Scissors cutting price tag

One of the most frustrating experiences as a brand owner is seeing copycat competitors undercut your pricing. In retail, competition is healthy because it forces businesses to innovate, resulting in better deals and products for consumers. However, sometimes it’s not a matter of two quality products vying for patronage. In some cases, it’s a high-quality product being undercut by a low-quality product.  

There’s not much that brands can do about competitors’ prices, but there’s plenty they can do to convince shoppers that the higher cost of their product is well worth it.  

How to Defend Against Competitors Undercutting Pricing 

#1 – Highlight What Makes Your Product Better 

On Amazon, customers have many choices when looking at products. A simple and free way to help your products stand out is to promote your differential features in the copy, images, and A+ Content. Differentiators are features that make your product different from your competition, such as location of production, quality of materials, performance, additional features, aesthetics, or warranties 

#2 – Use Amazon Live 

Amazon Live is an Amazon service that allows sellers to broadcast livestreams in which they demonstrate product usage, features, and benefits. Featured products appear directly below the live broadcast window. Brands can use Amazon Live to share their story, live events, educational content, and so much more. Customers on Amazon Live can ask questions and receive answers in real timeAmazon Live allows customers and brands to connect on a more intimate level compared to a video or listing and is an excellent (and free) way to increase visibility. 

#3 – Engage with Your Audience on Social Media 

Social media is one of the most powerful tools that brands can leverage to grow their audience. When we talk about social media, were meaning Facebook, Instagram, Twitter, LinkedIn, Snapchat, TikTok, YouTube, and so many more platforms.  

Brands can use social media in many ways, but one of the most important uses is actively engaging with your customer base. This means responding to comments in a timely manner, creating social posts that invite your audience to actively participate in a discussion, and responding to all direct messages. Audiences want to feel a connection to a brand, and engagement on social media is one of the top ways to do so.  

Most importantly, a strong social media presence builds brand trust. Consumers are more educated than ever, and social media is a big part of that education. They’ll initially turn to your social channels to ensure your brand is legitimate but they’ll stay to engage with your brand on a personal level.  

If you need assistance in growing your brand’s social presence, look into our social media management service.

#4 – Respond to ReviewsComments, and Questions on Listings 

When managing many listings, responding to each and every review and comment can seem dauntingHowever, responding to your customers, regardless of whether their feedback is positive or negative, is critical to differentiate your brand from competitors. Responding to questions, praise, and criticism takes time and energy, and not everyone is willing to do it. By taking time to respond to customers in a timely manner, you demonstrate that your brand cares about your customers, and shoppers will favor you for that. 

#5 – Represent Your Brand Consistently Across All Sales Channels 

Consistent representation across all sales channels is often overlooked, but it’s incredibly important for maintaining brand integrity and strong customer relations. Inconsistent representation can lead shoppers to question quality and product authenticity.  

Brands should seek to maintain a consistent brand name, brand voice, high quality copy and images, and prices across online marketplacesThis ensures you provide a fantastic customer experience with your brand, no matter where shoppers find your products. By doing so, you cultivate a reputation as a reliable brand that cares about your brand, products, and customers. 

#6 – Be Where Your Consumers Are 

The ecommerce landscape is constantly changing. In order to stay ahead of your competitors, you need to meet shoppers where they’re at. In today’s age, that means listing your products online, such as on Amazon, Walmart, and Google Shopping. As mentioned above, that likely also means curating an active presence on social media. In addition to posting and responding regularly, consider running social media ads and leveraging influencer marketing. You competitors may simply wait for shoppers to find them, so you can get a leg up by getting directly in front of shoppers, no matter where they’re at. 

Amazon Q3 2020 Earnings Report

Today, Amazon released their Q3 earnings report. Amazon’s net sales this quarter grew 37% year-over-year, down from 40% YoY growth in Q2 but still staggering, nonetheless. Other highlights from the earnings report include: 

Overview

  • Operating cash flow for the trailing 12 months increased by ~$20 billion compared to the same period last year, up 56% to $55.3 billion 
  • Operating income nearly doubled YoY, up from $3.2 billion to $6.2 billion 
  • Amazon’s net income tripled YoY, up from $2.1 billion to $6.3 billion 
  • Amazon reports that it has created over 400,000 jobs globally in 2020 
  • Amazon Sweden launched yesterday, October 28

Segments

  • Third-party seller services grew 55% YoY 
  • First-party sales grew 38% YoY 
  • The “Other” segment, which consists largely of advertising revenue, grew 51% YoY, demonstrating that advertising revenue continues to be one of the fast growing segments
  • AWS grew 29% YoY, on par with growth in Q2 (the last two quarters are the slowest growth rate in the last 3 years) 

Other 

  • Subscription services are up 33% YoY 
  • Shipping costs are up 57% YoY 
  • Amazon’s logistics and fulfillment square footage is expected to grow 50% YoY in 2020
  • Amazon expects net sales to grow between 28% and 38% YoY in Q4 

A Record Breaking Quarter

At $6.3 billion, Amazon’s Q3 earnings shattered records, the previous record being $5.2 billion in Q2 this year. To not appear to benefit too greatly from the pandemic, Amazon has pledged another $4 billion to COVID-19 costs for the fourth quarter. It’s also worth noting that on Prime Day, which occurred in October this year, that Amazon did not appear to struggle with fulfillment. Their logistics success on Prime Day is reassuring as sellers head into the holiday season.

Amazon’s earning report covers much more, delving into Amazon’s contributions to communities, job growth, climate change, Amazon products, Prime Video, AWS, and more. As an Amazon seller/agency/software provider (we do a lot), we’re going to focus this coverage on what the report suggests for brands selling on Amazon. 

Our biggest hot take: Amazon’s feeling the heat from the antitrust investigation, and is taking time in this earnings report to try to deflect or minimize some of the allegations laid against it. 

Amazon Tries to Deflect Antitrust Concerns 

On July 29, 2020, Amazon founder and CEO Jeff Bezos testified before a congressional antitrust committee. Amazon also supplied written answers to the committee’s questions on September 4. The committee published a 450-page report on October 6 with their findings from a 16-month antitrust investigation into Amazon, Google, Facebook, and Apple.  

For those who listened to Bezos’s testimony or read the aforementioned documents, it’s easy to see that Amazon is making a defense for itself within its Q3 earnings report. We’ve broken down some of the most notable references to the antitrust concerns.  

Does Amazon Hinder S&MB Growth? 

Amazon has been accused of stymieing the growth of small and medium-sized businesses. In this earnings report, as with previous reports, Amazon points to its efforts to support small and medium-sized businesses, including: 

  • Amazon Accelerate, a program that teaches business owners best practices for selling on Amazon 
  • Ignite Digital Festival, an event for delivery service partners offering best practices and updates for logistics 
  • Stand for Handmade, a program in India that waives selling fees for local, handmade products 
  • Amazon Launchpad Innovation Grants, a program in Australia to provide grants to start-ups and S&MBs 

Amazon Takes Majority of Prime Day Sales 

During the antitrust hearing, Amazon faced questions about unfair usage of third-party data and unfair competition against third-party sellers by Amazon’s first-party retail segment. 

