Jump-Start 3P Growth with Amazon Prime

Discover how leveraging Amazon Prime can accelerate your business growth and maximize your brand's sales and visibility.

In the world of e-commerce, Amazon is a titan, providing the dominant marketplace for sellers to reach millions of customers worldwide. However, navigating this expansive opportunity can be a daunting task. Fortunately for sellers, Amazon Prime, with its impressive array of benefits, is a powerful tool that can be leveraged to fuel growth, cultivate customer trust, and build brand loyalty. 

But for novice and experienced sellers alike, the ability to create synergy between Prime eligibility and the rest of a business’s strategic decisions hinges on harnessing these advantages effectively. If you’re currently selling on Amazon or plan to start soon, take the time to discover the full potential of Amazon Prime benefits for your brand. 

The value of Amazon Prime for Sellers

Amazon Prime is more than just a subscription service for consumers; it’s also an invaluable tool for third-party (3P) sellers on Amazon. Prime offers multiple 3P growth strategies, from increased visibility and sales to enhanced customer trust.

One of the most significant advantages of Amazon Prime for 3P sellers is the access to a vast and loyal customer base. With more than 200 million estimated Prime members globally, sellers can reach a massive audience predisposed to buy. Prime members are typically frequent shoppers who spend more on Amazon than non-Prime members. They value Prime’s convenience, speed, and reliability, making them more likely to purchase Prime-eligible products.

Another crucial benefit of Prime for 3P sellers is the Prime Badge. This small logo, displayed next to the product price, signals to customers that Amazon fulfills the order and that it is eligible for Prime benefits such as free two-day shipping. This badge can significantly impact consumer trust in 3P sellers.

In the online shopping world, trust is paramount. Consumers want to feel confident that they will receive their orders promptly and in good condition. The Prime Badge provides this reassurance. It serves as a seal of approval from Amazon, indicating that the seller meets Amazon’s high standards for product quality and fulfillment.

Moreover, the Prime Badge also implies that the seller’s products are likely to be stored in an Amazon warehouse, ready for immediate dispatch. This gives customers confidence that their orders will be delivered quickly, adding to the trust factor.

The psychological impact of the Prime Badge should not be underestimated. Customers who see this badge associate the seller with the reliability and excellent customer service that Amazon is known for. This association can greatly enhance the perceived credibility and reputation of 3P sellers, making customers more comfortable purchasing from them. 

This credibility often influences buying decisions. When faced with similar products from different sellers, customers are likely to choose the one with the Prime Badge due to the trust it engenders and the added benefits it offers, leading to increased sales and profits for 3P sellers.

Overall, Amazon Prime offers immense value to 3P sellers. The access to a large, loyal customer base combined with the trust-enhancing power of the Prime Badge can significantly boost sales and profits, and leveraging these benefits can help 3P sellers effectively compete in the highly competitive Amazon marketplace, build a strong reputation, and achieve long-term success.

Leveraging Amazon Prime starts with FBA

As an Amazon third-party (3P) seller, leveraging Fulfillment by Amazon (FBA) can be instrumental in driving growth and success. FBA is a service provided by Amazon where they take care of storage, packaging, shipping, customer service, and returns for your products. The service simplifies sellers’ logistics and offers several benefits that can boost sales and profits.

One of the primary reasons why growth on Amazon often starts with FBA is the access it provides to Amazon’s Prime members. As mentioned earlier, Prime members are loyal, frequent shoppers who are predisposed to buy. When you use FBA, your products automatically become Prime-eligible, gaining visibility among this vast customer base. At Amify, we often see a 50-100 percent increase in sales when a brand moves to Prime eligibility. 

Comparatively, the seller-fulfilled alternative, where sellers handle their own fulfillment, does not offer the same level of exposure or benefits. It allows a merchant to ship products out of their own warehouse while still qualifying for Amazon Prime, thereby maintaining the ability to sell inventory on direct-to-consumer sites and other marketplaces as well. In addition, sellers avoid the Amazon packaging requirements and can also kit products for convenience.  

However, the downsides include expensive shipping costs to meet the Amazon Prime delivery window and the difficulty of meeting Amazon’s high warehouse and carrier standards. In some cases, businesses utilizing this model will lose their Seller Fulfilled Prime (SFP) capabilities due to a temporary suspension when these standards are not met consistently. The SFP option is also out of reach for many sellers since participation is limited to sellers invited to participate by Amazon.

In addition to the cost-effectiveness, FBA can lead to higher rankings in Amazon’s search results. Amazon’s algorithm favors products that are fulfilled by Amazon and are Prime-eligible, meaning they are likely to appear higher in the search results, leading to increased visibility and potential sales.

