Amazon Vendors Pressured onto Seller Central: An Unexpected Shift

March 8th, 2019 Posted by Amazon, Brand Management, Seller Central 0 thoughts on “Amazon Vendors Pressured onto Seller Central: An Unexpected Shift”

Once again, it appears Amazon is pulling the carpet from underneath its vendors in a bold surprise move. While Amazon has not made an official statement, rumors are swirling that Amazon.com, without warning, has stopped purchasing products from many of their wholesalers, instilling fear amongst their vendors. Without any official communication at this time, Amazon vendors have stopped receiving their regularly scheduled POs for the week. As panic sweeps the community, many vendors are turning to forums, community channels, and social media sites in hopes for some form of clarity on the situation. With a clear lack of information from Amazon and reportedly thousands of vendors impacted, the time is now to consult with an Amazon-focused agency.

The abrupt shift from Amazon is a clear attempt to encourage vendors to sell directly on their marketplace, shifting to Seller Central. Amazon, looking at the bigger picture, can now offload the cost of purchasing, shipping, and even storing products. All the while, Amazon can continue to charge suppliers for these services, while also pocketing a commission on every transaction, which is a much more secure strategy. Amazon remains to be buyer-centric. The company is determined to raise profits within its core e-commerce business, even if that means disrupting relationships with its loyal suppliers. The unfortunate reality of the situation is that many suppliers need to source products from manufactures months in advance. Vendors will need to act quickly in shifting to an appropriate sales tactic if the expected orders do not arrive.

CEO Dan Brownsher, of Channel Key, a LA-based e-commerce business, selling more than $100 million of goods on Amazon annually has already spoken out. He states, “If you’re heavily reliant on Amazon, which a lot of these vendors are, you’re in a lot of trouble.” The only related statement to come from Amazon reads, “We regularly review our selling partner relationships and may make changes when we see an opportunity to provide customers with improved selection, value, and convenience.” The company continues to decline specific inquiries on the situation. A lot of the panic was noted at the recent ShopTalk conference that drew in a crowd of over 8,000 retailers in LA. Many vendors have stated that Amazon simply stopped submitting routine orders on a large variety of products, usually without any explanation.

With Amazon’s rapidly evolving platform, it is crucial to choose your Amazon partners wisely. Walmart, Target, and Best Buy have all adapted Amazon’s online business model. Amazon will generate e-commerce revenue of $317 billion this year alone. This figure represents 52.4% of all online sales in the U.S, according to EMarketer Inc. With Amazon, once again shifting the marketplace, more vendors will now be forced to sell on the marketplace directly or run into the risk of getting stuck with unsold inventory said the CEO of Marketplace Valet, Will Land.

If you haven’t already done so, put together a contingency plan. Continue to stay cool and go about your business as usual on Vendor Central. Continue promoting, advertising, etc… The goal is and always has been to keep sales momentum steady and ensure a painless transition when a shift occurs. If it is all a little too overwhelming, come talk to us. With our 32 years of experience in the industry, we have the foundation to guide your brand through these troubled waters.

Advertising on Amazon

February 25th, 2019 Posted by Advertising, Amazon 0 thoughts on “Advertising on Amazon”

So you’re launching a brand new product on Amazon or you want to bring attention to a marketplace veteran. Consider utilizing the simple, yet powerful tool of Amazon Sponsored Ads. These ads are based on PPC or Pay Per Click, campaigns that you can control from your Seller Central account. They allow you to direct more visibility to your products on your terms and your budget. Amazon’s Sponsored Ads are an easier to use and more straightforward option than other advertising methods such as Google Adwords.

What are Amazon Sponsored Product Ads?

Typically, when you’re browsing Amazon, you know what you want. Your first stop is at the top of the page where the search bar is. You type in what you want and hit enter. Generally, Amazon will generate products that match your search the best, have good ranks, high reviews and generate the most sales. You might notice the first two results don’t have good if any, reviews or rank. Upon closer inspection, you notice that above the title they say “Sponsored” with a little info button. You guessed it! These are Amazon Sponsored Product Ads.

You may also find them when you’re shopping around on product pages. On the listing, under the Buy Box, under the Other Sellers on Amazon, there’s another product. It’s just like the one you’re shopping for, but different brand or color. Under the bullet points, there’s also another product similar to the other two. This is another example of a more targeted Sponsored Product Ad.

Your Campaign Manager

If you want to create ads for your items, log into your Seller Central and under the Advertising tab is Campaign Manager. This is where you’ll find all your Ad Campaigns: past, present, future, running, active, archived, and all. Each campaign has a start date and an end date. This is helpful for scheduling sales of seasonal products or creating short, but aggressive campaigns to launch new items. Or you can set your campaign to have no end date so it will be advertised indefinitely for steady sales. Campaigns will also have a budget. This is how much you are willing to spend on advertising for the product(s) in your campaign each day. This feature is excellent for keeping your money under control even if you set your bids really high.