In their earnings report, Amazon makes a point to state that on Prime Day, third-party sales grew 60% YoY, up to $3.5 billion, “growing even more than Amazon’s retail business.”  

This note seems to be a defensive move by Amazon, as others have noted that Amazon’s firstparty sales hit an estimated $7 billion and accounted for 60% of all Prime Day sales. In year’s past, first-party sales accounted for closer to 40% of all Prime Day sales. Third-party sellers may have grown at a greater rate than Amazon’s retail segment, but Amazon took a far larger slice of the Prime Day pie this year. 

Amazon’s Efforts to Protect Brands & Consumers 

Amazon also drew attention to Project Zero, announcing that the tool is available in 17 countries around the world. Project Zero allows brands to remove alleged counterfeit sellers from their listings themselves, without going through Amazon’s approval process. The program has been historically difficult to gain access to.  

Bezos referenced Project Zero during his testimony when asked about what Amazon is doing to protect brands and consumers from counterfeit products.  Mentioning it again in the earnings report helps send the message that Amazon is continuing to expand its anti-counterfeit efforts.

Marketplace Earnings Reviews

Read our breakdowns of Amazon’s Q2 Earnings Report, Walmart’s Q2 Earnings Report, and Target’s Q2 Earnings Report.

Amazon Brand Registry Roles

The Amazon ecosystem is getting more competitive and complex each day. Counterfeit goods slipping into listings and rising marketing costs are just two of the many issues brands face when selling on Amazon. Luckily, one tool brands can use to overcome some of these issues is Amazon Brand Registry.

What is Amazon Brand Registry?  

Amazon Brand Registry is an Amazon program that provides brands additional protection and access to other marketing services, including: 

Enrollment in Brand Registry is free but requires a trademark registration number with the United States Patent and Trademark Office (USPTO). Learn more about all the benefits in our Always Up-to-Date List of Amazon Brand Registry Benefits. 

What are Amazon Brand Registry Roles? 

One big issue for unregistered brands is the lack of control over their listings. When your brand is not part of the Amazon Brand Registry, unauthorized sellers can come into your listing and change content. As brand trust becomes more important to consumers, it is crucial to maintain control of your listings.    

When brands are brand registered with Amazon, only authorized accounts can change listings. Authorized accounts can include your employees or another account to which you have assigned a role, such as an authorized agency. There are currently three types of Amazon Brand Registry roles: Administrator, Rights Owner, and Registered Agent. Each comes with a different level of permissions.   

  1. Administrator: An individual who has full permission to assign roles to user accounts.   
  2. Rights Owner: An individual who is the rights owner or an employee of the rights owner who is authorized to report violations.   
  3. Registered Agent: A third party who is authorized by the rights owner to report violations.   

 

If you wish to give a seller the authority to report violations on your behalf and have extra authority within your listings, you must add them as a Registered Agent, Rights Owner, or Administrator. 

How to Assign Brand Registry Roles 

To assign roles for Amazon Brand Registry, follow these steps: 

1 – On the Amazon Brand Registry platform, click on Brand Registry Support. 

Welcome to the Brand Registry

2 – Click through Update your brand profile > Update role or add new user to account 

Amazon Brand Registry Support

3 – Follow the on-screen form to submit the seller’s email as the role you desire them to have. 

Apply for Amazon Brand Registry 

Learn how to apply to Amazon Brand Registry.

A Chow Chow Wearing Sunglasses and a Kitten

The Pet Supplies category is an emotions category – shoppers buy with their emotions and justify with logic. The joy that comes from delighting a beloved pet or the fierce protectiveness that comes when thinking of their safety – these are grounding factors that must guide your marketing strategy for the Pet Supplies category.    

Pet Owners Seek Trustworthy Brands 

Shoppers in the Pet Supplies category tend to demonstrate high brand loyalty. Shoppers want to trust that the toys, treats, and items they buy for their pets are safe and reliable. Once they’ve found a brand that they trust, they tend to stay with it.  

We see this played out in data, which shows that first-time buyers enter the category using broad keywords, like “dog toy,” while repeat buyers often use branded keywords.   

In the same vein, we also see that shoppers in the Pet Supplies category are willing to pay for quality. Because pet owners want the best for their pets, they’re willing to pay more for higher quality items. This is especially important to consider given that this category struggles disproportionately with counterfeit product. The low production and freight costs often associated with this category make it a prime hunting ground for counterfeiters. 

3 Ways to Tailor Your Amazon Marketing Strategy for Pet Products 

1 – Lifestyle Images are a Must  

Exciting visuals are critical in emotions categories because they are the first step towards inspiring an emotional rapport with shoppersLifestyle images are images that show your product in use in a natural setting. An adorable photo of a dog using your chew toy will delight shoppers and make them want to see that joy in their own furry friend. In many cases, they also help display the size of the product, helping ensure customers know what size they’re buying. 

Dog with Frisbee in park

Recommendations: 

  • Re-use images generated by influencers for your Amazon listings 
  • Include 2-4 lifestyle images and 1 video, if possible, in your Amazon listings 

Read more about the role of images and video for Amazon marketing. 

2 – Tell a Story with A+ Content 

A+ Content is a potent marketing tool in any category, but especially so in the Pet Supplies category. Pet owners value safety and reliability from the brands they patronize. A+ Content is an excellent place to acknowledge and empathize with their desire. Share your brand’s story and values to show shoppers that your brand is worthy of their trust. 

A Plus Content on Amazon

Recommendations: 

  • Create A+ Content for top performing ASINs (requires Brand Registry) 
  • Share your brand story and values 
  • Use additional imagery that shows your products in use 
  • Highlight product features 
  • Include a sizing chart, if applicable to the product 
  • Link to your other product lines through a comparison chart 

Learn more about earning customer trust in a skeptical world. 

3 – Reach Brand-Loyal Shoppers with Sponsored Brand Ads 

Earlier, we identified shoppers in the Pet Supplies category as being brand loyal. We see this played out in Sponsored Brand Ads – banner ads that show the brand name, logo, and several products. Sponsored Brand Ads typically have lower conversion rates than Sponsored Product Ads, but in the Pet Supplies category, we see strong performance because repeat buyers are seeking specific brands. 

Sponsored Brand Ad on Amazon SERP

Recommendations: 

  • Direct Sponsored Brand Ads to your Amazon Store 
  • Bid on branded keywords so the ads appear for repeat buyers 

Learn more about sponsored ad strategy on Amazon. 

The Best Doggone Guide to Pet Supplies on Amazon 

Like what you’re learning? This is only scratching the surface. Our Amazon marketing experts put together a comprehensive Amazon seller’s guide to selling pet products on Amazon. It contains a category overview, top challenges for pet brands on Amazon (and solutions for them)legal and marketplace requirements, and 10 ways to customize your Amazon marketing strategy specifically for the Pet Supplies category.  

