News & Insights
12 Strategies to Sell More on Amazon
No single Amazon selling strategy will ensure success within the platform’s global marketplace. So while winning the Buy Box is an important piece of the puzzle, it’s only one step. And it doesn’t guarantee your sales will grow moving forward.
Instead, sellers can pursue any number of different strategies in pursuit of the goals. Most of the time, it takes a combination of these tactics to achieve consistent results.
#1 Maximize margins with Seller Central
The most common Amazon partnership, of course, is via a seller relationship with the retail platform. With more than 300 million shoppers worldwide and tens of millions of products, the Amazon marketplace plays an integral role in e-commerce in the United States.
In the Seller Central (3P) model, a brand sells its product directly to the end customer through an Amazon Seller Central account. By avoiding a retailer, brands can realize increased profitability, gain more control over the customer experience, and enjoy increased visibility into data and sales trends. Brands that sell directly in this way typically add a clause to any retailer agreements prohibiting the product from being sold on Amazon by other distributors.
As a 3P seller, brands can maximize their margins and avoid retailer costs. They also enjoy improved control of branding and the customer experience on the Amazon platform while having more access to data, customers and information. However, finding success with this type of 3P model can require an experienced team that understands Amazon optimization. Unfortunately, many brands do not have the internal skills or resources to manage selling on Amazon. In addition, it can be viewed as competition for other retail partners, and a brand may face more risk by having to own inventory until it is sold to the end consumer
In most cases, brands with experience selling directly to consumers and with high-margin products can benefit from opting for this model. These companies can use the valuable data to refine their strategy and will maintain control over their customer-facing interactions. On the other hand, businesses without appropriate margins or the resources to dedicate to Amazon optimization may not be well-served by a 3P model.
#2 Consider Vendor Central
Unique from a traditional Amazon seller account, Amazon’s Vendor Central platform is the interface brands use to sell products directly to Amazon rather than to the consumers shopping in the marketplace. Amazon is then responsible for listing, selling and shipping the products. The Vendor Central model, commonly referred to as first-party or 1P selling, is an opportunity for companies to establish a relationship with Amazon and sell its products at wholesale prices. However, this model is an invite-only program and is usually limited to larger brands with $10M or more in revenue on the Amazon marketplace.
For the few businesses eligible to become Amazon vendors, the 1P option has some attractive advantages. First, it’s easy to understand. Since it’s similar to any other relationship between a vendor and retailer, a brand does not need internal Amazon expertise. It’s also purchase-order based, so the brand receives large purchase orders from Amazon, which then pays for the inventory. Also, as a retailer, Amazon will often accept lower profitability than a 3P seller, as they compete with Walmart and other retailers on price.
The 1P model is often a good fit for low-priced and highly competitive Consumer Packaged Goods (CPG). It can also work well for heavy products with high shipping costs, brands that sell through many distribution channels, and brands that do not attempt to enforce a MAP program. For other brands, the downside of operating with a 1P model can make it a less appealing option than the Amazon Seller Central route. By selling to a retail intermediary, a seller is giving up margin, making 1P far less profitable for premium quality brands in many cases.
It’s also clear that Amazon provides little guidance to its vendors. For example, the platform does not assist in overall strategy, brand positioning, merchandising, or provide technical support. Instead, Amazon simply buys the products. The retailer is also very aggressive at negotiating lower costs from their 1P suppliers by tacking on co-op advertising fees, return fees and chargebacks. And it’s not unusual for Amazon to disregard Minimum Advertised Pricing (MAP) guidelines to sell products for less than a supplier expects
#3 Use Fulfillment by Amazon (FBA)
There are several ways that FBA can help a company sell more efficiently in the Amazon marketplace. It can level the playing field against a brand’s biggest competitors and often improves customer service while minimizing costs. In addition, shifting fulfillment responsibilities to Amazon allows sellers to focus on their true strengths.
One of the most significant advantages is that using Amazon FBA allows the product to be Prime-eligible. Over 100 million American households are Amazon prime members. Prime shipping gives these members two-day shipping across the United States. Customers like this and search for it when buying products on Amazon. At Amify, we often see a 50-100 percent increase in sales when a brand moves to Prime eligibility.
FBA shipping is also dramatically cheaper than other options for most products. Since Amazon is the largest shipper in the U.S., This allows them to have the lowest shipping rates in the country, and luckily they pass these along to FBA customers in the form of low shipping rates. For most products, we find the FBA shipping costs are 30-50 percent cheaper than a brand shipping products themselves (even when comparing two-day shipping on Amazon to five-day for other carriers. This considerable cost difference requires brands that don’t use FBA to either increase its price or be willing to accept much lower (or even negative) margins.
When using FBA, Amazon will also answer most customer service questions and take responsibility for any late-arriving shipments. This allows businesses to focus on making great products rather than responding to “where is my item?” questions all day.
