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4 minute read

4 minute read

How Can a Small eCommerce Business Compete With Amazon

How to Compete With Amazon

This week we will talk about one of our most popular topics, which is how to compete with Amazon. Amazon is a billion-dollar company. There are other billion-dollar companies, such as Sears, Home Depot, Wayfair, jet.com, and Walmart. You as an eCommerce owner might be competing with them on a daily basis.

Online Stores And Market Share

When we ask clients about this, we say, “Are you competing with Amazon?” What’s their answer, usually?

They say that they’re not. Despite this statement, over 90% of eCommerce stores out there are competing with Amazon.

Many of these store owners are delusional. They think that they’re selling a unique product or brand. That’s not true. In fact, there’s one product or brand just like it and cheaper on Amazon.

Amazon has grown to what they are now as a corporate giant. Now that we know what the customer tendency is, I might find a product on your site. The first thing I do is see if it’s cheaper on Amazon.

If you find a product on a site that you’re not familiar with but you know the brand, you go back and you type it on Amazon. We see this happening multiple times through our tests that we do with clients.

Beating Amazon

The question for the eCommerce owners here is, “What are you doing differently that Amazon is not doing?” Nobody wants to answer. Amazon is your keyword and product competitor, because if you search for any, any eCommerce product online, you’ll see the top results 95% of the time: Amazon, Sears, Walmart, Jet, Wayfair, and House.

The answer becomes, how do you compete with Amazon? The first response to that is, are you selling on Amazon right now? If so, are you competing with yourself?

You find a product on the website, Google Search, Facebook, or social media. Then you go back to Amazon because you can get it in 24 hours. Why would I wait?

Do you kill your own competition? Are you cannibalizing your own sales?

Absolutely. If you are selling on Amazon, you have to look at your website, platform and the offerings that you have on your site.

Can you offer free shipping? Are your products or are your items too heavy? What’s your margin like? What kind of functionalities can you offer on your site that makes you better than Amazon?

We deal with a lot of clients who have B2B functionalities, custom ordering functionalities, advanced search and filter, and pre-checkout upsell. The direct answer to the question of, “How can I compete with Amazon?” is really twofold. One through your marketing strategies, and one through the custom and platform functionalities that you might have.

The Competitive Advantage Of Amazon Prime

At the end of the day, that’s what Amazon does. They have a platform that’s really, really fast. They have really good functionalities, pricing, and care for their customers.

With Prime, they can send orders rapidly with two-day shipping. They can ship products to you and have you receive them a lot faster.

Why are eCommerce owners who sell on Amazon and who also sell on their sites so upset at Amazon?

The majority of the orders are coming from Amazon. Therefore their margins are going to be a lot smaller. Amazon takes up to 30%. in addition to that, Amazon will essentially, once you start to do very well, compete with you directly.

If you’re starting to sell a product extremely well, guess what? Amazon might, if they have the ability, create that same exact product and sell it. We’ve seen it before with Amazon Basics and Essentials. You are the guinea pig on their platform.

Dead Product Categories

They killed the cell phone accessories industry. Amazon executives find products and niches that sell really well. Then they’ll go ahead and manufacture their owns, and those are going to be at the top with the buy box, the most ratings, the most reviews, and the highest visibility.

If you are getting more than 30% of your revenue from Amazon, you’re incredibly vulnerable as an eCommerce store. The number one thing you need to do is invest on your website. Invest in your visibility, organic search, functionalities, and core customers.

We always ask this: “What do you do that Amazon does not do? If I come to your site, how do you make my experience better than Amazon?” That’s essential.

Gain That Profit Margin

We’re saying something really aggressive here: “How can you compete with Amazon?” It is possible because remember, Amazon is a big company. They are going to move slowly.

You’re a smaller company and can move a lot faster. To compete with Amazon, you have to be big, bad and bold. If you cannot be those three Bs, you will not be able to compete with Amazon.

We have to do the same thing while competing with thousands of agencies and marketing companies. I have to be big, bad, and bold.

How do I become big, bad and bold?

I can come to any eCommerce company and say, “Well, I can find $1 million in sales for you within the first 30 days. And within a six-month execution, I can make you ROI positive for the money that you’re invested with me. Or if I can’t do that, I’m going to work for the next six months free.” You need to find out what is big, bad and bold to be able to compete with Amazon.

How can you have your website try to do better than Amazon in terms of your own niche products? What is the solution here for the average eCommerce owner?

You need a strategy. You already know what the issue is: “I’m selling the majority of my products on Amazon. Amazon’s taking 30%. If I can just get the same amount of sales and revenue, I would obviously be generating, I have higher profits.”

Who can put together a strategy?

You’re going to need a marketing expert who knows how to grow your site organically. Hire a PPC expert that knows how to target, either on Facebook, Google, Google Shopping or Google Pay Per Click to increase your paid traffic.

Experts On Small Business Strategies

Always defer to specialists. You’re not going to be able to do it yourself as an eCommerce store owner. Why? You’re too busy running your business. Experts help you implement this strategy and move forward if you want to compete with Amazon.

You’re going to need a strategy. It’s not easy. If it were, everybody would do it, and that’s exactly how you differentiate yourself from the competitors, including billion-dollar ones like Amazon. We’ll talk to you guys next week.

Are you struggling to compete with Amazon?

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A digital marketing strategy is the path to profitability. Optimum7 can help you set the right goals, offer and implement creative and technical strategies, and use data and analytics to review and improve your business’s performance.

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