Download the guide for free!  

Tips for Influencer Marketing

Online shoppers can’t physically inspect your products before buying them on online marketplaces, such as Amazon, Google Shopping, eBay, and Walmart. As such, recommendations are one of the few ways that online shoppers can connect with your products, and influencer endorsements are one of the best forms of recommendation. Influencers spend years gaining the trust and respect of their followersmaking them ideal advocates for your brand.  

Nowadays, many brands run influencer marketing campaigns. That shouldn’t be surprising, as influencer marketing is one of the best forms of social proof. Their followers trust their actions and guidance within their particular niche. This trust is incredibly valuable to growing brands.    

Influencer marketing campaigns can be challenging to manage and execute, but have no fear. In this post, we’re sharing seven tips for how to manage and maximize the results of your influencer marketing campaigns.   

1. Create Goals for Your Marketing Campaigns  

As with any project, a successful influencer campaign starts with clearly defining goals. Your goals should be tailored to your specific brand, as goals will differ depending significantly on your current social media development level. Common goals among brands include brand awareness, brand engagement, driving traffic to your listings or website, driving sales, or increasing followers for their social media. 

2. Clearly Define Your Goals to Your Social Influencers  

Now that you have clearly defined goals, they need to be communicated to your influencers. If your influencers are not on board with your goals, they are not the right fit for your influencer campaign. Additionally, if your primary goal is to drive traffic to your listings, they need to be aware of that so they can be sure to include all relevant links.  

3. Engage with Your Social Influencers  

Engaging with your influencers keeps them excited about your campaign. Before the campaign starts, message your influencers personally and see if they have any unanswered questions. Also, follow their account and like some of their posts. Start engaging with their brand, so they start engaging with yours. During the campaign, continually message them about their efforts, progress, and results. It is your role to keep them in the loop about changes or errors in their posting. After the campaign is over, thank them and discuss their results. Influencers are not Facebook or Instagram Ads; they’re people, and they need to be engaged to maximize efforts.   

4. Allow Your Social Influencers to Be Creative  

Micro-managing influencer’s content is how influencer campaigns turn into advertising campaigns. Influencers know their audience best. Let your influencers play around with styles, messaging, and so on. The best way to ensure they stay aligned with your goals is to give them the freedom to be creative.   

5. But, Give Them the Specifics 

There are a few specific details that do need to be communicated. This type of communication includes giving them a specific link for your listings or website, how many pieces of content they need to produce, whether the product needs to appear in the post, and so on. These communications should be made before you hire an influencer.   

6. Track Post-Performance Metrics 

Like any marketing campaign, you need to have metrics to see how the campaign performed. In the case of influencer marketing, tracking likes, comments, views, click-through rates, and so on can provide insights into overall campaign performance. Knowing the ROI on your influencer marketing campaigns will allow you to identify what is working and what is not working. If promoting products on Amazon, you can use Amazon Attribution links to associate performance metrics with individual influencers.

7. Create A Relationship with Your Highest Performing Influencers 

Now that your influencer campaign is over, identify the highest performing influencers based around your goals and post-performance metrics. These are going to be the influencers you want to create long-term relationships with. You can do this in several manners, such as asking them to join other influencer campaigns, reposting their content, continuing to engage with their brand, and so forth.   

Looking for Help with Your Influencer Marketing Campaigns?  

Kaspien was the first major third-party seller to combine influencer marketing with Amazon marketing. We’ve spent over 4 years running over 150 influencer campaigns for our partners. Learn more about how we can drive traffic to your listings through influencers. 

More free resources

Bezos answers congressional antitrust questions for house subcommittee on the judiciary

On July 29, 2020, Jeff Bezos testified before the US House Committee on the Judiciary. After the testimony, the committee submitted a list of additional questions for Amazon to answer in writing. The questions and answers were published on September 4th. We’ve reviewed Amazon’s responses in the Questions for the Record and identified some key takeaways for brands and third-party sellers that operate on the Amazon marketplace.  

Does Amazon Steal Third-Party Data? 

One of the most persistent lines of questioning was around Amazon’s use, or rather, alleged misuse of third-party data, including third-party seller data from the Amazon marketplace and third-party data from AWS users. Amazon has been accused of using third-party data to create copycat products and undercut its users’ prices. 

In short, Amazon openly admits to drawing on its enormous wealth of third-party data to improve its first-party offerings. However, it denies targeting any single seller because it anonymizes and aggregates data. 

Amazon responded in multiple instances that Amazon uses anonymized, aggregated data to inform its decisions, including which private label brands and products it pursues. Amazon argued that this is an ability that any retailer has, ecommerce or brick and mortar. Amazon also stated that, like any other seller, its private label developers research public-facing content on listings, such as price, reviews, rank, and features. 

Rep. Pramila Jayapal’s questions pressed Amazon to define “aggregated data” through a hypothetical: If a category consisted of one seller who accounted for 99% of sales and another seller who accounted for 1% of sales, would Amazon deem the combined data “aggregate data”? Amazon’s response that aggregate data is “data that is aggregated across multiple third-party sellers and, where available, Amazon’s first party sales,” suggested that it would. 

First-Party Share of Listings by Category

First-Party Share of Sales by Category

Amazon First Party Share of Sales by Category

 This question and Amazon’s answer are important to note for brands that release innovative products. Even if Amazon reviews data at a category level (and Amazon did not specify how deep category levels go for their product development purposes)successful products in niche categories are particularly vulnerable to copycat products based on Amazon’s aggregated data and frontend research. 

Does Amazon Unfairly Favor First-Party Products & Services? 

The Buy Box 

Chairman David Cicilline asked if Amazon considers profitability to Amazon when determining which seller wins the Buy Box. Amazon responded that profitability to Amazon is not a factor. Instead, factors such as price, delivery speed and cost, Prime eligibility, and seller performance determine Buy Box ownership. These factors are all things prioritized by Amazon first-party products. 

FBA vs Non-FBA Offers 

Cicilline also asked if Amazon favors products fulfilled through Fulfillment by Amazon (FBA) are favored over non-FBA options. As with nearly every answer, Amazon responded in a roundabout way, stating that Amazon’s data shows that customers prefer orders with FBA over non-FBA orders by 9.46%. This answer suggests that, yes, Amazon does favor FBA orders over non-FBA orders, but justifies it by claiming it provides the superior customer experience. 

However, this may change in the coming fourth quarter, as Amazon has been forced to impose inventory constraints across its fulfillment centers due to being unable to meet the surge in ecommerce purchases caused by COVID-19Since inventory space is limited and in high demand, Amazon is focusing on higher-volume, faster turning ASINs, as well as higher-profit items, to ensure that products stored in Amazon fulfillment centers (FC) are worthwhile for Amazon. 

The Amazon FC capacity constraints has driven many third-party sellers to establish hybrid fulfillment strategies for Q4, combining FBA with Fulfillment by Merchant (FBM). 

