Have you ever wondered whether it makes sense to sell internationally through your own online store, a network of retailers or e-commerce platforms? The latter is an option worth considering for many. When it comes to marketplaces, the first place to look is, of course, where the biggest cash flows are – Amazon. We listed 8 reasons why Amazon is an option worth exploring more closely.
1. The overwhelming volume of customer traffic
There’s an old saying that a seller should go where the customers are. First, customers moved from brick-and-mortar stores to larger shopping malls with plenty to offer. The same pattern was repeated for online retailers, with customers moving from individual online stores to centralised, best-serving e-commerce platforms. The largest and most important of these is Amazon.
Globally, the customers targeted by e-commerce are already on Amazon. They often lack the enthusiasm to try new channels. In the US market in particular, there is a saying that speaks to the power of the marketplace: if you’re not on Amazon, you don’t exist.
Amazon enables a cash flow, growth and potential that is not available anywhere else.
2. Customers go to Amazon too
When customers search for information, they open Google’s search engine. When they want to buy, they go directly to Amazon. So customers are already on Amazon and are looking for products there because they know the scope of the site. There aren’t many things that you can’t buy on Amazon.
But to have your own online store, you have to get the customer traffic at your own expense first, and then you can start selling.
The conversion rates for sales and advertising on Amazon are not what you are used to on your own online store. Depending on the source, the average conversion rate on Amazon is 10-15%.
3. The ultimate logistics pioneer
Customers want to receive their orders quickly and reliably. Amazon has succeeded in building the world’s most efficient logistics chain, delivering products to customers’ homes within hours of ordering. Through Amazon, the brand can use this significant competitive advantage in logistics as a key driver.
Amazon has invested and will continue to invest huge sums in logistics development, including buying its own ships and planes during the Covid pandemic to meet external logistics challenges, in order to deliver on its high customer promises.
Building an equivalent level of logistics chain in your own online store or in your retailers’ supply chain would be difficult – and expensive. Storing products on Amazon is cost-effective for the retailer.
4. Rock-hard credibility
Amazon as an online store is more reliable and credible for the customer than the brand’s own online store. Customers trust Amazon’s service and therefore prefer to buy from an environment where they can rely on Amazon’s service in all situations. In particular, a smaller brand’s own online shop does not have this advantage.
Credibility is also established on Amazon through reliable product reviews. In other channels, customers cannot rely as much on the objectivity of customer reviews from people who have actually bought products.
5. A global trendsetter
Amazon provides a wealth of information on different markets and allows the potential of a product to be verified even before a sale is made. It’s easy to keep up with current trends and easily customise your own product ranges to match customer preferences.
Amazon is the world’s largest data pool, providing information on product sales, competition, pricing, quality, customer experience and product potential.
6. Fast scalability
Amazon enables brands to scale quickly as they grow in volume and expand into new markets.
Expanding into multiple markets, scaling markets and opening new markets is quick and easy. For example, with EFN, the European Fulfillment Network, one of the sales channels in the FBA model, a seller can expand its market reach to more European Amazon markets, even if products are physically stored in only one country. It allows you to start your Amazon journey in a European market, for example in German Amazon, but at the same time you can also lightly test the appeal of other European Amazon markets and put additional efforts into new, attractive markets.
7. Other channels are also opening up through Amazon
Amazon will support the sales and marketing of other sales channels and the discovery of retailers in new markets. For example, large retail chains actively monitor the success and demand for products on Amazon, so in addition to just selling on Amazon, operating on the Amazon platform can also attract larger network partnerships.
Amazon enables cost-effective internationalisation and future growth that is easy and quick to prove.
8. Even smaller brands have a big opportunity on Amazon
On Amazon, smaller brands have an equal opportunity to compete with big, well-known brands. Product branding, features, differentiation, quality, customer feedback and Amazon algorithm expertise are key factors in competing against the biggest brands.
Are you considering selling on Amazon? Feel free to contact us! Your Amazon Partners can help you make the most of the world’s largest shopping platform.