#4 Have a smart pricing plan
Every brand looking to succeed on Amazon should take a deliberate approach to price. As e-commerce continues its rapid growth, pricing policies will become more critical for retailers and manufacturers. Online sales will likely continue their growth trend while consolidating among the largest online retailers, including Amazon. As this happens, the desire of smaller resellers to compete with industry leaders is more likely to lead to destructive price wars for products that aren’t backed by effective pricing strategies.
Implementing effective pricing policies can help companies create mutually-beneficial relationships with retailers and shoppers. Resellers will appreciate the support from the brand that protects their margins. At the same time, consumers will enjoy more confidence in the value of a product and a less frustrating shopping experience due to the consistency across both e-commerce and brick-and-mortar stores. In addition to the positive impacts that a successful Amazon pricing strategy can have on a company’s retailers and customers, there are also substantial benefits for the brand. Prioritizing margins and protecting retailers from price wars increases a brand’s value in several ways.
Minimum Advertised Price (MAP) may not be top of mind for brands, particularly new ones. True to the name, MAP is the minimum price a retailer can advertise for a product they sell. The MAP is set by the brand and should include a margin allowing retailers to profit reasonably. It applies to any retailer who carries the item and is intended to level the competition among sellers and avoid price wars. It differs from the more familiar Manufacturer’s Suggested Retail Price or MSRP, which refers to the amount that a manufacturer thinks a product should sell for. It does not create any restrictions on the advertised price. Brands can use MAP pricing to control the gap between MSRP and advertised prices. In this way, they can avoid the less-than-ideal message that a product is worth substantially lower than what the brand suggests.
#5 Add A+ Content
Amazon A+ Content is your chance to provide fantastic product details for your Amazon product pages and integrate high-quality images, comparison charts, and more. In a world of e-commerce often driven by social media, shoppers now expect this combination of personalized service, captivating content, and a flawless user experience.
Consider A+ Content necessary to showcase your products in the best ways possible. The visuals and copywriting must complement your website and social media in addition to connecting with your customers. Most importantly, you must communicate your product’s unique advantages over the competition and offer customers a satisfying shopping experience that creates loyalty.
Among the most influential pieces of Amazon content are high-quality images and videos. In fact, 78% of people say video has convinced them to buy a product, while 30% of shoppers won’t even consider a product that presents low-quality images. Professionally shot and art-directed photos or videos will help you create visuals that don’t just look good but also help you sell. Showcase your product from multiple angles, add compelling text overlays to relay product benefits and use precise measurements and comparisons to establish its size and function. And remember, nothing packs a storytelling punch quite like video. Done correctly, it has the power to engage your customers and provide information that can minimize confusion and lead to fewer returns and better reviews.
#6 Build a Storefront
Creating an Amazon Storefront is an incredible opportunity to raise brand awareness among Amazon customers, which can lead to more sales. Customers who connect emotionally with a brand name have three times higher lifetime value. And according to Deloitte research, 80 percent of consumers would pay more for products if the company committed itself to being socially responsible, environmentally responsible, and/or paying higher wages.
As the face of your products on Amazon, brand owners should be highly involved with creating their Amazon Store. However, it’s essential to remember that design and branding are skills and not something to take lightly. While Amazon has gone to great lengths to make Storefront creation simple and accessible to any seller via templates and drag-and-drop tools, the task will undoubtedly benefit from a well-devised strategy and an experienced designer.
Amazon Storefronts consist of various pages that feature a brand’s products and organize them in a customer-friendly way. Often, the best Stores will have an engaging homepage highlighting the most popular products, while an intuitive set of sub-pages makes it easy for shoppers to navigate the shop and find exactly what they are looking for.
One of the most critical aspects of an effective Amazon Store is organization. In many cases, the navigation within your storefront should be set up similarly to your direct-to-consumer site, assuming it is already rooted in how consumers shop for your products. We recommend setting up the navigation by need or “job to be done.” This approach prioritizes the perspective of customers who typically shop based on a problem they are trying to solve.
Opt for simple naming conventions for your store’s pages rather than trying to cram descriptive details into each one. Save those long-tail keyword efforts for your product listings. It’s also best to create a minimum of three pages for your Amazon Store. More expansive stores make organizing products in appropriate categories easier and keep shoppers in your brand store longer, often increasing sales per visitor.
#7 Use keyword optimization
Optimization is also not as simple as repeating keywords numerous times. Regarding Amazon’s algorithm and keywords, quality is more important than quantity. In many cases, once a search term appears in your Amazon listing, it has likely added all the value it can. Therefore, adding it repeatedly, especially to the detriment of the copywriting, is unlikely to improve your spot in the search results.
Identifying the primary keywords that are most important to a listing’s performance is typically within a brand’s in-house capabilities. However, prioritizing those terms and effectively integrating them into an Amazon product listing is much more likely to drive your product’s reach and grow sales.
Search engine optimization (SEO) on the platform gauges relevance and value to determine how to best leverage a keyword in a product title, feature bullet points, product description or elsewhere. An effective Amazon SEO plan accounts for both the broadest keywords and the long-tail keywords that help differentiate a brand from its competition and target customers who are closer to the point of purchase. Adding these keywords to engaging copy and taking advantage of Amazon’s backend keyword tools will help your brand to grow its sales on the platform.
