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Myths & Misconceptions of Selling on Amazon
Best Practices to Doing it Right
2013
Gina DeFrank Product Manager & Business Analyst, Marketplaces
1. It’s too late to get on Amazon
2. Only Amazon Wins the Buy Box
3. Data Quality Doesn’t Matter
4. It’s too difficult to go International
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Amazon Myths
Myth #1
It’s too late to get on Amazon
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Amazon continues to grow 2-3X e-commerce
Myth #1: It’s too late to get on Amazon
Source: comScore and Amazon public data
Amazon – Estimated $200B by 2017
Poised for continued growth 2-3X E-commerce
Today Amazon has ~40 FCs in 20 states
2017 - 150 FCs in 50 states?
Myth #1: It’s too late to get on Amazon
Source: ChannelAdvisor and Morgan Stanley estimates
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Myth #1: It’s too late to get on Amazon
3PM is growing 2X Amazon Retail
Source: Amazon Public Data
According to Forrester, Amazon is now the place most consumers start their product search.
Morningstar estimates that Amazon Prime membership may be in excess of 10M.
Most categories on Amazon are still open to accepting new sellers.
Amazon is growing at 2X the rate of e-commerce, and expanding globally—the opportunity is there.
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Myth #1: It’s too late to get on Amazon
Myth #2
Only Amazon Wins the Buy Box
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80-90% of sales go to Buy Box owner
To win the Buy Box:
Price
Availability
Performance
Volume
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Myth #2: Only Amazon Wins the Buy Box
• Featured Merchant
• Order Defect Rate (Charge backs, Feedback, A-z Claims)
• Number of products you sell
• Number you have in stock and Quick and Consistent Fulfillment
• Fulfillment Channel FBA • Proximity to the buyer
• Shipping offers
• Most important factor
• Low total price, including product price and shipping cost
Price Availability
Performance Volume
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Amazon: Factors in Winning Buy Box
Consider Product Repricing
Offer Free Shipping
Consider Fulfillment by Amazon (FBA)
Ensure Sufficient Availability
Manage your Seller Performance
Remember: Buy Box Status is Always in Flux!
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Buy Box: Best Practices
Repricer used as a Buy Box strategy
Rules engine designed to automate competitive repricing.
Minimally decrease margin to increase sales
Price up to keep in step with competitors
Amazon: Consider Product Repricing
$197.64
$186.49
X
Fulfillment by Amazon (FBA):
Inventory stored at an Amazon Fulfillment Center.
Picking, Packing & Shipping
Customer Service
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Amazon: Consider FBA
FBA Benefits to Sellers:
Extend reach to Prime Members and Super Saver Shipping Offers
Get Amazon's Customer Service
FBA Product Eligible to win the Buy Box at Higher Price
Increase Profit Margins with a Lower Total Fulfillment Cost
Access to Last-Minute Holiday Shoppers
Easily Access International Customers
Multi-Channel FBA (fulfill for own site, eBay, etc.)
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Amazon: Consider FBA
Amazon: 360 Dashboard
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Sales and Order History
Product Listing Status
Top-performing Products
Seller Reputation
Focus on improving your seller reputation and becoming more successful on Amazon
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Amazon: Manage Seller Performance
Managing Performance: Best Practices
Check your Seller Performance daily!
Order Defect Rate: < 1%
Pre-Fulfillment Cancel Rate: < 2.5%
Late Ship Rate: < 4%
Customer Communication
Answer Questions with 24 hours
Timely Refunds
Address Negative Feedback
Shipping
Ship on Time and with Tracking
Accurate Lead Time to Ship
Myth #3
Data Quality Doesn’t Matter
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A Good Customer Experience starts with Good Product Details
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Amazon: Listings & Data Quality
Images Product
Feedback
Product
Features
Variations
More
Details!
Lots of Data Requirements
Requirements Change
Variation Listing Errors
Matching Amazon’s Catalog
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Amazon: Data Listing Challenges
Listing Relationships (28%)
Insufficient Variation Data
Parent or Child Product not Recognized
Product Matching Errors (16%)
Unable to match to Amazon catalog
Data discrepancies
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Most Common Amazon Errors
Problem:
Not enough product data to properly create a variation (parent/child) relationship between products
Result:
Product listings not properly created on Amazon
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Common Error 1: Variation Errors
Research which variations themes are available for your category
Size, Color, Item Package Quantity
Check that the values sent for the variation data are Amazon Valid Values
Blue not Dark Blue
Ensure child products have a unique variation
Kitchen Aid 5-Quart Mixer, Red
Kitchen Aid 5-Quart Mixer, Blue
Kitchen Aid 5-Quart Mixer, Silver
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Variations: Best Practices
In ChannelAdvisor we use templates and highlight the recommended fields
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Amazon: Templates
To maintain a single product listing, Amazon uses product matching to find and eliminate duplicate products.
Challenge for retailers to match their product up to an Amazon listing.
Common Error #2: Product Matching
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Provide as Much Data as you Can
Unique standard identifiers: ISBN, UPC, or EAN
Include Manufacturer Part Numbers (MPN)
Add Manufacturer or Brand
Category-specific attributes
Do not Re-Use SKUs
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Avoiding Matching Errors: Best Practices
Amazon: Matching Error Resolution
Increase the % of your catalog that is actually listed on Amazon
Used to find the best match for your product when Amazon can’t determine the appropriate catalog match.
Myth #4
It’s too difficult to go International
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Consider Selling in Canada
Consider FBA & Amazon Export
Amazon’s Global Marketplaces
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Amazon: Selling Internationally
Consider selling on Amazon Canada:
#11 Website Traffic in Canada
# 1 E-Commerce site in Canada - bigger than Amazon.com
Programs:
Many Categories
Amazon Prime
FBA in Canada
International Disbursements
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Amazon Canada
Source: Amazon Public data and Alexa data
Products listed on Amazon.com and Products held in FBA
All eligible product listings will be available to International Customers
No extra charge
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Amazon FBA Export
Consider selling in the United Kingdom and in Europe:
Amazon’s European marketplaces had over 164 million active customers last year.
30% of total Amazon units were sold by 3rd party sellers.
Amazon.co.uk receives about 20M unique visitors monthly - Amazon.de has 24M and Amazon.fr has 13M.
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Myth #4: It’s too difficult to go International
Source: Amazon Webinar that sources Amazon Investor Relations
Global Amazon Marketplaces
US Canada
UK France
Germany
Spain
Italy
Japan China
$29.7b 5% of Total
Growth Rate
17%
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2013
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Thank you!
For more information:
1-866-264-8594
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