Purchases Through Alexa 

Cicilline also submitted questions about what ratio of first-party products are sold through Alexa compared to third-party productsAmazon stated that third-party sales account for 45% of sales made through Alexa in 2020, despite accounting for 58% of sales of physical products on Amazon. Amazon stated this discrepancy is due to the fact that many sales on Alexa are for consumable household items, like paper towels and diapers, and Amazon has a larger first-party presence in this category. 

Amazon also stated that only a low, single-digit percentage of customers complete the purchase of a product suggested by Alexa on Alexa. The clause “on Alexa” is worth noting, as it implies that the conversion rate for Alexa-recommended products could be higher if one tracked sales made on other devicesWhen Alexa recommends a product, shoppers may look it up on their phone to view pictures and read reviews, then purchase from their phone. Such conversions would not be counted in the low, single-digit conversion rate provided by Amazon. 

Does Amazon Do Enough to Protect Brands & Consumers? 

Project Zero Allows Brands to Remove Counterfeits 

Representative Henry Johnson, Jr.’s line of inquiry focused on brand protection services available to sellers on Amazon, and by extension, consumers who shop on Amazon. His first line of questioning focused on Project Zero, an Amazon program that gives brands the power to take down counterfeit listings themselves. 

According to Amazon, to be eligible for Project Zero, a brand must have a registered trademark, an Amazon account with access to Brand Registry, and have maintained an accuracy rate of higher than 90% for all notices of infringement submitted to Amazon in the prior six months. Requiring a high rate of accuracy for notices of infringement is critical to protecting honest sellers from abusive removals. 

Amazon stated that currently, 10,000 brands are enrolled in Project Zero. When challenged why brands should have to police Amazon’s marketplace for it through Project Zero, Amazon stated that their automated brand protections proactively remove more than 100 items suspected of infringement for every 1 item that a brand owner manually removes.  

IP Accelerator Expedites Trademark Registration 

Responding to questions about protecting intellectual property rights (IPR), Amazon brought attention to its IP Accelerator program, which connects brands with a curated network of trusted IP-focused law firms to help with trademark registration. According to Amazon, this program has connected over 1,500 brands to the network, and over 500 brands have received “accelerated protection” on Amazon. 

Accuracy of Seller Contact Information 

As of September 1, 2020, Amazon requires all sellers to list their contact information on their public-facing Amazon seller profile page. Representative Johnson, Jr. asked Amazon how they plan to ensure that the seller information is accurate.  

Amazon responded that they combine computer and human resources to validate seller contact information. However, many of their efforts seem to occur when a new account is created, so it is unclear how effective Amazon’s systems will be at retroactively identifying inaccurate information in existing seller accounts. 

Does Amazon Knowingly Permit the Sale of Counterfeits? 

Despite a plethora of anecdotes from consumers and brands about a pervasive counterfeit problem existing on Amazon and the Department of Homeland Security’s report from January 2020, Amazon continues to deny that counterfeit products are prevalent on the Amazon marketplace.  

Amazon claims that 99.9% of all products viewed by customers on Amazon do not have a valid counterfeit complaint, although Amazon did not state how it determines which complaints are valid.  

CJ Rosenbaum, founding partner of Amazon Sellers Lawyer, also cast further doubt on the sincerity of Amazon’s claim that it proactively fights the sale of counterfeit product on its marketplace. In an interview with Kaspien’s CEO and Director of Compliance, Rosenbaum shared that his firm recently represented a vendor who knowingly sold counterfeit product to Amazon Retail (first-party or 1P), and that Amazon Retail: 

  • Knew the product was counterfeit and bought it anyways, then sold it to consumers 
  • Simultaneously had an existing partnership with the competing authentic brand 
  • Stopped paying the vendor when the vendor’s account was accused of counterfeit, while continuing to sell the counterfeit product to consumers, resulting in maximum profits  
  • Instructed the vendor to create a new vendor account so that Amazon Retail could place another purchase order, then repeated the whole process several times before the vendor took Amazon to court 

The below video starts at the segment where Rosenbaum shares the story.

The frankly shocking allegations can be listened to in full, here. 

Other Notable Lines of Inquiry 

Because we are an ecommerce services provider with a large portion of our business and expertise focused on the Amazon marketplace, our review focused on key takeaways for brands and third-party sellers that operate on the Amazon marketplace. However, the committee’s questions delved into much more, including: 

  • Whether Amazon is seeking access to content rights for content available on HBO Max, Hulu, Disney+, or Netflix as part of its negotiations around Fire TV 
  • Whether Amazon’s initial and ongoing response to COVID-19 has been sufficient 
  • Allegations of wrongful terminations 
  • Amazon’s plans for the upcoming pilot commercial ecommerce program organized by the General Services Administration (GSA) (the program will essentially offer a marketplace specifically for federal employees) 

The Future of Amazon 

While Amazon is under fire from Congress for monopolizing the ecommerce space and stealing third-party data to usurp its customers, Amazon hasn’t broken its stride. Q3 is looking to be another strong quarter, with North American retail revenue forecasted to grow 30% year-over-year (YOY), compared to 21% YOY growth in Q3 2019. Likewise, Amazon’s advertising revenue is expected to grow 37% YOY in Q3, compared to 41% in the previous quarter.  

Predictions for the Amazon Marketplace, Near and Far 

  • Amazon will continue enhancing advertising services on and off its platform to further realize revenue from this rapidly growing segment. 
  • Amazon will continue expanding its brand protection services, including paid brand protection services, as pressure mounts from Congress and upcoming competitors, like Walmart and Target. 
  • Amazon will retain many of the inventory policies for its fulfillment centers that it put into place during the pandemic. Permitting only faster-turning products to be stored in Amazon fulfillment centers increases Amazon’s profits, and the baseline for consumer demand in ecommerce has been permanently raised as the result of COVID-19. As a result, Amazon can afford to impose stricter conditions. 
  • Amazon first-party sales share will continue to reduce, as Amazon enjoys better profits and less risk through seller fees and having third-party sellers carry inventory risk. Pointing to the shrinking share of first-party goods, even as total revenue grows, also helps Amazon argue against calls for trust busting. 
  • If other online marketplaces can rise to compete with Amazon, as Walmart has been making strides towards with the launch of Walmart Fulfillment Services and Walmart+, calls for trust busting may dissipate. As such, Amazon may limit competitive efforts to stymie their growth too much, so it can point to competition as antitrust pressure mounts.  
  • Though countries such as India have forbidden the marketplace owner from also being a seller, it is unlikely that the US will institute such a policy given that Amazon, Walmart, Target, and others all act as first-party sellers alongside third-party sellers on their marketplaces.  

Amazon and social media marketing

What is Social Media Marketing? 

Social media marketing is the act of promoting products and brands to consumers on social media platforms, such as Facebook, Instagram, Twitter, LinkedIn, Triller, TikTok, and Snapchat. In today’s virtual age, social media marketing is one of the most powerful marketing tools that brands have at a relatively low cost. 