Within each campaign are Ad Groups. This is the level on which you can control the bid for your product(s) in the group. Your Default Bid is the amount you’re willing to spend each time a person clicks on your advertisement. There are a lot of strategies on how to set up your Campaigns and Ad Groups. Most PPC experts agree that you should assign on SKU per Campaign and per Ad Group. This gives you more control over the advertising of that single product. However, you may also find that larger, bulk advertising is suitable for your account. The Campaign Manager is designed to give you total control over your advertising so your method is best suited to you time and budget.

Automated World of Amazon

Even if you don’t have a graphic designer on hand, don’t worry. Amazon will generate the actual ad for you. You’ll notice that all the Sponsored Ads are formatted the same. That’s because Amazon takes the product image, brand, price, reviews, and title and turns it into an advertisement themselves. The ad clicks right through to the product page and there is your listing.

Don’t have a marketing expert on hand either? Still not a problem. You can create Automatic Campaigns that take all the guess work and research out of advertising for you. Amazon uses its own special algorithms to associate the product with similar items to create suitable advertising situations. It takes information from the listing and views with which product your item is usually purchased and sets up ads accordingly. This can be a great tool to learning Manual Campaigns as well. Automatic Campaigns will give you the keyword information, showing you what words generated the most clicks and conversions. Then you can set up Manual Campaigns based on those details.

Making it Manual

Most sellers agree that going Manual is the right choice. Algorithms are impressive at generating results with very little work, but no computer knows your product better than you. In Manual Campaigns, you can specify bids on certain words and use Negative Keywords to keep your product from showing up in the wrong searches. You also can choose your Match Type which controls how close your keyword has to be to a customer’s search term for your product to show up. You can choose Exact, Phrase, and Broad which in that order go from most to least precise and hardest to easiest to manage.

Let’s say you’re selling a pair of boots, specifically women’s brown heeled ankle boots. You might set up a manual campaign where you bid on the Phrase “brown ankle boots” which will probably get your ad to generate based on the Search Term “ankle brown boots” or other variations of that. You might to an Exact match for “ankle boots” so, with the right bid, your product will show up when someone searches that exact word combination. Then you might do some general Broad keyword matches for different combinations so your product is visible when someone is searching relevant Search Terms.

Your target here is a woman who wants brown ankle boots and with your Keywords, you might be showing up in the search for “brown boots.” But there are a lot of working men out there trying to find heavy-duty, steel toe, brown boots, and these are not the kind of searches in which you need your product to appear. Now is when you would use your Negative Keyword feature. You could put “work” or “steel toe” in your Negative Keywords which would prevent your product from appearing when someone searches “steel toe brown boots,” giving you more accurate results.

How’re You Doing?

Amazon is good at keeping you informed with Key Performance Indicators or KPIs. This is the data you’ll see in your campaign manager that lets you know how your advertising is going. Accurate KPIs take about a week to show since it takes time to build consistent data. KPIs include Impressions which is how many times your ad appeared on Amazon. Low impressions can either mean that your bid is too low and other people are beating you out for those Keywords, or your Keywords are not frequently searched. Clicks are how many people click on your advertisement. Remember each one of these clicks cost you money, even if there is no Conversion. A Conversion is a sale, which is the ultimate goal of your advertisement.

Then Amazon breaks those numbers down into the data you need. Your Click Through Rate or CTR is the ratio between impressions and clicks. A low click-through rate may mean that your ad is showing in irrelevant searches. This is a good time to revise Keywords and Negative Keywords. Next is your Conversion Rate. This is how many Conversions (sales) you’re averaging per click. A low Conversion Rate can often be an indication of listing issues like not properly optimized images and copy. The last KPI and often the most important is your Advertising Cost of Sales or ACoS. Your ACoS is the percentage of how much you’re paying to advertise versus how much you’re making in sales. This can be the result of a high click-through rate with a low Conversion Rate.

Balancing your numbers may take time, but there are so many options and resources from Amazon and PPC strategists to help you along the way. Between blog posts, webinars, and tutorials the information is vast, but it’s important to remember that as always you know your product best. You’re the most qualified to advertise and sell it. Explore the options and information and apply it as you see fit to your situation. Amazon Sponsored Product Ads are an excellent tool that can be customized to meet the needs of every seller.

