Here’s what will happen when a brand counter-intuitively decides to consolidate Amazon sellers instead of increasing sellers. Right now sales through Amazon either stay the same, or decline due to new entrants and competitors into the marketplace. This is because multiple sellers are selling the same item under the same listing. All multiple sellers do is compete and fight for an EXISTING set of sales that Amazon brings them.
Amazon does the work to bring in loyal shoppers but the sellers just sit back and collect profits that Amazon throws their way without providing any sort of marketing knowledge or value. None of them actually have meetings or discussions with the brand to figure out HOW to get Amazon to send them MORE sales. The main strategy to get Amazon to bring you more sales is called “Listing Optimizing the Amazon Channel” .
Multiple sellers that sell a product are not doing any work other than sending a PO over to you and then they collect profits from Amazon. This phenomenon occurs because of three reasons.
1. Most of them are very small operations or brick and mortar sellers who don't know Amazon well. They order a few cases and sell them in their store and sell a few online. They don’t have a clue as to how to increase sales and their online selling is preventing massive online growth for your brand. In order to maximize online growth, only authorize these B&M retailers to sell in their stores.
Store owners should not have a problem with this if their store actually has traffic and they can actually move units in their store like you intend. A few store owners who sell on Amazon just use it as a front to make "easy" online sales on Amazon.
In contrast, an Exclusive Amazon professional retailer lives and breathes Amazon. Amazon changes their platform and regulations often which require sustained expertise that an Exclusive seller has. They specialize in reaching the hundreds of millions of shoppers on Amazon instead of just "dabbling".
2. Some might be so large that you are just 1 out of the 100,000 skus/brands that they carry. Their business model is to "play the numbers game" with brand skus and make a few bucks off each one. If they add those 100,000 skus up, it gives them tens or hundred of millions of dollars in revenue and no desire to help and give attention to your particular product.
Even though they offer the largest PO's, these are actually the worse kind of seller which has no regard for MAP agreements or keeping your brand value high since they are interested in volume. If they can make 20 cents profit or loss on an item they will for the sake of cash flow and volume. Generally these don’t have the knowledge or expertise to increase sales because their bread and butter is to solely get sales and growth adding more skus!
They simply have no need to do anything because brands don't want to argue or turn away the PO! A exclusive seller’s business model is to maximize sales by working closely with brands to define their goals, strengthen brand awareness and optimally represent their brand.
3. The current situation is set up for failure for the brand because sellers will only work hard on your brand if they don't have to share the sales. Since all sales are shared with the current sellers, this gridlock will never lead to getting something done..Even if you currently partner with a seller who has the skills and expertise to help your brand, not in a million years would they take the costly initiative, and burden of coming up with a strategy of your products if it will just bring in more sales for the other sellers they share a listing with.
Can you really blame those sellers for not trying to add additional value to you? It's like hiring a sales rep with a fat salary and no commission or bonus and NO QUOTAS. No one hires salespeople that way because it will not incentivise that rep to perform at their potential. Will that rep stay up late to make calls? Will they travel across town to try and meet with a customer?Will they continually follow up and check on the customer to continually increase the relationship and drive additional sales? Why would they do anything if they will get the same bi-weekly direct deposit with or without the effort?
An Exclusive seller is assured that they will be the only one selling so it would give them the green light to put their heart and soul into your brand without worrying about their efforts benefiting another seller. The more work they put in the more reward and ROI that they see from their efforts in the form of increased sales. Increased sales which translate to increased orders for the brand that they would not have otherwise received.
Clearly there is something wrong with this current picture because brands are partnering with retailers who aren’t on the same page and have aligned interests with them. You and your brand have a proud product lineup and would like each one to be represented optimally to give it the best chance to succeed in the marketplace. The status quo of comfortable Amazon sellers/dealers not increasing Amazon sales exists SOLELY because it hasn’t been challenged by brands.
Brands are also comfortable with the existing number of sellers they have and current set up of everything, so sales stay the same. Believe it or not, some brands would rather not read this article and take the time to have a FREE conversation with us about how we can increase their sales for FREE. The only string attached is we would need to be an exclusive authorized seller for that particular product.
Not much of a string at all is it? Our team jokes that maybe if we told brands we charge the going rate of $1000 listing optimization fee, plus $200 per month PER PRODUCT, they would be less skeptical and more willing to let us help them for FREE. Another mental roadblock that brands face is the idea of having the difficult break up conversation with their long time Amazon sellers.
Either a seller is helping your brand, or hurting it by preventing it from growing . As I mentioned before, if those seller are small B&M or online sellers, they are hurting your brand by preventing an exclusive seller with a strategic plan from spearheading sales. If they are large volume seller, then they don’t care about your brand as much as you think they do and will move on to the next product after you tell them your decision of consolidating sellers.
There is really no harm in making the best business decision for your brand and company by letting existing sellers know the new direction you are planning on going.
Increasing sales by eliminating sellers and going with an Professional Exclusive Amazon seller is the way to increase sales on Amazon. By giving these non value adding sellers the boot, sure you might encounter a few bitter and upset sellers here and there, but its human nature to get defensive during a moment of rejection.
The bottom line is, you have to do what's best for your brand, business, and family.
Partnering with a seller with the knowledge, expertise, dedicated staff, business model and mission is conducive to the environment brands want. Our Interests will be aligned creating a win-win leading to more sales by better representation.
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