Help is at hand for Amazon seller who want to get their margins right
Amazon may be one of the first ports of call for many small and medium-sized retailers when they want to start selling online but that doesn’t mean it is one of the easiest trading environments for rookie online sellers.
By John W. Hayes
With more than 85 million visitors per month to its global sites, speedy listing process (no design or coding skills required) and zero-cost listing fees, it is easy to see why Amazon offers such an attractive marketplace opportunity for sellers who just want to sell.
Amazon might be the world’s most popular eCommerce site but it’s also the most competitive.
On Amazon, sellers are not just competing with their fellow traders but with Amazon itself (unlike similar marketplaces such as eBay and Play.com) with its massive buying power and absolute control over who gets preferred placement on product pages.
Amazon is also governed by very strict rules designed to maintain high standards amongst its third party vendors. Suspensions and complete removals from the marketplace are common – and if you get thrown off Amazon, it’s almost impossible to get back on.
Amazon is also quite an expensive venue to sell on, with seller fees ranging from 8.05% (Large Appliances) to 40.25% (Kindle Accessories). You should also remember, when you sell on Amazon, its terms and conditions state that all customer data belongs to Amazon, meaning you are unable to add their details to your email marketing lists. In this respect Amazon offers little in the way of customer lifetime value.
Then there is the issue of price parity where Amazon insists that sellers do not undercut their products listed on Amazon elsewhere on the web (including eBay and their own website). You’d be naïve if you thought that Amazon doesn’t police this – they do.
Selling on Amazon can be tough. Competition is fierce and because of this, profits may be hard to find. The most successful sellers on Amazon understand how to optimize their listings in terms of price, availability and reputation. This is where technology comes in handy.
New technology to optimise your Amazon sales
There are a number of software solutions on the market to help Amazon sellers maximise their opportunity and ensure products are sold at the right price, ensuring margin is protected and profit achieved.
Two recent additions to the Amazon sellers’ strategic arsenal offer perhaps the best opportunity yet to make the Amazon marketplace work for them.
• Terapeak (www.terrapeak.com) – Terapeak has long been a favorite research tool for professional eBay sellers allowing subscribers to monitor which products are actively selling on the marketplace and what price they are achieving.
This intelligence allows sellers to make more informed buying decisions (which is often the point when profits are made/lost). Terapeak have expanded their service to offer similar marketplace intelligence for Amazon sellers (and more intelligent sellers is definitely a good thing).
• RepricerExpress (www.repricerexpress.com) – Monitoring your competitors pricing and re-pricing your own products accordingly can be a real pain and a task that will severely eat into your working day if you handle it manually.
This is time that could be better spent researching new products (see above), managing customer services or optimizing other areas of your business, helping you become a more efficient, profitable online seller. RepricerExpress works with all third-party listing tools and can re-price up to 50,000 items per hour based on strict business rules to ensure you maintain margin and remain competitive.
John W. Hayes is a Marketing Strategist and Contributing Author at Vocus, where he specializes in Email Marketing and Social Media Marketing for Small and Medium-sized businesses using iContact.
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