Fight the Amazon Fees

October 16th, 2018 Posted by Amazon, Brand Management 0 thoughts on “Fight the Amazon Fees”

Welcome to the fourth quarter where everything is amped up and your budgets don’t matter. Amazon’s recently redesigned long-term storage fees kicked off last September. Combined with the annual increase in monthly storage fees, it’s getting more challenging to leave your products in a fulfillment center. Sellers have to balance the right amount of inventory to keep their product in stock without costing them a fortune in fees.  With the heat turned up, some sellers have decided to take themselves out of the kitchen. Programs like Seller Fulfilled Prime, FBA Onsite and e-Fulfillment are making the reasons to keep your products at an Amazon fulfillment center obsolete.

Going Through Changes

In March Amazon declared that they would be changing a number of Inventory Storage Fees and Policies. First, monthly storage fees would be in increasing $0.05 across the board for items of all sizes. Then they said they would be changing the Long Term Storage Fees as well. There would now be a minimum long-term storage fee of $0.50 for any product over 365 days old at an Amazon Fulfillment Center. That means even the tiniest of items would cost at least $0.50 per until to store after 365 days.

But possibly the largest change was taking the long-term storage fees from semiannual to monthly. Starting September 15th, products over 180 days old would be charged some kind of long-term storage fee. Inconveniently, this plan was implemented after the last semiannual fee date and the month before the monthly storage fees triple for the fourth quarter. Avalanche found themselves in a pickle and began exploring options to relieve the financial stress of storing their products with Amazon.

Become Self Fulfilling

Amazon has a program called Seller Fulfilled Prime which allows sellers to get a prime badge while sending the products from their own warehouse. Sellers can enroll online through their existing account. They just have to provide their information and location, complete a trial, and then they can offer prime to the people around them.

Whether a customer has Amazon Prime or not, they’re more likely to purchase products from a Prime seller. The Prime badge holds a certain amount of trust and integrity. People know they can get what they want, within two days, without paying for shipping, and they know Amazon wouldn’t endorse anything less.

The main setback with classic Seller Fulfilled Prime is that you’re geographically limited. If you shop our products outside of a certain distance, our account no longer offers prime. Because we’re located on the east coast, we’re fortunately able to reach major cities like Philadelphia, Washington DC, and New York. However, we still cannot provide Prime to places like Los Angeles or Houston.

Keep it Close to Home

Avalanche has been working on their FBA Onsite game for about a year now, and the payoff is immense. Onsite gives us the ability to receive things in our own warehouse and list them for sale on Amazon while maintaining our Prime badge and listing us as Fulfilled by Amazon. Essentially, our warehouse has been turned into an Amazon Fulfillment Center. The more we’re able to store on our own campus, the less we have to pay in storage fees, and we can do it all while still maintaining the integrity of an FBA seller.

Because we don’t have to pay storage fees of any kind for Onsite products, it allows us to sell and ship oversized items that were once too expensive to send to Amazon. It’s also a great help for when Amazon is backed up on checking in products. If we check our inventory in on Onsite while it’s in transit to Amazon, we can cover potential out of stock days. This will be especially convenient come December when Amazon can no longer guarantee that your product will be checked in before Christmas.

Certainly, this isn’t without its own fees and complications. We have to have our warehouse and equipment inspected and regulated by Amazon, ensuring that we’re meeting all their requirements. There are still Onsite fees to be paid to Amazon, but whenever these fees are cheaper than sending it to Amazon, we keep the products on campus.

UPS Ups the Game

The most recent endeavor on which Avalanche is embarking is UPS’s new e-Fulfillment program. UPS has two fulfillment centers, one in California and one in Kentucky where sellers can now send their products. In these centers, sellers can store and ship their products through their account on Amazon under Seller Fulfilled Prime. They even fulfill to 15 different sales channels, expanding the customer base for sellers.

Because Avalanche is located on the east coast and the UPS warehouses are in Kentucky and California, it gives our account the ability to show Seller Fulfilled Prime nationwide. It also improves our rate of replenishment. While typically we stop ordering Halloween products from west coast companies at the beginning of October, we’re able to order well into the season and have them shipped directly to an e-Fulfillment center. This also helps out our own shipping department who have enough on their plate during the fourth quarter. UPS even guarantees that all products will be checked in within two days of receiving, which will be especially helpful come December 2nd when Amazon can’t guarantee a product will get checked in before Christmas.

The program is still in its very beginning stages, but Avalanche is already showing profits on a handful of products that they’ve sent in for e-Fulfillment. The more successful the program is and with the addition of new sellers, they could expand their fulfillment centers and may promise to be a convenient alternative to fulfillment by Amazon.

