Brands have a lot of reasons for working with Amazon
According to a survey from Feedvisor, brands are looking to use Amazon.com for many reasons beyond simply selling products.
When asked about their top business strategies for Amazon, 62 percent said they use the channel to drive sales, but close behind was the need to acquire new customers, 60 percent; and to build brand awareness, 58 percent.
Outside of those three top responses related to the sales funnel, the next most important way brands are using Amazon is to “Identify My Competitors,” cited by 41 percent. When asked about their top source of competition, 37 percent of brands cited national or global brands, followed by direct-to-consumer brands (25 percent) and Amazon’s private labels (21 percent).
In this way, Feedvisor wrote that brands are looking to “receive insights on their current competitive arena, nix competitors that are not actually a threat, and truly understand who may be stealing demand or market share from them.”
Brands are also using Amazon for product liquidation, cited by 40 percent; product testing, 39 percent; and to run promotions, 31 percent.
Feedvisor’s second annual analysis, “Brands and Amazon in the Age of E-Commerce,” was based on a survey of more than 1,000 U.S. brands.
Other findings from the survey:
- Seventy-three percent of brands advertise on Amazon, up from 57 percent last year. Over half (54 percent) of brands selling on Amazon believe there is a “great deal of value” in Amazon advertising.
- Seventy-two percent of 1P Brands (Amazon acts as the retailer in the traditional wholesale arrangement) want to expand to Amazon’s 3P Marketplace (sell directly to consumers via Amazon Marketplace).
- Fifty-four percent of brands selling on Amazon said e-commerce marketplaces are their greatest source of opportunity. For nearly half (42 percent) of brands surveyed that have an Amazon presence, the platform represents more than half of their e-commerce sales.
- Brands and Amazon in the Age of E‑Commerce – Feedvisor
- Brands’ Business Goals on Amazon Are More Than Just Sales – Marketing Charts
DISCUSSION QUESTIONS: If you were a brand manager, what would be your top reasons be for selling on Amazon? Are the priorities for brands selling on Amazon similar or different than selling on Walmart, Target or any other online platform?