Selling on Amazon

What is Amazon

Amazon is the most popular generalist e-commerce platform on the planet. It serves over 180 countries, receives nearly 200 million visits each month, and has over 300 million registered users.

Born as an online bookstore, it is now a must-have online sales channel for most brands.

Forty-nine percent of searches for a product on the web start right from Amazon (36 percent on search engines such as Google).

The variety of offerings, competitive prices, impeccable logistics, and the “customer first” approach are the key elements on which Jeff Bezos’ giant has built its success over the past decade. A decade in which Amazon has been able to raise users’ expectations and needs, providing them with faster and faster shipments, increasingly efficient services and innovative experiments.

These include tests on deliveries by drones or in the luggage of one’s car, intellectual property protection services, theapp to scan items and buy them in the platform, or the system that allows smart objects in the home to buy on their own.

Users can sign up for a free Amazon membership or subscribe to Prime and get free 1-day delivery on 2 million products, access to streaming music, e-books, movies and TV series, unlimited photo storage space, and preview access to flash deals.

Why sell on Amazon

• Amazon’s numbers speak for themselves. This is a golden opportunity for brands to connect with millions of potential customers. An unthinkable result to achieve with other platforms or with their own e-commerce.
• Almost one in two users search for a product directly on Amazon. So it is a key channel for getting found by potential customers.
• Amazon product pages convert on average 5 times more than e-commerce product pages (especially if it is an unestablished brand)
• Amazon enjoys the full trust of its users. Trust that, due to the halo effect, also “transfers” to the products offered, especially if they carry the label “sold by Amazon” or “shipped by Amazon.”
• Selling on Amazon means ensuring extremely fast delivery times, another positive factor that reduces the friction to purchase.

How to sell on Amazon

There are three strategies for selling on Amazon:

• Vendor strategy: the brand sells products to Amazon, which resells them to end users. In this case, the brand loses all control over the final price and published content.
• Seller Strategy: the brand sells products on Amazon, taking care of all stages of the sale: from catalog publishing to shipping, from customer service to returns.
• Rely on a Specialized Seller that holds the technology, expertise, fiscal requirements, and experience necessary to enhance marketplace penetration

The Professional Guide “Amazon: which sales strategy is best for your Brand” delves into all the benefits and risks of each option.

What to sell on Amazon

Amazon is a generalist platform, thus suitable for selling everything from clothes to do-it-yourself tools. Fashion represents one of the most purchased categories online. It is no coincidence that Amazon dedicates an entire section to it, which in Italy is called Amazon Moda. Among the most searched categories are:

• books (capturing the interest of 16 percent of users)
• health and beauty (12%)
• electronics and accessories (11%)
• home and kitchen (10%).

Food represents a new category in which the marketplace is focusing. With its Amazon Prime Now service (in Italy available in some cities such as Rome, Turin, and Milan), the platform guarantees delivery of fresh produce within two hours.

Amazon.co.uk also devotes an entire section to Made in Italy.

How much does it cost to sell on Amazon

Amazon envisions two sales plans:

• Basic Account: designed for small sellers. The service is free, but subject to severe limitations on the number of items that can be posted. Amazon charges a variable sales commission (6 to 20 percent) plus a fixed fee of €0.99
• Account Pro: suitable for professionals, at a cost of €39/month plus commissions on sales, varying according to product category.

Amazon shipping and returns

In the case of a Vendor Strategy, as mentioned, Amazon handles all stages of the sale. Sellers, on the other hand, can ship orders independently or rely on Amazon FBA logistics. In the latter case, Amazon is still in charge of all aspects: from shipping to returns, including multi-language customer service. With FBA, products are allocated in Amazon warehouses but-if needed-may be shipped to other channels.

In addition, thanks to Amazon’s Pan European Program, products handled under FBA mode can be shipped throughout Europe at the cost of local shipping. In the FBA model, in addition to sales commissions (which depend on the category and market), the Seller pays logistics fees, consisting of handling and storage costs.

At Amazon, returns are free and can be made within 30 days of delivery.

How to promote products on Amazon?

To increase visibility and sales, Amazon provides several marketing tools, including:

• Sponsored Brand: ads that show the brand logo, a custom title and up to three products. They appear in connection with a search, then are triggered by keywords. Sponsored Brands are available to any brand, retailer or agency registered with the Amazon Brand Registry (Brand Registry).
• Sponsored Product: listings that show one or more product pages among the search results. They are triggered in relation to a specific search (example “sports shoes”). Sponsored products appear along with organic results.
• Stores: multi-page digital spaces dedicated to a single brand. Only those with Brand Registry can open an Amazon Store.

This article delves into all the marketing tools to increase visibility and sales on Amazon.