#8 Integrate Amazon PPC
Every brand on the platform is looking for new ways to strengthen its Amazon sales. However, while optimization can give sellers the edge when pursuing the top organic search result, it’s not the only path to a better bottom line. Pay-per-click (PPC) Amazon ads can be a more direct way to drive traffic to a product listing or Amazon Storefront. These PPC ads allow e-commerce businesses to break through the immense competition on Amazon and increase their reach. But it requires a solid plan, a broad understanding of the tools available and skilled execution.
For example, a key benefit of Sponsored Display advertising and other types of Amazon PPC advertising lies in the targeting options. Brands can create a targeting strategy based on a similar product or relevant product category or choose to focus on specific types of audiences. This type of product targeting can be helpful when promoting product awareness and attempting to accelerate product discovery. In addition, audience targeting can reach shoppers based on their behaviors and preferences, outside of Amazon by targeting shoppers who have previously viewed relevant products and categories or attempting to introduce an item to new customers who are likely to be interested.
#9 Make the most of your reviews
Obviously, online shopping is more popular than ever, and buyers are extremely savvy about their options. As a result, many view reading product reviews as one of the best ways to inform their purchasing decision. Surveys have shown that nine out of 10 customers read reviews before clicking the buy button, while eight out of 10 give them as much weight as a personal recommendation.
There’s no question that reviews, positive and negative, can impact product sales and conversion metrics. What may not be clear, though, is how the relationship between an Amazon review and sales can begin before a prospective customer even finds your listing. Product reviews on a site like Amazon can impact your organic rank among the search results even before a shopper discovers your product detail page.
While it’s impossible to avoid ever receiving a negative review, there are ways to counter them. Shoppers will give them less weight if they are substantially outnumbered by four and five-star ones. Improved descriptions can also blunt their impact on decision-making if the product’s updated details specifically address the substance of past complaints. A less-than-stellar evaluation can give new customers a reason to hesitate before making purchases. But, it can be incredibly reassuring when you proactively alleviate the concern that an Amazon shopper will have an experience similar to that of an unhappy customer. If you take the time to use any negative reviews to improve your listing or process for the next shopper, your conversion rate will likely rise over time.
#10 Embrace analytics
Whether from Amazon or elsewhere, one of the advantages of e-commerce is the incredible amount of data sellers can access. There’s often an overwhelming number of reports available regarding inventory, shoppers, advertising, buyers and more. But, the most effective sellers will leverage the data to reach more customers and increase conversions.
Remember, it’s not just about monitoring this enormous cache of data. It must also be appropriately analyzed to reveal actionable insights that optimize and grow sales. In particular, an Amazon seller can utilize the platform’s proprietary reports via Seller Central and supplement those metrics with other online store or marketing data to create a fuller picture of a brand’s strengths and weaknesses.
Joining the Amazon Brand Registry, a necessary first step to an Amazon Store, provides access to the Brand Analytics Dashboard. This, and other tools like Store Insights, allows your company to access data that you wouldn’t otherwise be available and have a glimpse into the habits and sales conversions originating from Amazon. Data such as the path your customers take to your listings and the effectiveness of a product listing can help your company evaluate current marketing efforts and provide direction for new initiatives.
#11 Start with realistic expectations
We find that many brands expect huge sales and profitability from the start. We all want our products to be massively successful right out of the gate, but launching an overnight sensation is extremely rare. Instead, it often takes many years to perfect a product and craft an Amazon selling strategy that leads to sustainable growth. Brands need to take a long-term approach to Amazon to make it successful. The market is enormous and highly competitive. Time and patience are necessary as new brands build their reputation against entrenched competitors. The good news is that perseverance does pay off.
Remember, Amazon does not care about your brand. However, it is a business, and the platform wants to make money off your brand. Companies should approach the marketplace knowing that Amazon will not prioritize a seller’s internal profitability levels or provide unique advantages to any brand over its competition. Amazon realizes their customers are probably more loyal to them than most brands selling on the site. If one brand goes away, shoppers are likely to buy from a competitor’s Amazon listing, which has little, if any, impact on Amazon. They still make their cut from the sale. The sooner a brand realizes that Amazon doesn’t care, the better it can build a strategy for growth on the site.
#12 Partner with Amify
At Amify, we have helped premium brands achieve their Amazon goals for over a decade. From Amazon marketing strategy to enhanced brand content, teaming up with us puts world-class, up-to-the-minute platform knowledge on your side. Review our case studies and discover why our clients average 100 percent growth in the first year after partnering with us.
Our industry-leading expertise can unlock the full potential of a product listing, build a branded Amazon store, or determine the best ad spend for your Amazon advertising campaign. If you’re looking for a comprehensive, results-oriented approach to growing your Amazon business, contact us today to learn why so many brand owners choose Amify. You’ll quickly see the results that keep our partnerships growing. From marketing and sales to analysis and logistics, our team is ready to help your company win on Amazon.