Thursday, 27 June 2013

Amazon’s Tough Trading Environment Calls for Smarter Technology

Amazon’s third-party marketplace is (next to eBay) one of the first ports of call for many small and medium-sized online retailers. With more than 85 million unique visits to its global sites per month, ease of listing (no HTML or design skills required) and zero-cost listing fees it is easy to see why Amazon offers such an attractive proposition to online entrepreneurs who just want to start selling.

But selling on the world’s most popular eCommerce site isn’t always that easy.

Amazon is a very competitive environment (unlike eBay, you are even competing against the marketplace itself). It is also governed by incredibly strict rules designed to maintain the highest standards amongst its third party vendors. Suspensions and complete removals from the marketplace are common if even the slightest hint of foul play is suspected – and if you get thrown off Amazon, it’s almost impossible to get back on.

Despite the promise of free listings, selling on Amazon can be very expensive with seller fees ranging from 8.05% (Large Appliances) to 40.25% (Kindle Accessories). And remember, Amazon is not a high cost acquisition channel, with terms and conditions stating that all customer data belonging to Amazon, meaning you are unable to add their details to your email marketing lists.

Then there is the issue of price parity. Amazon insists that sellers do not list their products on Amazon at a higher price than 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.

The most successful sellers on Amazon understand how to optimize their listings in terms of price, availability (i.e. units available) and reputation (meaning items are shipped in a timely, professional manner and any customer service issues dealt with promptly).

Selling on Amazon can be tough. Competition is fierce and margins can be destroyed if you are unable to keep your eye on the ball.

New Technology Lends Amazon Sellers a Helping Hand

There are of course a number of technology solutions on the market to help Amazon sellers maximize their opportunity and ensure products are sold at the right price, ensuring margin is protected and profit achieved.
I believe, two recent additions to the Amazon sellers’ strategic software arsenal offer perhaps the best opportunity yet to make the Amazon marketplace work for you.

  • Terapeak – 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 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.  

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