When done in tandem with other marketing efforts, social media marketing can deliver extraordinary results. A great example of this is Häagen-Dazs’ Instagram and TikTok viral marketing campaign in the United Kingdom. In this campaign, Häagen-Dazs sponsored a weekly home-entertainment series, called “Secret Sofa,” which was promoted by influencers. They had numerous UK creators on TikTok and Instagram create videos around the sponsored series. From this campaign, Häagen-Dazs doubled its Amazon orders amid the COVID-19 pandemic.   

There are two types of social media marketing: organic and paid. 

Organic Social Media Marketing 

Organic social media marketing is any activity that doesn’t require a budget, such as posting, commenting, replying to messages, or interacting with other accounts. Organic marketing is all about growing brand awareness and engaging with your audience. Building relationships and earning customer trust is just as essential for brands online as for brick-and-mortar stores. It’s about striving to achieve the familiarity and service of a locally owned business, but on a much larger scale.

Learn about Kaspien’s organic social media marketing services.

Paid Social Media Marketing 

The second type, paid social media marketing, is about reaching your consumer through paid efforts on social media. These can include influencers, paid advertisements, sponsorships, and much more. Paid marketing is meant to drive traffic and sales on websites or online marketplaces. 

Learn about Kaspien’s paid social media marketing services.

click to enlarge

How to Use Social Media Marketing to Drive Amazon Sales 

Social media marketing can seem like a daunting undertaking for brands new to the space. It can be complicated, but there are a few principles to guide you.  

First off, engage with your audience. Use social platforms to create content, such as images and videos, that display your brand’s values and aesthetic. Do you want your brand to be seen as witty, earnest, fun, no-nonsense, etc.? You can reinforce your branding every time you engage with your audience with copy and visuals alike.  

Second, include a call to action. Suppose your goal is to sell a product, point shoppers to your products and listings. Not every post should include a CTA, as that risks coming across as overwhelming or making the relationship feel shallow. Balance CTAs with organic engagement.   

If you first engage and interact with your social network on the social platforms, directing them to your listing or website will be much easier. In many cases, shoppers need to connect with your brand long before they consider purchasing your products.  

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Promote Products Online: Amazon Marketing 

Amazon is the largest online marketplace and shoppers on Amazon have a higher intent to purchase than those searching via Google. The problem is that Amazon advertising is getting more expensive. In addition to growing brand awareness and building loyalty, social media marketing can help brands grow their Amazon sales. Reaching shoppers off Amazon and directing them back to Amazon allows you to bypass competitors’ Amazon ads. Plus, if they’ve interacted with your brand on social media in the past, you’ve already gained their trust on Amazon. 

Thanks to the Amazon Attribution Program, you can even attribute on-Amazon sales to off-Amazon promotions. If a consumer finds your products through your social media, and you’ve placed a trackable link created via the Amazon Attribution Programyou’ll gain insights such as clicks, Amazon listing views, and purchases. Amazon attribution is a necessary tool to gauge the effectiveness of your social media efforts. 

Run Amazon Giveaways via Social Media 

One great example of how to utilize social media marketing to drive Amazon sales is through product giveaways. Amazon used to run a program called Amazon Giveaways, but Amazon retired giveaways in October 2019. We saw great success in running product giveaways, so the loss of the program was disappointing (BUT, we did create a list of low-cost marketing alternatives to Amazon Giveaways). However, through social media marketing, you can still run giveaways manually through your social media channels. Our partners have seen excellent results promoting their Amazon listings through giveaways held on their social media channels, as it’s a natural way to drum up interest in your products on Amazon. 

More free resources

On September 8th, Amazon announced updates to its communications policyThe update clarifies what buyer-selling communication is permitted by Amazon’s policies, something that was previously ambiguous at best. The update is intended to reduce the number and improve the quality of emails Amazon shoppers receive in the interest of improving the Amazon buying experience. 

Biggest Takeaways: 

  • Sellers can ask buyers for product reviews and/or seller feedback (although you still cannot ask for a positive review, only an honest review) 
  • Amazon clarified what message types, content, and formatting are not permitted 
  • The policy update applies to all Amazon marketplaces 
  • The updated policies go into effect on November 3, 2020 

Communications Updates 

Permitted Buyer-Seller Communications 

Sellers are permitted to communicate with buyers for the following three reasons: 

  1. If an order cannot be shipped or if it will be delayed. This must be communicated via Seller Central using the Manage Orders feature. 
  2. If additional information is needed to complete a return or if the seller is offering a partial refund. This must be communicated via Seller Central using the Manage Orders feature. 
  3. Communicate with buyers proactively (communication initiated by the seller instead of the buyer) to: 
    1. Resolve an order fulfillment issue  
    2. Request additional information required to complete the order 
    3. Ask a return-related question 
    4. Send an invoice 
    5. Request product review and/or seller feedback 
    6. Schedule the delivery of a heavy or bulky item 
    7. Schedule a Home Services appointment 
    8. Verify a custom design 
    9. Any other reason where the contact is required for the buyer to receive their purchase 

 

Proactive messages may be sent using email, Amazon’s templates in Seller Central, third-party applications, or via API. These messages must be sent within 30 days of order completion, include the 17-digit order ID, and be in the buyer’s preferred language. Amazon retains the authority to modify subject lines as it deems necessary.  

Learn more about how customer reviews impact Amazon sales or how to generate new customer reviews compliantly. 

Forbidden Message Types 

Amazon’s policy update states that sellers may not send the following message types to buyers: 

  1. Order or shipping confirmations 
  2. Messages that say only “Thank you” or that you are here to help if buyers have any problems  
  3. Marketing or promotional messaging, including coupons  
  4. Language that either incentivizes or persuades the buyer to submit positive product reviews or seller feedback, including by offering compensation, money, gift cards, free or discounted products, refunds, rebates or reimbursements, or future benefits  
  5. Language that requests removal or an update of an existing product review  
  6. Language that requests a product review only if they have had a positive experience with the product 
  7. A repeat request (per order) for a product review or seller feedback 

 

Forbidden Message Features 

Seller-buyer communications must not contain any of the following: 

  1. External links unless they are secure working links (https, not http) necessary for order completion or links to Amazon  
  2. Attachments except for product instructions, warranty information, or invoices  
  3. Logos, if they contain or display a link to your website  
  4. Link to opt-out of messaging  
  5. Sensitive content in images or text (e.g. bare skin, violence/gore, adult/offensive language)  
  6. Tracking pixels or images  
  7. Email addresses or telephone numbers  
  8. Images of purchased products as Amazon includes those on your behalf  
  9. Images that do not relate to your brand or company 

 

Forbidden Message Styling 

Likewise, the policy update also forbids seller communications from containing any of the following: 

  1. Accessibility issues as specified in the Web Content Accessibility Guidelines from the Web Accessibility Initiative  
  2. Emojis  
  3. GIFs  
  4. Message margins over 20% max width  
  5. Image or graphic sizes larger than 80% max width  
  6. Overrides of Amazon’s default line height, font family, or font color  
  7. Fonts in more than three sizes  
  8. Message bodies that are centered or that otherwise override default text alignment settings  
  9. More than two line-breaks (spacing between paragraphs) in a row  
  10. Unsecure images (http instead of https)  
  11. Spelling errors or grammar issues 

 

Compliance Required by November 3, 2020 

Sellers that fail to comply with Amazon’s updated guidelines by November 3rd may face temporary restrictions in proactive seller-buyer communication or a suspension of their seller account. 

