1. A steady growing marketplace during difficult times.
Amazon has been adding more warehouses and hiring more employees worldwide to be able to supply its products´ demand. With COVID 19 taking over since 2020, Amazon has been key for many people´s survival through pandemic. Some of the main changes Amazon has develop to face pandemic have been to optimize their supply chain for Fulfillment by Amazon (FBA), increasing available storage space by opening dozens of warehouses and expanding products´ offer so customers don´t expose themselves with physical purchases.
“All along the way there are more than 800,000 people making sure we get deliveries to customers on time. We hired nearly 175,000 new people in the U.S. alone to help keep our services running during the pandemic “.
(MacDougall, 2020)
Facing the new reality without Amazon would have been a completely different story for US citizens. Even with pandemic being over, people are now used to buy online and will continue to do so from now on.
2. Customer obsession.
Amazon makes sure that the saying “The customer is always right” truly means something in their business decisions. Most of Amazon operations are thought and optimized from the customer´s perspective. Here´s how Amazon describe their main principle of Customer Obsession:
“Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers” .
(Amazon, 2020)
That´s why Amazon is always looking to increase their products´ offer so their customers can find anything their looking for in Amazon.com. If you have good quality and price competitive products, Amazon is the place to sell them.
“The e-commerce giant, with its seemingly endless selection and drive to deliver convenience and low prices, became the default retailer and an essential service for many consumers at the height of the coronavirus crisis”.
(Palmer, 2020)
According to Oberlo´s blog, trust in Amazon increases by day. Based on a survey they studied for more than 2000 US customers, 89% of buyers prefer Amazon over other ecommerce sites.
It´s especially important to mention how important it is for Amazon to keep their customer´s information confidential. Part of this trust has also been granted after meeting customers´ expectations. Forbes shared this thought in their website:
“Amazon has earned our trust by delivering the products we want, on time, intact, in the same branded brown boxes—consistently.
By offering accurate product suggestions online, Amazon became a reliable advisor. By surfacing credible reviews from our peers, Amazon gives us peace of mind during our purchasing decisions. From convenience to price, product selection and overall experience, Amazon has mastered the customer relationship. In doing so, it has set up a new type of interaction model for consumers.”.
(Forbes, 2017)
Having offers in Amazon gives you immediate trust from customers on your brand and your business in general. It´s a great opportunity to reach more and more buyers every day.
3. Prime Membership increasing
Becoming a Primer member grants you plenty of benefits while navigating and buying in Amazon.com with a fee of $119 (plus taxes) a year. Some of the benefits they mention in their official website and that are considered more attractive for customers are:
- FREE Two-Day Shipping on eligible items to addresses in the contiguous US and other shipping benefits.
- FREE Same-Day Delivery in eligible zip codes.
- Prime Video offers unlimited streaming of movies and TV episodes.
- Special discount
- Prime Day and other special events participation.
According to the digital magazine “Digital Commerce 360”, since the program launched in 2005 it has been an incredible success.
“Amazon.com Inc. has 200 million members in its Prime membership program worldwide, CEO Jeff Bezos said in his annual letter to shareholders published April 15. Comparatively, Amazon said it had more than 150 million Prime members globally in January 2020.”
(Alí, 2021)
On the other hand, the same magazine investigation concluded that it is very unlikely that consumers cancel their membership which means that it´s a growing market with trustworthy buyers that will continue buying there throughout their life.
“For example, 69% of consumers who sign up for a trial membership convert to a paid membership, according to CIRP, and that’s up from 64% reported in Q3 2020. 93% of consumers continue to pay for the program after one year, while 98% stay signed up after they’ve been Prime members for two years.”.
(Alí, 2021)
4. Fulfillment By Amazon takes care of your distribution operations.
Now that we are familiar with what being a Prime Member represents for customers, let´s look at it from a seller´s perspective. Since one of Prime´s main goals is short delivery time, as a seller you have to comply with Shipping delivery time frames to be eligible for the Prime Badge in your product´s offer.
This is why, we strongly recommend to have your products Fulfilled By Amazon (FBA). It not only grants you the Prime Badge but also enables other FBA programs to grow your business.
Digital magazine “Feedvisor” describes FBA program this way:
“Fulfillment By Amazon (FBA) is a service provided by Amazon that provides storage, packaging, and shipping assistance to sellers. This takes the burden off of sellers and grants them more flexibility in their selling practices. The program allows sellers to ship their merchandise to an Amazon fulfillment center, where items are stored in warehouses until they are sold. When an order is placed, Amazon employees physically prepare, package, and ship the product(s).”.
(Feedvisor, n.d.)
Another key benefit is that Amazon provides 24/7 Customer Service which is completely necessary to assist buyers in their purchase’s satisfaction. Having your inventory in FBA also grants you access to programs such as Multi- Channel Amazon Fulfillment where you can fulfill your orders from your own website or other sources and Subscribe and Safe so you can reach customers with recurring and scheduled sales.
With FBA, you can take care of your products while Amazon helps you with packaging, delivery and customer service. Just focus on your supply chain before your inventory reaches Amazon´s doors and they´ll take it from there!
5. Amazon presence worldwide
Amazon has developed different programs within their FBA program to help sellers place their programs in other marketplaces around the world.
The most attractive program available for US sellers, is “North American Remote Fulfillment”. Here´s a detailed description of the program found in the seller´s platform “Seller Central”:
“Remote Fulfillment with FBA lets you sell to customers in Canada and Mexico without having to send inventory to those countries. When you enroll in the program and create offers on Amazon.ca and Amazon.com.mx, Fulfillment by Amazon will use your inventory in US fulfillment centers to fulfill orders across the border directly to the customer, through Amazon Services LLC.
