Direct to Consumer Brands, what to do with Amazon?

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I have recently gotten into the Amazon management business and many brands don’t know where to lump Amazon as a partner. If you spoke to 10 brands about Amazon, 8 would hate them, 1 would be confused and 1 would be happy. Amazon is a massive platform for brands, you simply cannot ignore it. Consumers are often times more loyal to Amazon than the brand/product they are looking for, so you need your product on there. You just need to know how to utilize and leverage it. Your direct to consumer or retail business can work synergistically with Amazon. Here are a couple of things to think about / consider:

  1. Pricing and Promotional StrategiesIf you have tight control of your distribution and are primarily direct to consumer, I would offer a lower price on your site than that of Amazon. Amazon can get a little upset about this strategy, especially if their price monitoring spiders pick it up, but you can get more creative than just a lower price on your site. Offer up other value ads like product samples, free content, buy 1 get 1 free style promotions, etc.
  2. Use it as a fuel, not as the primary vehicle – Amazon should never be considered the primary revenue source for your brand. It’s important that you de-leverage the Amazon concentration on revenue as they will start putting the squeeze on you (costs, margins, fees) if they suspect they are a large share of a brands revenue. It’s a great starting point for new products, but you need to expand on other channels and focus on your own website sales. Not just for margin reasons, but to better control the consumer experience.
  3. Reputation ManagementConsumers may be sold on buying from your direct brand site to get a promo, but they still may go to Amazon to see what the reviews look like. Amazons review platform is the most trusted review system in the eyes of consumers. So, what Amazon says about your product is probably even more powerful than what Yelp might be to a restaurant. Fund marketing campaigns to drive initial sales into Amazon to seed it with good reviews. And if your product sucks, and is susceptible to poor reviews, the internet is not for you. You cannot drive a successful product online if your products naturally garners poor reviews.
  4. Data and TrendsAmazon offers up a lot of consumer sales trend data that brands can use to find gaps in product categories. It’s a great thing to look at when you are considering a product refresh or trying to find other products that would compliment your brand. I recommend using JungleScout.com, it gives you a lot of great data and is a chrome extension so it gives you the data right on the Amazon product pages.
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