Amazon Giveaways Alternatives

Amazon Giveaways used to be an affordable and impactful way to increase traffic to Amazon listings and support sales growth. However, in October 2019, Amazon retired the Amazon Giveaways Program. We’ve noticed an uptick in searches for Amazon Giveaways as brands plan their holiday marketing strategy for Amazon.  

Amazon Marketing Services for the Holidays 

The holidays are a crazy time for the eCommerce world. In 2019, online holiday spending in the US totaled $142.5 billion. With the continuation of the COVID-19 pandemic, holiday spending is expected to rise on online marketplaces. Since Amazon Giveaways are no longer an option, we’ve put together a list of other cost-effective Amazon marketing services you can use to support Amazon’s sales growth this holiday season.   

Giveaways on Social Media Utilizing the Amazon Attribution Program 

Even without the Amazon Giveaways Program, you can still offer product giveaways. Instead of using Amazon’s program, you can offer giveaways through your brand’s social media channels. This tactic does require more work on your end, as you’re responsible for managing the giveaway from start to finish, but it’s a relatively low effort project and can be a great way to boost your visibility.   

Consider partnering with an influencer to expand the reach of your giveaway on social media. The influencer can post the giveaway on their social channels while you cross-promote on your social channels as well, amplifying your giveaway’s reach while introducing thousands of new potential customers to your brand. 

Thanks to the Amazon Attribution Program, you can track on-Amazon metrics, such as traffic, page views, and sales, generated from this off-Amazon giveaway. These tracking measures allow you to see the effectiveness of your giveaways on Amazon. 

Amazon Coupons 

Amazon Coupons display on the search engine results page (SERP), on the Amazon Coupons page, and the product listing. Coupons are a great way to boost sales, especially on products where the price is differentiating.  

Amazon Coupons

Brands can enroll up to 50 ASINs into a single coupon and offer a dollar amount or percentage off. The coupon cost to the advertiser will equal the discount + $0.60, both of which are subtracted from the coupon budget. Each coupon must have a minimum of $100 for the budget; however, brands will be charged only for redeemed coupons. Within Amazon Coupons, brands get to dictate the duration, the discount, and the product selection. This variety of options makes Amazon Coupons very customizable to your marketing needs.  

Amazon Live 

Back in 2019, Amazon revealed Amazon Live. Amazon Live allows sellers to use the app, Amazon Live Creator, to broadcast live streams where they demonstrate product usage, features, and benefits. Featured products appear directly below the live broadcast. While playing, the videos appear on the brand’s listings, Amazon store, and Amazon.com/Live. The service is currently only available to brand registered brands based in the United States.   

Amazon Live is free and a great way to promote product launches or familiarize viewers with product features. These live events are the best time to allow for frequently asked questions or questions and answers. 

Amazon Stores and A+ Content 

While not an active promotion, Amazon Stores and A+ Content are free tools for brands enrolled in Amazon Brand Registry

Amazon Stores are digital storefronts for brands on the Amazon marketplace. These branded stores allow you to list your entire catalog of products. A+ Content (previously Enhanced Brand Content) provides the opportunity to share more product information through stylized content and additional images.  

A laptop displaying an Amazon Store for brands and sellers

These services are a great way to help your consumer engage with your brand and your products. Creating Amazon Stores and A+ Content is a way to encourage customers to convert once they reach your listings. 

Amazon Marketing is Alive & Well 

Amazon Giveaways may be gone, but your options for cost-effective Amazon seller marketing tools are not. Amazon Coupons, giveaways on social media, Amazon Live, Amazon Stores, and A+ Content are fantastic alternatives to increase sales and conversions. There’s a rich combination of opportunities available that can deliver similar and even better results than Amazon Giveaways, especially when deployed in conjunction with one another. 

Learn more about the current Amazon marketing landscape in our whitepaper, The State of Amazon Marketing. 

Originally published in the Forbes Technology Council. Read the article here.

Despite its incredible growth and undeniable popularity with consumers, I’ve noticed that some brands are hesitant or even outright opposed to the idea of selling their products on Amazon. With major brands like Birkenstocks and Nike having pulled their products off Amazon, these brand owners have reason to feel even more justified in their feelings.

Truth be told, there are likely good reasons for Nike and Birkenstocks to have withdrawn from Amazon, but these brands are the exception to the norm (not to mention the fact that they already had established large and loyal followings before joining Amazon). However, in my experience as a general manager at Amazon and now CEO of a company that helps brands sell online, the overwhelming majority of brands I’ve worked with have seen tremendous benefits from expanding their brand onto Amazon.

So, today, I’m sharing a list of reasons your brand probably should begin selling on Amazon, even if you’re not over the moon about it.

1. If You Don’t, Someone Else Will

Let’s start with the risks of not taking your brand to Amazon. Amazon is an ungated marketplace, which means nearly anyone can create a seller account and begin selling products on the platform. Between retail arbitrage, counterfeits and unauthorized sellers acquiring inventory, your products are likely to end up on Amazon, even if you don’t take them there.

By taking your brand to Amazon yourself, you retain control of your brand’s representation on the largest online marketplace in the world. That’s power you don’t want to relinquish.

2. Shoppers Are Already On Amazon

After that first point, it may feel like you’re being held hostage by Amazon’s ubiquity. To a degree, you are. But Amazon is so much more than that, and it would be a disservice to your brand to not recognize the enormous opportunity Amazon represents.

Now more than ever, consumers are using online marketplaces to purchase essential and discretionary goods. By the end of 2019, Amazon had over 112 million Prime members in the U.S.and over 150 million Prime members globally. By selling on Amazon, you tap into a massive and growing audience, increasing revenue and expanding your customer base.

3. Amazon Is Expected To Remain The E-Commerce Market Share Leader

That growth is expected to continue in 2020, even with the current pandemic. Although Walmart is making strong efforts to capture ecommerce market share, Amazon is indisputably the dominant market share leader. Even during this pandemic, Amazon is expected to not only retain its market share, but actually grow it by another 1%. If you want to expand your brand online, Amazon is the place to do it, and that’s unlikely to change any time soon.

4. Amazon Is Improving Brand Protection Services

Perhaps you’ve resisted selling on Amazon because you’re concerned about retaining brand control after joining the platform. Amazon has earned a reputation for not penalizing unauthorized sellers in the past, but that’s been gradually changing. In recent years, Amazon has introduced several programs designed to help brand owners and their registered agents maintain control, including Brand Registry, Brand Gating, the Transparency Program and Project Zero.

