How Omni-Channel Brands Can Harness the Power of Amazon

Amazon has long been a large and growing presence in the retail landscape. Its rapid growth continues as Amazon recently cracked the list of top 10 U.S. retail stores. In addition to impressive sales growth Amazon has grown as a product search engine, capturing many more product searches than Google. It is a destination for consumers to research products, read reviews, and compare prices.

The numbers clearly demonstrate that Amazon is a large opportunity for increased sales but an omni-channel marketer at a product brand should have many additional questions: How can I align the customer experience on Amazon with my other channels? How can I coordinate product releases, pricing, photos, copy, and customer communications through Amazon with my central strategy?

When engaged correctly, Amazon is a valuable tool for product brands that want a cohesive omni-channel presence. This article provides product marketers with the tools they need to align Amazon’s amazing selling ability with their omni-channel strategy.

• Amazon’s Threats to an Omni-channel Strategy
• How to Align Amazon with an Omni-channel Strategy
• Amazon’s Limitations

Amazon’s Threats to an Omni-channel Strategy

Because I work with many product brands, I’ve encountered many ways that Amazon poses a threat to a well-conceived, coordinated marketing effort. Here are the most common and most significant.

Pricing violations

A product’s price on Amazon is often cheaper than any other website or retailer. It is so common that many retailers refuse to match Amazon’s pricing. That is a big problem for an omni-channel marketer that is carefully positioning their product in the market. Price is a huge factor when managing your customers’ perceptions of value. There are two reasons that Amazon’s prices are so low.

The first reason, which is widely discussed, is Amazon’s retail division is more than willing to accept razor thin margins. Their low overhead and unlimited shelf space mean that they can afford to price lower than most other retailers. Additionally, Amazon Retail refuses to abide by pricing guidelines so the only solution here is to not sell to Amazon’s retail division.

The second reason is Amazon’s third party marketplace. Anyone can create a selling account with Amazon to sell products and many distributors and small retailers do just that. To manage multiple offers for the same product, Amazon consolidates the offers into one list. The best offer is presented as the default offer and garners 85% of sales. This creates an incredibly strong pressure for each seller to lower their price as much as possible since only the lowest priced offers get significant sales.

If your product sells well and is widely distributed, upwards of 100 different people may be selling your products on Amazon and competing for a low price in an incredibly frictionless environment.

Poor product information

Just as Amazon combines each sellers offer to a single list, Amazon combines all versions of product content on a single listing. Each seller can submit their own title, images, bullets, description, and other details, then Amazon’s automated algorithm picks what it thinks is best. The criteria it uses are not public. In essence, Amazon is crowdsourcing the product information which gives brands very little control over the quality, accuracy, and completeness of their product information on Amazon.

Poor customer communications

Amazon has become the Internet’s main destination for product reviews. In addition, potential customers can ask questions and communicate with sellers about their order. If you aren’t involved in Amazon, all of this communication will not be aligned with your overall messaging and customer care standards. Some customers will be left with inaccurate information or a poor buying experience.

Competitors’ products

If you already knew about the prior threats and made it impossible for your products to appear on Amazon, your strategy has one final threat. Amazon is the largest search engine for products. At least a third of product searches on the Internet start on Amazon so that will include many of your customers. When your product isn’t there, your competitors’ products will appear. Amazon’s product search dominance means that your absence will siphon a portion of your customers to your competitors.

You Can’t Ignore Amazon

All of these threats mean one very important thing for the omni-channel marketer – you must include Amazon in your strategy. If ignored, a significant portion of your customers will experience a sub-optimal buying experience.

How to Align Amazon with an Omni-Channel Strategy

There are two parts to ensuring your customers have a great experience on Amazon: (1) adopt a selective distribution strategy and (2) actively manage the product listings on Amazon.

Selective Distribution

Selective distribution is a strategy that avoids intermediaries (such as distributors) and sells to qualified and approved retailers. This differs from an intensive distribution strategy where a product is sold through many intermediaries to maximize exposure. A selective approach allows a product brand to pick retail outlets that will provide a positive customer experience, agree to pricing guidelines, and agree not to liquidate excess inventory.

This approach is required for controlling pricing on Amazon since even large product companies cannot track the movement of their products through distributors to the eventual retailers. You must know all of the retailers who stock your product and have your pricing agreements in place to prevent Amazon’s prices from harming your value proposition and positioning.

Manage Listings on Amazon

To ensure that product information on Amazon is accurate, you or a close partner must create listings in Seller Central, Amazon’s platform for third-party sellers. This will allow you to enter the correct title, description, bullets, and details of your product. If your product varies by color or size, you can configure those variations.

Use Amazon Brand Registry

Amazon has a program called Brand Registry. This is a way for Amazon to identify one seller account as the authoritative source of content for a brand. Without Brand Registry in place, any other seller’s content will be just as likely to be used as your own. You can learn more details about enrolling to the program here. An important tip I have uncovered as I’ve worked with Brand Registry is that you should get your brand registry application approved before creating listings; otherwise Amazon’s system doesn’t properly adopt the content you submit. For whatever reason the Brand Registry only applies to new listings you create after being approved.

To speed up the process of acquiring brand registry and creating listings, you can work with a company to manage the listings for you. Any seller account can be approved under Brand Registry so it doesn’t have to be your own. If you have a large, dynamic product catalog, an experienced partner will launch the program much more quickly than an internal team learning the guidelines for the first time.

Lastly, for any product listings on Amazon to be visible, you’ll need to actually make inventory available for sale on Amazon. Listings that are out of stock are immediately suppressed from Amazon’s search so even if you enter all your product information to Amazon, your own products must be available for sale.

Manage Customer Communications

Amazon is a great place to monitor feedback from your customers. They can communicate with you about their orders, review the product and ask questions. It helps to engage with customers who write reviews, correct inaccurate information, and answer their questions quickly.

Amazon’s Limitations: It’s Not the Perfect Partner but it’s Pretty Good

While properly engaging with Amazon can help avoid many of the threats to your Omni-channel strategy, it is not a perfect partner for Omni-channel because you have an inherent lack of identifying customer data and control. You can’t collect customer email addresses. You can’t offer subscription plans. You can’t offer digital downloads. You can’t change the layout of the site. However, Amazon still provides a solid platform for describing your product and managing orders that a significant portion of your target market already uses. It is worth the effort to engage.

Amazon is not your friend by default. It’s an ecommerce technology platform that’s available for you to reach your customers, if you’re willing to align it with your omni-channel strategy.