MORE SELLERS, MORE PROBLEMS!
It is easy to see why brands get lured into authorizing multiple sellers to distribute their brand on Amazon. On the face of it, it may look like more sellers will simply increase sales and that be the end of it. However, the majority of the time sales do not increase and if they do, this simply matches the trend of the brands overall growth.
SO WHAT ARE THE IMPLICATIONS?
The typical outcomes that we come across when too many sellers are on an Amazon listing are as follows:
- No change in sales – A lack of brand investment from resellers means the same rate of sales or often a drop in sales, as competitors get more savvy. It is rare that sellers care for the brands that they work with, rather they simply look to buy the stock to sell at a profit. This means no investment in marketing brands, so demand remains unaffected. This includes not optimizing listings correctly, leaving opportunity to increase traffic through ranking for more keywords, increasing click through rates onto listings and increasing sales conversion rate on listings. This improves seller rank which means that the product is displayed higher on relevant searches, increasing sales further with more exposure. From here, sales can be boosted further with strategic PPC (Pay Per Click) ads. If this is not actioned, any competitor with well optimized listings can outperform the brand.
- A decrease in profitability – With multiple resellers competing with each other, it is very common for price wars to occur. This often sees products selling for a lot less than what the brand wants, negatively effecting brand image and biting into the sales of other platforms away from Amazon. Also, brands with resellers only receives the margin from manufacturing cost to wholesale. By the brand taking ownership of their Amazon presence and selling direct to customers instead to their resellers, they can sell from manufacturing costs to RRP and increased margin instantly.
- Poor brand image – Following on from the previous point addressing that price fluctuations are not good for brand image, another factor proving detrimental to brand image is when resellers fail to take time to respond to negative reviews and fail to generate more positive reviews. This again is usually due to a lack of care for the brand and in turn has a negative impact on sales. Over 90% of consumers now read Amazon reviews before making a purchasing decision about the product (whether they buy online or in a brick and mortar store). Replying to any critical reviews is vital in order to maintain/build strong social proof (you can read more on reviews here). Our strategies facilitate this and also help to grow new positive product reviews by around 30% of the product’s sales volume.
TIP – LESS IS MORE!
Brands benefit from working with fewer resellers that know how to operate effectively. These can be hard to come by and so most brands are now opting to manage sales operations in house by teaming up with expert management companies like ourselves. We work in co-ordinance with brands to actuate sustainable market growth.
KEEP CONTROL OF YOUR PRICING AND BRAND IMAGE
Removing resellers can eliminate problems caused from a lack of control. This protects brand image and leaves brands in a better position for stable, continual market growth. In order to implement this as quickly and as effectively as possible, brands are opting to utilize expert management companies like ourselves. With our infrastructure, resources, experience and expertise, we empower brands again and provide a wide range of market leading services to catalyze brand growth and get the full potential of the brand.
LETS DISCUSS THE WAYS THAT OUR TEAM CAN TAILOR STRATEGIES TO EXPLODE YOUR BRAND’S SALES AND GROWTH ON AMAZON