Inventory Management is Key

When it comes to inventory management for Prime success, it’s crucial to strike a balance between demand and supply. Overstocking can lead to high storage fees, especially during peak seasons when Amazon increases its storage costs. On the other hand, understocking can result in stockouts, lost sales, and a lower product ranking.

To manage inventory effectively, it’s vital to forecast demand accurately. This involves analyzing historical sales data, considering seasonal trends, and monitoring market changes. Automated inventory management tools can also help by providing real-time inventory updates and alerting you when it’s time to reorder stock.

Another effective strategy is to diversify your inventory. Offering a wide range of products can attract more customers and spread risk. If one product doesn’t sell as expected, others might compensate for it. Moreover, having a diverse product portfolio can increase the chances of cross-selling and upselling, boosting 3P sales.

And remember to regularly audit your inventory to identify slow-moving items that are taking up valuable storage space and costing you money. By promptly identifying and addressing these issues, you can improve your inventory turnover and profitability.

Reach more customers with Amazon Prime Discounts

One of the e-commerce growth tactics that Amazon 3P sellers can leverage with Amazon Prime members is the use of Prime Exclusive Discounts. These discounts are special deals exclusively available to Prime members. They not only attract these frequent shoppers but also incentivize them to make a purchase, thereby boosting 3P sales.

Prime Exclusive Discounts appear with a Prime Deal badge, making them stand out on the product listing page. This increased visibility can lead to higher click-through rates, driving more traffic to the seller’s listings. Moreover, these deals are also featured on the Prime Exclusive Discounts page and in Amazon’s marketing emails, further enhancing their reach and visibility.

In addition to Prime eligibility, Prime Exclusive Discounts are also limited to sellers with a feedback rating of 3.5 or better and require the discounted product to be a new item with a product review rating of 3 stars or higher. While the discount is left up to the seller, it must reduce the price by at least 10 percent to qualify as a Prime Exclusive discount. 

But the benefits of Prime Exclusive Discounts extend beyond just boosting 3P sales. They can also increase customer engagement significantly. When customers see that they are getting a special deal because of their Prime membership, it enhances their perceived value of the membership and their loyalty to Amazon. This increased loyalty can translate into repeat purchases, leading to higher lifetime value for each customer.

These discounts can also help sellers clear out excess inventory more quickly. Sellers can stimulate demand for slow-moving products by offering a Prime Exclusive Discount, improving their inventory turnover.

However, to effectively take advantage of Prime Exclusive Discounts, it’s essential to plan carefully. Sellers need to consider factors such as profitability, competition, and timing when setting up these discounts. They should also monitor their performance closely to understand what works best for their target audience. Sellers may want to consider alternatives, such as an Amazon coupon, to determine the best approach for their needs.

Getting started with Amazon Prime

Utilizing Amazon Prime as a 3P seller begins with setting up an Amazon Seller Account and choosing a selling plan that suits your business needs. To do this, sellers need to provide detailed business information, agree to Amazon’s terms of service, and set up their payment and shipping options.

Once the seller account is created and your products are listed, the most straightforward option to reach Prime Eligibility is to join Fulfillment by Amazon (FBA). While FBA shifts responsibility for fulfillment and customer service to Amazon, sellers should not dismiss their role in driving growth. 

FBA sellers should familiarize themselves with Amazon’s performance metrics and continuously monitor them to ensure they stay within acceptable thresholds. Falling below these thresholds could result in losing Prime eligibility or even suspension from selling on Amazon. That’s why setting up Amazon Brand Analytics for your product is crucial for any seller who wants to succeed on the platform. 

A brand owner must have completed the Amazon Brand Registry process to get started with Amazon Brand Analytics. And unlike creating an Amazon seller account, the good news is that no fee is associated with the Amazon Brand Registry program. Any company that meets the eligibility criteria can join at no cost. 

The Brand Registry program is open to companies with an active trademark from the United States or one of 18 other countries, the United Kingdom, the European Union, or the United Arab Emirates. In some cases, a pending trademark may also be accepted for registration. Beyond meeting the necessary trademark requirements, businesses must also provide any product category they intend to compete in and a list of where their products are manufactured and distributed.

Realizing the Amazon Prime membership impact as a 3P seller involves meeting certain requirements and maintaining high-performance standards. Still, its benefits in increased visibility, customer trust, and sales potential make it a worthwhile endeavor for many sellers.

Make Amify your Prime partner

The experience and expertise of Amify’s team, combined with the benefits of Amazon Prime eligibility, can help your company reach its full potential. 

Schedule your account consultation today and learn what is holding your Amazon business back. Then, let our results-oriented agency create a plan to put your brand back on the right track.

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