The program offers Prime customers free shipping in Mexico (five to nine days) and Canada (seven to 12 days).” (Seller Central, 2021).
This means that with no major effort you are now able to also reach Mexico and Canada customers. A huge opportunity of growth without doubt.
Withing time, Amazon has managed to successfully position themselves in other countries around the world. Another triumph for example has been Europe where they are reaching customers from Spain, England, France, Germany, and Italy.
“Amazon’s success in Germany relies on a simple formula: The company satisfied a market gat by offering an easy-to-use website, with a selection of products far wider than its competitors’, fast shipping, and very generous return policy. On the other hand, the Amazon Marketplace was a hit with sellers, giving them a competitive platform at a low cost.”.
(Marco, A. 2020)
The ecommerce master also provides sellers with paths to contact international representatives that will warmly help them to develop their business in other marketplaces which is a growth opportunity that not other many companies provide.
6. Amazon has special features available for brand owners like you!
Becoming an Amazon seller every day becomes more attractive. Plenty of businesspeople are looking for the right product to sell or reseller. Amazon´s main interest is to protect the customer´s interest and that´s why they fight counterfeit issues daily to try to improve customers experience.
Therefore, Amazon has been working on protecting brands with their program Brand Registry. With this brand protection program, new features have been developed and optimized. For example, now, you can have your own brand store inside of Amazon which allows you to communicate your brand´s value effectively to buyers. On the other hand, you can promote your brand store with the assistance of Sponsored Brands and appear on important placements that will grant your products considerable visibility.
Amazon describes a Store in their advertising console this way:
“A Store is a free, self- service branded destination on Amazon where you can curate content that inspires, educates, and helps shoppers discover your products. Stores give you control to create a shopping experience on Amazon that you can optimize using insights about performance, campaigns, traffic, and sales related to your Store.”,
(Amazon Advertising, 2021)
Considering that Amazon charges zero fees to allow you to create such landing page, brand owners should take advantage of this possibility and start investing resources in developing a fresh engaging store inside of Amazon.
Once you have created your store, the next step for sure is to make sure customers see it! For this, Amazon developed the marketing channel of Sponsored Brands. They define it in the following way:
“Sponsored Brands are cost-per-click (CPC) ads that feature your brand log, a custom headline, and multiple products. These ads appear in relevant shopping results and help drive discovery of your brand among customers shopping for products like yours.”.
(Amazon Advertising, 2021)
Creating sponsored ads campaigns is great tool to increase exposure and to reach customers that are looking for your product or brands like yours.
Sources
MacDougall, H. (2020, August 26). Amazon. Every day is one for health and safety training. https://www.aboutamazon.com/news/operations/every-day-is-day-one-for-health-and-safety-training
Palmer, A. (2020, September). How Amazon Managed The Coronavirus Crisis And Came Out Stronger. CNBC. https://www.cnbc.com/2020/09/29/how-amazon-managed-the-coronavirus-crisis-and-came-out-stronger.html
Amazon. (2020, May 18). Leadership Principles. https://www.aboutamazon.com/about-us/leadership-principles
Mohsin. M. (2021, March 9). 10 Amazon Statistics You Need to Know in 2021. Oberlo. https://www.oberlo.com/blog/amazon-statistics#:~:text=Summary%3A%20Amazon%20Statistics,-Amazon%20is%20the&text=It%20had%20150.6%20million%20mobile,2019%20(Statista%2C%202019)
Smith, A. (2017, November 16). What Amazon Key Teaches Us About Trust In Customer Relationships. Forbes. https://www.forbes.com/sites/anthonysmith/2017/11/16/what-amazon-key-teaches-us-about-trust-in-customer-relationships/?sh=2c63cbf577d0
Amazon. (2020, May 18). Help & Customer Service Amazon Prime. https://www.amazon.com/gp/help/customer/display.html/ref=vnid_G6LDPN7YJHYKH2J6?language=en_US&nodeId=G6LDPN7YJHYKH2J6
Alí. Fareeha. (2021, April 16). Amazon Prime Reaches 200 Million Members Worldwide. DigitalCommerce360. https://www.digitalcommerce360.com/article/amazon-prime-membership/#:~:text=Amazon%20Prime%20membership%20grew%20to,2020%2C%20according%20to%20CIRP’s%20estimates
Feedvisor. (n.d.). Fulfillment By Amazon (FBA). https://feedvisor.com/university/fulfillment-by-amazon/#:~:text=Fulfillment%20By%20Amazon%20(FBA)%20is,and%20shipping%20assistance%20to%20sellers.&text=The%20program%20allows%20sellers%20to,warehouses%20until%20they%20are%20sold.
Palmer, A. (2021, April 29). Amazon’s sales surge 44% as it smashes earnings expectations. CNBC. https://www.cnbc.com/2021/04/29/amazon-amzn-earnings-q1-2021.html
Day, Matt. (2021, April 14). Amazon Pledges to Promote More Women, Black Employees. Bloomberg. https://www.bloomberg.com/news/articles/2021-04-14/amazon-pledges-to-promote-more-women-black-employees
Seller Central. (2021, May 19). Remote Fulfillment with FBA. https://sellercentral.amazon.com/gp/help/external/G5P3CDUHZWSZLXLB
Marco, A. (2020, May 18). Amazon International Expansion & What We Can Learn. Day Translations. https://www.daytranslations.com/blog/amazon-international-expansion/
Amazon Advertising. (2021, May 19). Stores. https://advertising.amazon.com/solutions/products/stores
Amazon Advertising. (2021, May 19). Sponsored Brands. https://advertising.amazon.com/solutions/products/sponsored-brands?ref_=a20m_us_gw_sb