Amazon is also facing increased external pressure to address the issue of counterfeiters on its platform. The department of Homeland Security released a counterfeit report that advised the government to take action against counterfeits appearing on e-commerce platforms that threaten the health and safety of consumers and harm the economy. This report contributed to the progress of the SHOP SAFE Act, which, if passed, could hold online marketplaces responsible for counterfeits sold on its platform.

In short, Amazon is and will continue to improve services for brand control as external pressure mounts.

5. Diversification Makes You Resilient

If all of the above failed to convince you, then consider this final point: eMarketer recently revised its forecast for retail and e-commerce growth in 2020, with consumer spend in e-commerce expected to grow 18%, while spend in brick-and-mortar stores is expected to decrease 14%. The revised forecast indicates that Covid-19 has accelerated the long-anticipated uptick in e-commerce spending as more consumers turn to online shopping.

The change in consumer spend patterns also means that brands that sell in both brick-and-mortar stores and online have been better positioned to weather the economic hardship. Diversification of assets is a tried-and-true means to protect investments, and retail is no different. Expanding to other sales channels can help brands endure unexpected headwinds. Even if you don’t want to list your entire catalog on Amazon at the start, establishing at least some small foothold on the marketplace will keep the door open, should you ever need it in an emergency.

The Benefits Of Starting Late

While in many ways starting earlier is more advantageous, joining Amazon for the first time at this stage does have some benefits. Amazon offers more and better marketing and brand protection tools than ever before, and you have more ways to launch on the channel (1P, 3P, direct to consumer or with an agency). Even now, Amazon is still growing. There’s a lot of competition, but the opportunity for growth remains as high as ever.

 

On August 4th, Amazon published a press release announcing the impending launch of Amazon Sweden. On August 11th, Amazon sent an email to sellers with more details about what to expect with the new marketplace.  

In this email to sellers, Amazon stated that Amazon Sweden will be available within EU Seller Central accounts as Seller Central Sweden. All Professional Selling fees and referrals fees will stay the same with this expansion.  

The email also outlined how products currently in Amazon’s European Seller Central will synchronize to Seller Central Sweden. Amazon has created the Build International Listings (BIL) tool to automate and accelerate this process. If a seller does not wish to have his or her listings synchronized, they must override it manually. Amazon notes that products subject to the Swedish Chemical Tax will be excluded. 

It is uncertain when Amazon Sweden will launch. In January of this year, Amazon sent a similar announcement for Amazon Netherlands, which was publicly launched in March. If Amazon maintains a similar timeline for Sweden, we could see the marketplace publicly launch in October, though an official date has not yet been released. In the meantime, Amazon asks sellers to go into their EU Seller Central account and check to ensure all of their product listings are synchronized accurately. 

If you’re interested in expanding your brand to Sweden, we can provide a full suite of Amazon services for marketing, brand protection, logistics, and more. 

Amazon’s Email Announcement to Sellers 

“Dear Selling Partner, 
 
We are pleased to announce that we have started the work to launch the Swedish Amazon.se Store, to delight local customers and give Selling Partners the opportunity to expand their European business even further.

Seller Central Sweden will soon be available to you as a seventh country option in your EU Seller account. With the same monthly Professional Selling fees and referral fees, you can access all seven European Amazon Stores.

To support you with the expansion of your business, we will synchronize your eligible product selection with your Seller Central account for Amazon.se. You will be notified via email once Seller Central Sweden is available and the synchronization is complete. You can then revise your synchronized selection.

How will we synchronize the existing product selection: 

  • We will enable the Build International Listings (BIL) tool in Seller Central, which allows us to list your eligible existing products from your Home Marketplace on Amazon.se on your behalf, to save you valuable time. You can edit the BIL connection between the Seller Central accounts of your choice afterwards at any time here by clicking “remove connection”. 
  • Please note: When the BIL tool is active, it will regularly synchronize your existing listings and prices for all linked Seller Central accounts. Please check your preferred tool settings here after the synchronization is complete.  
  • The product descriptions will automatically be translated to Swedish, using BIL’s Machine Translation functionality. 

Learn more about BIL and its functionalities here 

What product selection will be synchronized? 

  • We will synchronize your eligible selection which is currently exportable to Sweden and prices that are active on Amazon.co.uk and Amazon.de. For your self-fulfilled listings, we will synchronize your prices from your BIL source marketplace, adjusted for exchange rate* to Swedish Krona. 
  • For your Fulfilment by Amazon (FBA) Pan-European FBA (Pan-EU) listings, we will take into account:  
  • VAT differences between BIL source marketplace and Sweden. Example: If you are selling a product on Amazon.de for 10.00€, we will synchronize the product price on Amazon.se as SEK 114.5, taking the VAT differences in Germany (16%) and Sweden (25%) into account. 
  • Fulfilment fee differences between your BIL source marketplace and Sweden. 
  • You will be able to benefit from the Fulfilment by Amazon (FBA) and Pan-European FBA (Pan-EU) programs with domestic fees and offer your products to local customers. You can find the promotional fees that are valid until June 31st, 2021 here. 
     
    *The BIL tool adjusts prices periodically to reflect currency conversion fluctuations in the target marketplaces’ currencies. The frequency of these updates might vary from daily to weekly. These updates will not show changes of less than 1%.

Please note: If you are selling Consumer Electronics, we will not synchronize products that will become subject to the Swedish Chemical Tax that is expected to become effective in Sweden from 1st of October, 2020. We will provide you with more information in the upcoming weeks. Please reach out to your tax adviser for additional information.

What you need to do: 

  • In the next few weeks, we will notify you via email once the product synchronization is complete. Check here under Account Notifications, if your email address for important Technical Notifications and Business Updates is still up to date. 
  • Check your synchronized listings and prices under Manage Inventory in Seller Central.  
  • If you are already using the Build International Listings (BIL) tool, you can edit the connection between the Amazon Stores of your choice and prevent product listings from synchronizing here at any time. If you wish to opt-out from selling on Amazon.se, click here to “remove connection”. 
  • If you are not using the BIL tool yet, we will activate it on your behalf to synchronize your selection to Amazon.se. You can edit and remove the BIL connection here afterwards. 
  • Once Amazon.se launches, your listings will become available to our local customers from the start of the new Amazon Store.”

Walmart Fulfillment Services vs Amazon FBA

In the world of ecommerce, FBA (Fulfilled by Amazon) is one of the most used phrases. Now, get ready to use WFS (Walmart Fulfillment Services) just as frequently. Walmart Fulfillment Services launched in February 2020, putting Walmart in better position to compete with Amazon. Walmart Fulfillment Services is a fulfillment network owned and operated by Walmart. It allows brands who sell on Walmart to ship inventory directly to Walmart’s fulfillment centers for storage and order fulfillment for goods purchased on Walmart.com. 

