Chief Executive Officer
From customer loyalty to advertising opportunities and so much more, here’s why selling on Amazon is still the best way forward in 2023.
Considering the changes with Amazon.com and the world of e-commerce in general over the past few years, do you still want to put all of your eggs in one basket? If you’ve been wondering if continuing with Amazon is still the right move for your business, your concerns are definitely valid. No business owner wants to spread themselves too thin, so it's only logical that you want to expand your business and find the right platform for a driven FBA seller such as yourself.
In this post, we make the case that when it comes to growing your FBA business, it’s (still) a good idea to invest in Amazon versus other marketplaces.
Let's get back to basics for a minute. If you want to continue (or even start to build) your seller success in 2023, we recommend taking some much-needed time to assess where you are with your business goals.
If you're an established seller on Amazon in 2022, you should be using the platform for a few (or all) of the following reasons:
So when reviewing your FBA business goals for the upcoming year, ask yourself this question: What opportunities does Amazon provide for me so I can succeed?
To help you, our experts at Mayan break down the potential that’s available to sellers on Amazon compared to other online marketplaces. We’ll outline everything relevant to FBA sellers like:
At this point in time, it would be pretty hard to find someone who hasn't heard of Amazon.com, the online marketplace where you can buy just about anything under the sun. From fidget spinners to pet spray and other top selling products, you can find it on Amazon.com.
Since the company's inception in 1994 as an online marketplace for books, it's grown to be one of the biggest companies in the world by market cap. In 2022, the e-commerce giant's total revenue was $469.8 billion.
When looking at the top 5 online marketplaces in the U.S, the numbers don’t even compete.
The latest statistics reveal that Amazon comes in at 37.9% for market share, with Walmart and Ebay at 5.8% and 4.5%. On top of that, practically half of all eCommerce sales in the U.S. happen on Amazon. All of the other marketplaces fit into the other 50%.
Amazon.com also brought in an average of $2.8 million in daily sales, selling an average of 4000 items per minute. How many of those items could be yours?
All of these numbers may have you wondering: Sure, things are great for the company as a whole, but what about the little guy, the marketplace sellers? The latest data has also revealed that Amazon sellers raked in a total of $3.4 billion in earnings from May 2019 to May 2020. And while most of us were making our purchases online in 2020, Amazon.com drew in approximately 3.676 billion visits each month. Coming in second place during this time was eBay, with just over 1 billion customers per month. Basically, Amazon outpaced its closest competitor by 4.
Being the largest online marketplace in 2022 means that the sales opportunities for FBA sellers are much higher with Amazon compared to other platforms big or small. Just take it from the CEO of Viahart. A long-time FBA seller, Amazon still accounts for 90.8% of his company's sales, according to the latest seller data from 2021. His blog post titled Being An Amazon Seller in 2021: Year in Review, breaks it all down.
Although the company's products are sold on a variety of marketplaces, Viahart's sales on Amazon continue to outperform all of the others. Even when Amazon had its infamous supply-chain issues during the pandemic, Viahart’s sales numbers show that when some customers briefly shifted to shopping on Walmart.com, they came right back once the issues were rectified in 2021.
To sum up, Amazon's consumer base is colossal, and putting your products on the Amazon marketplace gives you access to this base and all of its loyal customers.
How do the other marketplaces measure up to Amazon's seller platform? We go over the main pros and cons of choosing to expand your FBA business on Amazon.
On Amazon.com, the customers are there. They've been there since 1996. So after launching your first Amazon store and you're able to reach some of those customers, it might feel like you've hit the jackpot. The trick is however to sustain that success. This is why we at Mayan believe in still selling on Amazon in 2022 and beyond.
When you're operating a business in the dominant marketplace, part of the FBA seller's job is to get their right customers to their store. From experience, one of the best ways to do that is by perfecting your Amazon PPC ad strategy. Which brings us to the next point.
Attracting those customers to your brand can be much harder if the customers just aren't there. This means that you will be spending a ton of ad ($) money on Facebook and Google trying to attract customers to your website, eBay store, Shopify, etc. Amazon wins by far when it comes to having the attention of consumers across the country.
With all the focus on Amazon, building a solid ad strategy can result in big wins for your business that you simply won't find elsewhere.
With the ‘Buy Now’ box, Amazon gives FBA sellers a chance to really up their sales by having one of their product listings be a Featured Offer on the marketplace. By maintaining your inventory levels, pricing your products competitively, and keeping your page optimized, you can up your chances of winning the coveted Buy Box where you’ll see your sales rise exponentially.
Being a successful FBA seller means that you can use Amazon to expand your business and brand. With all the monetary and visibility potential, use Amazon as a place to grow; manage your profits to invest in new ventures, expand the one you already have, and build up your brand name.
As many of you already know, bringing your business to Amazon doesn't mean instant wins. Here are some of the cons that FBA sellers come across on Amazon.
As an FBA business, monthly seller fees are a part of your reality. From your basic monthly plan fee, referral fees, fulfillment fees and storage fees, there's always a cut that Amazon takes from sellers.
If Amazon manufactures a similar product to you, know that their product will always outrank you in search. In addition, the price will be better and almost impossible for you to compete with, unless Amazon suddenly runs out of stock.
FBA warehouse fees are inevitable if you're a seller, but what happens when Amazon suddenly switches things up on you? The company is known to change its policies and FBA sellers have no choice but to follow. As Molson Hart points out in his blog post, his inventory costs went way up when Amazon decided to reroute his shipments from his nearby warehouse in Dallas all the way to Charlotte, North Carolina.
Now is the time to thrive. As an FBA entrepreneur, you need a strategy that aligns with your business goals so that you can make it happen. Check these top tips off of your Amazon to-do list and you'll be on your way to success.
Following the notorious supply chain issues of 2020, countless FBA sellers are re-thinking their inventory management strategy. Instead of relying on items to come in from the other side of the Pacific, U.S.-based sellers are looking south towards Latin America to expand their business. You can check this webinar we did on expanding your eCommerce business for more tips.
At Mayan, our expertise is Amazon advertising optimization. Our growth automation platform is there for Amazon FBA sellers who are looking to increase sales but find that ad work on Amazon is not only complicated but time consuming. We are a team of MIT-led data scientists and we've developed this tool to succeed on Amazon ourselves and want to help others make ad optimization less complicated.
Mayan's personalized tool uses analytics and reporting to build a winning, personalized ad strategy that's unique to your business on Amazon. If you're curious, you can find out more on our Product Page.
And then optimize again.
Product listing optimization is an ongoing process if you want to keep up with your competition. From adding value with images and videos to the importance of creating an emotional connection with your customers, this recent blog post breaks down the best ways to optimize your Amazon product listings for quick conversion rates.
So if you're thinking of putting some of your business budget to build on another platform, think again. When it comes to online marketplaces, Amazon wins by far when it comes to infrastructure, the high daily volume of traffic with a strong intention to purchase, as well as a solid advertising platform that performs.