s a box for that too. There are even services out there that can help others start their own box businesses.

Growing up, one of my favorite shopping experiences was going to the local drug store with my dad, where he’d purchase me a kids “grab bag:” A surprise selection of goodies mysteriously packaged in a brown paper sack. Most of the time, I was delighted by my unforeseen bounty. Sometimes, however, I was just very disappointed.

That is what’s so great about today’s subscription boxes: all of the thrill, none of the fill. What’s not to love about a monthly surprise delivery of goods curated just for you? With an array of products and price points available, customers can easily incorporate both impulse purchasing and trial buying into their budgets. According to one Ipsy subscriber, “I tend to wait for the subscription to come, and generally just buy products I know from my delivery when shopping in-store.”

Customers aren’t the only ones who are benefitting. The box is a subscription-based model, which provides consistent revenue streams, which is–of course–good for business. When retailers focus on single products, sales can fluctuate wildly from month-to-month. By leveraging loyal customers via subscriptions, income becomes steady and predictable. Further, brands partnering with box businesses get their products into the hands of shoppers who otherwise may never have given the product a try.

Retailers such as Target and Amazon are incorporating subscription services into their ecommerce experiences, capitalizing on the convenience that shoppers love about boxes. Independent box businesses continue to grow, however, and until traditional retailers can offer the kind of curated personalization that speaks to these customers, boxes will continue to charm the hearts and wallets of customers around the globe.