Before Walmart Fulfillment Services, brands who sold on Walmart.com had to fulfill orders through a dropship model or through a third-party logistics (3PL) provider. The dropship model placed all order fulfillment and customer service responsibilities onto sellers, and the 3PL model could be cost-prohibitive for certain items 

This fulfillment situation made selling on Walmart difficult for some sellers and brands. Walmart Fulfillment Services improves the selling experience for Walmart’s Marketplace by providing sellers a solution for storage, 2-day fulfillment, customer service, and return management, all competitive with Amazon’s FBA capabilities. 

Download our Walmart Fulfillment Services vs. Fulfilled by Amazon eBook 

The Advantages of Using Walmart Fulfillment Services 

The Walmart Marketplace is quickly growing, and now is the time for brands to position their products on the marketplace. Marketplace Pulse reported that in June 2020, over 3,500 sellers joined the Walmart Marketplace, bringing the total number of sellers to 48,332, with most being dropship sellers.  

Fast Shipping & Greater Buy Box Share 

Amazon’s FBA program set the bar exceptionally high for online shopping convenience, and consumers now expect fast shipping for their online purchases. According to Walmart, consumers are less likely to convert on offers with a 5day shipping window, whereas items with a 2-day offer can see a 30% conversion lift. Brands and sellers who can offer nationwide 2-day shipping on their products can enroll in Walmart’s TwoDay Program, resulting in improved searchability and Buy Box percentage 

Logistically, fulfilling nationwide orders in 2-days can be challenging for sellers and brands. Such capabilities require a vast infrastructure – an infrastructure that Walmart already has thanks to its thousands of physical store locations across the US.  

Items fulfilled through Walmart Fulfillment Services are guaranteed nationwide 2-day shipping. On top of that, products in Walmart Fulfillment Services also capture a larger share of the Buy Box over all other offers, including non-WFS 2-day offers. Products sold through Walmart Fulfillment Services will display “fulfilled by Walmart” on the products, which Walmart hopes will increase consumer trust in product authenticity. 

Walmart Marketplace Listing

During the onset of the coronavirus pandemic in the US, Amazon’s fulfillment network struggled under the strain, and they were unable to maintain 2-day shipping. Walmart, on the other hand, was. Products fulfilled through Walmart Fulfillment Services maintained the 2-day shipping guarantee throughout the pandemic. While Walmart handles far less volume than Amazon currently, the difference is a promising indicator that Walmart is building a robust infrastructure. 

Affordable Storage Fees 

Walmart Fulfillment Services offers consistent storage fees that are comparable to FBA, with monthly storage fees starting at $3.45/unit. Walmart also states there are no long-term storage (LTS) fees, a stark contrast with Amazon’s FBAHowever, if inventory stagnates in Walmart Fulfillment Service, it seems likely that Walmart would implement LTS fees to incentive liquidation and better inventory forecasting.  

This simple fee structure help sellers forecast the profitability of each shipment going into the Walmart Fulfillment Service network. Amazon’s storage fees are more complex, with monthly storage fees increasing in Q4 and LTS being applied monthly to items that have been housed for over a year. For most of the year, Amazon’s monthly storage fees are $0.48-.75 per cubic foot (depending on size) and from October to December, these fees increase to $1.20-$2.40 per cubic foot. 

Another notable difference between Walmart Fulfillment Services and FBA is that, for the moment, brands only have to ship to one Walmart fulfillment center. The single ship-to location provides a much simpler process for brands than Amazon FBA, which requires brands to ship inventory to multiple fulfillment centers. This situation will likely change in the future as Walmart’s online operations continue to expand, but for the time being, it’s a pleasant perk of Walmart’s system. 

Key Differences Between WFS and FBA 

We’ve mentioned differences in pricing models and ship-to locations, but how else does Walmart Fulfillment Services differ from FBA?  

Read about Walmart’s new subscription service that will rival Amazon Prime, Walmart Plus. 

Reporting 

While FBA does offer deeper reporting to sellers and the extra service of fulfilling orders for select websites off Amazon, Walmart is quickly enhancing their reporting. Walmart has made impressive improvements to their reporting over the last three months, including working closely with their approved sellers on creating dashboards. These dashboards will help sellers understand product performance, as well as identify which products not yet sold on Walmart have the highest opportunity to perform well on the platform 

Product Preparation 

Unlike Amazon’s Seller Central, Walmart’s Seller Portal currently does not offer the ability to create box labels or shipping labels required for shipping to Walmart’s fulfillment centerAs a result, prepping shipments can be a manual process.  

Product Requirements for Walmart Fulfillment Services 

Walmart Fulfillment Services’ product requirements are a bit stricter than FBA requirements. Learning from some of Amazon’s missteps, Walmart is working hard to prevent counterfeit items from polluting its platform and keep warehousing to a minimum. Below are a few Walmart Fulfillment Services product requirements and how they differ from FBA. 

  • WFS – Products must ship to Walmart fulfillment centers from within the United States. 
    FBA – Amazon FBA centers will accept international shipments if the correct labeling if applied, including box labels and pallet labels if shipping LTL. 
  • WFS – Country of Origin must be on the retail packaging.  
    FBA – This is not required at FBA.   
  • WFS – Products must have UPCs on the product packaging. 
    FBA – Amazon’s ASIN labels can be printed and applied to products when needed. WFS does not offer labeling options or services.  
  • WFS – Maximum product weight is 30 lbs 
    FBA – Will accept shipping cases up to 50 lbs., along with single products weighing over 150 lbs. (with additional fees applied). 
  • WFS – Maximum product dimensions: 25″ x 20″ x 14″. 
    FBA – Dimensions up to 25” on any sideFBA also accepts oversized single items that are over 108” on its longest side and over 165” in length + girth.  

Sell on Walmart.com 

Selling on Amazon has taught brands the importance of keeping channel control. If brands do not sell their products on a marketplace, someone else will, and unfortunately, rogue sellers are not known for providing the best representation for brands.  

Walmart is growing quickly, which means that now is the time to position your brand on the platform before someone else does. The Walmart Marketplace is the second largest marketplace in the US, with over 400 million website visits per month. In the second quarter of 2020, Walmart reported that their ecommerce sales grew 97%. By being an early adopter, brands can position themselves in front of a larger audience and ahead of competitors.  

Accessing Walmart Fulfillment Services 

Walmart Fulfillment Services is currently open only to select sellers, and so far, the number of sellers approved to sell is low. Walmart wants to limit the risk of counterfeit sellers entering the marketplace, which is easier to do with a smaller number of trusted sellers. As such, it is unclear if Walmart will move to a less strict approval process for Walmart Fulfillment Services 

We were among the first group of sellers personally invited to sell Walmart.com in 2016, and we are an approved WFS seller. We’ve had an excellent experience with the program. Our account manager is easy to contact, and the Walmart team has provided reporting to help grow our product selection. By partnering with Kaspien for Walmart, brands can draw from our Amazon expertise and leverage our proven marketing strategies and software services to help their brand grow on the Walmart Marketplace.