The rate of change has never been greater — or faster — for the footwear industry, with new challenges popping up every day in nearly all corners of the business, from navigating cash crunches and supply chain issues to understanding the latest technological advances. In its “Ask An Expert” series, FN asks industry leaders — all solutions-based providers — to take on some of the most timely topics.
Selling online doesn’t just look like operating a brand website anymore. The growth of digital marketplaces, from Amazon to eBay to Facebook, have opened the doors for smaller businesses that could benefit from the infrastructure of a larger platform. But these sites host a large number of merchants, which means the competition is fierce. In order for a retailer to win sales in a crowded marketplace, they need to know how to navigate these landscapes.
Chris Palmer, CEO of strategic marketplace partner SupplyKick, spoke to FN about the differences between DTC and online marketplaces; how to stand out on a multi-vendor platform; and some best practices for marketplace selling.
What is it about online marketplaces that can make them a valuable revenue channel for retailers?
Online marketplaces continue to outperform the retail sector and became even more crucial when the world went remote. Put simply, they allow retailers to grow their funnel of potential customers and market to them. It’s a no-brainer for any business hoping to meet its customers exactly where they are in their shopping journey—from initial research and review comparison, all the way through to delivery to their doorstep. Savvy retailers tackle Amazon first, which makes sense given $1 out of every $2 spent online in the US is on Amazon; 82% of households have an Amazon Prime membership, and around 50% of total sales go to third-party sellers.
Marketplaces have become the new shopping malls; they serve as a way for brands to attract top of funnel audiences through brand and product discovery. Selling on these platforms also gives retailers the opportunity to own their brand story and win business that will inevitably go to someone else—because another seller can sell your exact same, or very similar, product.
How does selling on this kind of multi-vendor platform change the approach for retailers?
Chances are, if your business isn’t engaging with the marketplace (and your customers) in the right way or isn’t on the platform at all, other sellers or competitors will take that sale —which could do a significant amount of damage to your brand in the process. Retailers need to focus on taking control of the situation—and by that, I mean brand control. Brands need to monitor unauthentic products and unauthorized sellers, and consider enrolling in important programs such as Amazon Brand Registry and Amazon Transparency.
Retailers also need to make sure their visual elements and messaging are the same across the platform. Many sellers take an ad-hoc approach to their listings: They create the elements in silos, resulting in a disjointed brand and customer experience. But marketplace consumers now crave authenticity, consistency, and trust from the brands they purchase from, which means you should treat your marketplace store and marketing strategy with the same care, cohesive approach, and attention to branding as you do your own website, social media, and other channels.
Marketplaces like Amazon are becoming increasingly crowded. What are some easy steps for retailers looking to differentiate their presence on the site?
Carry unique items not everyone is selling and if you sell mostly seasonal or trendy products, sell at least a few basics that can be bought year-round to keep cash flow consistent in your off-season. In order to increase your chances of winning that purchase, leverage provided services like Fulfillment by Amazon; FBA gives you access to many of the reasons why shoppers love Amazon in the first place, such as free 2-day shipping, which can add value that you or your competitors may be unable to provide yourselves.
Then it’s about positioning yourself well. Remember that good ratings and reviews are key for online marketplaces! 82% of consumers specifically seek out negative reviews when making a purchase—making it that much more important for your positive reviews to shine on your listings. Don’t underestimate the power of regular Amazon SEO and keyword research, as well as paid traffic to your listings and Amazon Store. And invest in organic video on your listing, as well as Sponsored Video Ads. Amazon shoppers who watch videos are 3.6x more likely to purchase the product.
How can merchants improve their visibility when listed under the name of a much bigger company?
It’s important for merchants to understand that Amazon is not interested in the visibility of your business—they’re interested in the visibility of products on their marketplace. These marketplaces aren’t designed for building a loyal customer base. Many Amazon shoppers likely think Amazon is the seller, whether they are or not; they don’t say, “I bought this from X brand!” but instead say, “I bought this on Amazon!”
To gain visibility and broaden your reach, regularly research your audience, competition, reviews, and keywords on the marketplace to make sure you’re keeping up with their algorithms as well as what the customers are specifically searching for. This is also true for advertising, which should include both on-platform (Sponsored Products, Brands, Display Ads) as well as off-platform promotions (social ads, influencer marketing or endorsements) that send traffic to your Amazon store and listings.
How can merchants cater to the growing consumer desire to support small business, while still running their stores on a large-format platform like Amazon?
Effective branding and storytelling is key. Brand marketing is one of the most important investments you can make to win over consumers who want to support small businesses during their Amazon search. The great thing about Amazon is you don’t have to have a brick and mortar presence to be successful on the marketplace. Whether you’re big or small, you have an equal chance at a share of voice as long as your product is desirable, your brand is visible, and you’re transparent with your customers. Teaming up with a reputable seller and agency doesn’t hurt either.