Fact: 55 percent of all online product searches start with Amazon.
Fact: There are more than 550 million products for sale on Amazon.
Fact: 3,500 new anonymous 3 party (3P) sellers join the Amazon marketplace everyday.
This last stat is a real doozie: By virtue of their anonymity, 3P sellers can wreak havoc with pricing, branding, customer experience, warranties, and distribution. If brands are not managing this channel, they’re giving away money and risking brand integrity. And even if they are, the anonymous aspect can make it feel like an unwinnable, unfun whack-a-mole game.
Combatting the biggest threat, part 2
In this special podcast series, SNEWS partnered with Kristin Carpenter-Ogden, founder of Verde Brand Communications and the Channel Mastery podcast to explore all sides of this all-important issue.
In our first episode, we spoke with David Howell, who investigates and ultimately snuffs out anonymous 3P sellers on behalf of his brand clients, and Terry Lee, founder of Gear Coop, the most established authorized 3P seller of outdoor gear on Amazon.
In this episode, we hear from Jon Rockefeller, managing director of the sport business for Petzl America and a 30-year veteran of the outdoor industry and Fred Dimyan CEO of Potoosolutions.com, a firm that specializes in protecting brands on online marketplaces.
By the end of this episode, you will understand how and why anonymous 3P sellers are such a big threat to your business and you’ll have an understanding of your options for moving forward to clean up your Amazon channel.
The 5 big takeaways from this podcast
1 - Creating an experience’ is retail and branding 101. Remember that the channel is not only part of the experience, it may be the most influential part.
2 - The goal of channel management should be a “healthy” industry. This doesn’t necessarily mean perfect or always fair.
3 - The complexity of this problem can’t be overstated, but it needs to be understood. Fred identifies several key elements that increase the complexity: counterfeits, price parity, direct factory brands going to Amazon (online-only brands), marketing and merchandising for online first (not brick and mortar),
4 - One reason this is such a tough topic is because consumers love Amazon. Consumer-centric strategies suggest brands need to be there. Anonymous 3P sellers erode brand integrity, but the consumer doesn’t know until there’s a problem (with warranty, with counterfeit product, etc.).
5 - Potential solutions: Brand presence on Amazon (taking control of your catalog and make it look like your website), ensuring products are Prime, outsourced enforcement of anonymous 3P sellers, industry wide campaign education campaign around counterfeiting and where to buy, evolution of price acceptance across the entire supply chain.