Confession time: The SlyMarketing authors (that’s us) have a love/hate relationship with Amazon. There. We said it. It feels good to get that out.
Amazon is great for customers (we’ll probably be lifetime Prime members), but can treat its sellers like second-class citizens (if you’ve ever received a bogus policy violation, you know what we mean).
Our feelings tend to skew this way with some of the other online marketplaces, too, but Amazon definitely gets the biggest swing of emotions.
However, if you have product to sell and want to get that product in front of the largest number of buyers in the world without spending a lot of time and money on marketing, then you need to put any bad feelings aside and sell on Amazon. There’s no question. It’s a no-brainer. Do it. Like yesterday.
When we first started dabbling in selling automotive products online, eBay was pretty much the only place to sell stuff, short of your own web site.
Our approach was to list product on eBay, sell it and then ultimately convert that customer over to buying from us on our site, in addition to marketing the site on forums and through pay-per-click advertising like Google and Yahoo.
It worked great for this very specific, niche group of car enthusiasts.
In later creating a business around a lot of different types of products that didn’t necessarily serve a particular customer group, marketing a web site was significantly more challenging and expensive.
The advent of Amazon’s Seller Marketplace presented us with an amazing opportunity.
We were able to list as many products as we wanted for a low monthly fee and a percentage of each sale.
It doesn’t work for everyone and every product, but if done right, it can work really well for you and your business.
PROS
Instant access to millions of potential customers — That means immediate access to millions of customers who might want to buy your stuff! Amazon takes a monthly fee (currently $39.99 for business accounts) and a percentage of each sale (varies depending on the category a product is listed in). You list your products or attach yourself to products that are already listed and sit back and wait until the orders come in…hopefully. Amazon does all the marketing for you.
Quick listing — Amazon’s listing tools are pretty easy to use whether you’re listing products one at a time or in bulk. You can actually create a product listing from scratch in a matter of minutes.
Huge product catalog — It’s even faster and easier to list products that are already in Amazon’s product catalog. Plus, you may find products that you could be selling, but aren’t.
Easy seller interface — Everything from shipping to customer service to reports can be handled and accessed within the interface.
FBA — The Fulfillment by Amazon program (where you ship a bunch of products to Amazon’s fulfillment center and they ship products to the customer, as well as handle customer service) can be a great experience for sellers who are looking to offload the fulfillment experience. It can also result in a bump in sales over seller-fulfilled product, because you’ll likely earn the Buy Box as well as having Prime Shipping eligible products. It is more expensive, though, so you’ll need to consider that in your decision.
CONS
Anyone can jump on your listings — Oy. This was one of our first major surprises and irritations when we started selling on Amazon. We spent loads of time and effort developing unique products to sell. Then more time creating the product listings, including good photos, descriptions and keywords. Everything was humming along nicely for a few months until one day we noticed that another seller jumped on our listings and was selling the product (that we created!) for less money.
Price competition — If you’re selling a product that others are selling, chances are you’ll find yourself in a price war at some point. Some sellers use re-pricing software to monitor how other sellers price a product and then automatically lower the product’s price in order to always win the coveted buy box — the button on a listing that says ‘Add to Cart.’ Smart sellers set a threshold so that a product price does not go below a certain point. Others may not. You’ll need to be careful to make sure that you’re making enough money to make a profit.
Policy violations and account notifications — Written at the end of each email from Amazon about something you may or may not have done wrong is the threat of suspension of your selling privileges. This standard language from them is not in the best taste in our opinions and can be pretty off-putting. Be aware of it, but as long as you’re not purposely doing things to violate Amazon’s policies and you respond quickly to either correct the situation or reply to Amazon about why their reprimand was a mistake, you should have no trouble keeping your account in good standing.
Category approvals — Certain product categories require Amazon’s approval before you can list product in them. Unfortunately, some of them are almost impossible to get into. We’ve found that Jewelry, Apparel and Automotive are particularly challenging departments. When you’re applying for a category, there are some inane hoops you’ll have to jump through, such as providing a spreadsheet with parent/child listings (variants), even if you’re products don’t have them, and making sure that your product pictures have perfectly white backgrounds. Perfectly white.
Amazon owns the customer, not you — Amazon hides customer email addresses and strips any reference to email or web site addresses. If you email a customer, you can’t include that stuff.
Even after all those cons, consider this: Amazon.com is currently the third most-visited site in the U.S. and ranks sixth in the world. They tout that their U.S. site reaches 95 million unique visitors every month, about 30 percent of the U.S. population. Holy cats. There is no greater, easier way for you as a seller to get in front of such a large audience. Do it.
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