The brands represented at IHA 2019 demonstrated a strong understanding of Amazon and online retail. Many of our conversations revolved around the pros and cons of the three business models for selling Amazon and the positive impact an exclusive seller partnership can have on sales velocity, especially when launching a new product.
Learning how to play to the unique strengths of ecommerce and B&M in tandem provides a huge strategic advantage. Here are some of the noteworthy practices we saw and discussed at IHA:
Leveraging Ecommerce Opportunities
B&M locations will always be important for home products because people like interacting with furniture and décor as they imagine it in their own homes. The challenge with B&M stores lays in the limited ability to represent product variations. Floor space is finite in physical stores, and even large B&M retailers must decide which colors, sizes, and bundles they carry.
Selling online allows home and housewares companies to display their full catalog of variations and bundles. These variation listings tend to perform well online, as online shoppers’ desire for additional choices counterbalances their inability to interact with the products in-person.
Innovative Solutions to Breakability & Supply Chains
Of course, ecommerce isn’t without its challenges. One of the most common issues for the home and housewares industry is products breaking during transit or while in an FBA warehouse. At IHA, we saw examples of stronger product packaging designed to minimize product loss.
Another common challenge is B&M sellers listing products on online marketplaces to offload unsold inventory on Amazon, and they don’t always inform manufacturers. This practice can harm brand’s online integrity by undermining their online pricing, and it’s extremely difficult to identify who is violating the pricing policy.
One brand created a clever solution: different colored packaging. They provide white packaging to their B&M retailers and gray packaging to their online retailers. The different package colors (which also have different UPCs) keeps their Amazon channel clean because B&M retailers cannot send inventory to FBA without alerting Amazon. If a B&M product is sold through Amazon, customers receive a product that doesn’t match the listing photo, and Amazon will identify the product as incorrect or a violation.
And a Dash of Fun
We had a great time at IHA this year, both in and out of the show. In between conversations and visiting booths, we managed to find time to sample Chicago dogs and deep dish pizza, visit a jazz club, and listen to local musicians. We even got to meet actress and Food Network star Ayesha Curry!
As ever, we loved meeting with our partners and learning more about the industry’s obstacles and opportunities so we can help brands address them.
###