Winning on Amazon: Here are 3 strategies that can help

By Andrew Waber

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Paraphrasing what Ginny Marvin wrote in this publication recently, 2018 was largely the year Amazon’s ad business matured. But changes like the unification of Amazon’s ad products and the launch of other sponsored product type units on the site also reflect how the online retailer has matured in other ways. Amazon is set to clear $258.2 billion in US retail sales in 2018, according to eMarketer – a full 5 percent of all retail sales – and a far cry from its 1 percent share just ten years ago. To grow market share overall, brand marketers need to mirror their larger Amazon strategy to reflect how the retail site itself is setting its priorities.

1. Focus on share of audience, not share of wallet – and act accordingly

Amazon admittedly isn’t the number one place people buy groceries, but it’s absolutely one of the top destinations for eyeballs when those same consumers are looking at grocery products online. As Sri Rajagopalan from Johnson and Johnson explained in his recent Linkedin post: “I have never heard an Amazonian talk to me about share of wallet… Do not obsess on your Amazon share of wallet, but do, on share of audience.”

Amazon is a branding platform. Sharing this viewpoint across your marketing organization puts your brand in a better position to execute well on the new Amazon ad offerings by better aligning brand and trade marketing budgets and teams. On the unpaid side, it also underscores how marketing-heavy language and content is what you want present on your product detail pages, how that content needs to be actively managed to continually maximize conversions, and even which products are worth that level of effort. To that point…

2. Start asking hard questions about your product assortment

Brands who worked to get their full catalog of products on Amazon years ago may need to scale that back given Amazon’s focus on item profitability. “CRAP out” is now part of the industry lexicon. The increased competition on the site itself necessitates more active management of individual SKUs to maintain visibility and market share. The reality is that brands are going to be hard pressed to profitably sell a wide range of inexpensive products on Amazon.

What are your brand’s highest value SKUs from a margin, visibility, or brand equity standpoint? Focusing on that subset of products, both organically and with paid promotion, will drive substantially more value than putting out “CRAP” fires and the associated chunk of man hours dedicated to that long tail. Meanwhile, looking into e-commerce-oriented packaging can help make some of those latter products easier to sell profitably on the site down the line.

3. Prep for ‘One Vendor’ change by getting on the Brand Registry

The unification of Amazon Vendor Central and Seller Central is on the horizon in 2019. The precise impact of this change for brands is still undetermined, but one thing we know for …read more

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