There’s Always an Answer

Amazon has been throwing curveballs our way since we’ve listed on their site in 2009. Sometimes we strike out and other times it’s a home run, but no matter what’s happening on the field, our team is always working to find new and innovative solutions. The change in storage fees may have been a setback, but it helped us explore and expand other avenues of sales, which could prove to be more lucrative than our previous approaches. We live each day like it’s the first and see every hurdle as an opportunity to learn and grow.

The Secrets to Expanding Your Brand

August 1st, 2018 Posted by Amazon, Brand Management 0 thoughts on “The Secrets to Expanding Your Brand”

Essential Online Presence

Amazon is the largest internet based retailer in the world. They have retail websites for 15 different countries and the ability to ship worldwide. With that kind of exposure, it only makes sense for retailers to have their products listed on the website. Brick and mortar appeals to local consumers and independent websites are great for brand presence and consistency, but for a retailer interested in volume, Amazon is the key.

Here’s the catch, Amazon can be a multifaceted and challenging experience requiring attention from a full-time team. For this reason, many brands and distributors partner with third-party retailers who dedicate their time to maintaining brand integrity and value product by product. This gives retailers the time work on their brand and product line on an intimate level while teams like Avalanche handle the Amazon storefront in a variety of ways.

Getting Your Products Noticed

Amazon has very specific algorithms for what products appear when you’re browsing. One of the factors is a product’s sales rank, based on the frequency with which that product is purchased in comparison to other products in that category. Items that are brand new to the marketplace will not have a sales rank yet, and items that are not properly managed can often time have a poor sales rank. Even if you’re selling the most useful or stylish item, your rank can keep you from getting anywhere.

Partnering with a business like Avalanche Industries will ensure that your product is seen. We have a whole team dedicated to just advertising your products. We run campaigns so when people search related products, regardless of previous sales volume or reviews, your product can appear at the top or bottom of the page. Sometimes a sponsored advertisement will appear on the actual page of a related product.

Perfecting the Production Process

Companies like Avalanche also get your products noticed with proper listing optimization. They employee in-house photographers, copywriters, videographers, and graphic artist to ensure that each product is displaying at its full potential. We shoot the product both in the studio and take it on location to get the full spectrum of uses and looks. When we sign an Exclusive Partner we generally optimize 10 to 20 listings upfront. That’s anywhere from $15,000 to $20,000 in complimentary production services that we offer our clients, showing our partnerships how seriously we take our relationship and our dedication to long-term success. With proper titling, keywording, and descriptions your product is searchable and enticing to consumers. The benefit of partnerships between brands and third-party retailers can pay for itself instantly with production services alone.

Our Lead Photographer, Chris Vendetta explains the importance of brand consistency, “As a consumer when I find a great product, then go to Amazon and I see poor images, iPhone box shots, I doubt what I am getting. I worry if it’s a knockoff. I worry it was used. Data shows that doubt on the consumer end will cost you sales long term.” With a production team, associates work with their brand and reps to identify what should be showcased about their brand as a whole, as well on the product level to ensure consumer-friendly consistency.

Maintaining Brand Integrity

Anyone who has optimized a listing on Amazon knows that the most painstaking tasks is getting your images, copywriting, or videos to show on the page. Once it shows, there’s no guarantee that it will continue to show, so essentially all of that production work was for naught. Third party retailers often have their own departments dedicated to maintaining the listing to show all of the production work.

Occasionally when information falls off a product or it receives a bad review, Amazon will take the listing down. These teams also catch any inactive or suppressed listings to fix them and get them up and running again for consumers to see. Avalanche has its own in-house proprietary software to catch any listing issues, so our teams can fix them immediately.

Shaped Up and Shipped Out

Amazon has a variety of packing, shipping, and labeling rules and regulations for a product to be considered sellable. Your brand’s packaging, no matter how creative or stylish, might not be up to code for Amazon. Third party sellers like Avalanche have fully equipped shipping departments where your products can be expertly prepped, packed, labeled, and shipped under all fulfillment standards.

Avalanche currently has a total of 58 full-time employees including a number of temporary and part-time employees. They are in teams or managers, preppers, shippers, receivers, and issues staff and work in three large industrial warehouses. With all efforts combined Avalanche ships about 350,000 units and over 300 pallets per month. Most retailers do not have the capacity to do all of the shipping and labeling while producing their own line of products, which is why partnering with a third party retail can immeasurably beneficial for a company.

All of the Opportunities with None of the Work

Third party retailers are the perfect option for companies that want all of the volume of listing on Amazon without any of the effort to maintain listings. Companies that partner with Avalanche can maintain their brick and mortar store and work on expanding their brand while third-party retailers like Avalanche handle their day to day business with Amazon. We take optimization and upkeep of your plate so you can focus on what you do best. It just takes one more pallet and one more invoice to send, allowing for maximum return on investment.

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