eCommerce Essential Guide to Compete and Beat Amazon
As an e-tailer, you are likely swimming with a shark. Amazon is huge and getting bigger all the time. Sure, when I say ‘Amazon’, I partly mean any given ‘big box brand‘ ecommerce store like Tesco, Walmart or Toys R Us. But considering Amazon’s tendency to either eat or kill smaller fish, its exponential growth rate and it’s vast near infinite amount of inventory – it’s also the number one competitor for almost any consumer-ecommerce business.
So how do you cope? As an ecommerce entrepreneur, how do you compete with a company that has already proven it will take a loss to undercut you, like it did with Diapers.com? When Pawel Grabowski talked to ecommerceinsider.com last year about this problem, he summed up what smaller ecommerce players are facing. ‘I have no influence on my shipping rates and can’t offer free shipping on everything; I can’t negotiate prices lower than MRSP (minimum recommended sales price);I don’t have a massive budget for marketing – nor a team of people working hard to make my site more user friendly; I can’t open my own dedicated distribution channel.’
So if you can’t do all that, what can you do?
1: You can focus.
Amazon, like all other giant stores, online or not, is primarily focussed on growth. It might be able to sell itself as the best place to get anything, but it’s never going to be the best place to get something specific; luremycarp.com will have better fishing lures, discoinferno.com will have a better selection of sparkly flares. If you sell to a niche, focus in. Brand yourself as an expert in your field through social media, blogging and other methods; make the products in your ecommerce store part of the overall experience of seeking knowledge and solutions from you, the expert who shares the customer’s passion for and involvement in your niche.
2: You can ‘Amazon the small stuff.’
Amazon has everything – but it doesn’t have every size and colour of everything. If you’re a customer looking for something specific, Amazon will probably have only a few examples with relatively restricted size, colour and styling options. By comparison, you can offer your range in a vast array of styling and size options. You can also offer features that Amazon doesn’t – just because you don’t have a big team working on your storefront and data doesn’t mean you can’t offer free downloads, alternative formats for purchasable files, and a level of engagement a big store can never match.
3: You can make a great browsing experience.
Amazon is basically a search engine for merchandise, and because of its size it tends to offer pretty impersonal recommendations based solely on algorithms. It’s functional at best – one result of which is ‘show-rooming,’ where customers in offline shops use the shop as a showroom, then buy the product on Amazon. That points up the weakness in traditional retail, a weakness for which the sector is paying heavily even as we speak. But it points up a weakness in Amazon too: it’s no fun. In fact it’s so little fun that as many as half of all carts on Amazon are abandoned. You might not be able to compete with Amazon’s global reach or rock-bottom prices, but you can create a browsing experience that’s immersive, pleasurable, rewarding – and hang on to a higher percentage of your customers.
4: You can engage.
Blog, use social media, and reach out and form a community with your customers. Being a relatively small outfit with a tight focus is actually an advantage here: customers who share your interest or whose needs you meet can feel a sense of fellowship with your brand. No-one thinks Amazon is their friend. The now-familiar methods of creating, impressing, engaging and retaining a community around your business offers you credibility, a ready reception for event and offer ads, and a way for customers to advertise your business to their friends.
5: You can sell to the customer, not from the store.
Amazon doesn’t really do this at all. Amazon’s ideal customer is someone who wants to buy something. That’s as specific as it gets. But you can build a detailed picture of who your top performing customers are and dedicate time and energy to recruiting more like them. Unlike the big-box model which Amazon has put online, digitized but otherwise basically unchanged, think of a tailor’s, a boutique or an old-fashioned hobby shop. Personal attention and care for the customer ensures higher-value customers tell their friends, return and treat your business like it matters to them. Online equivalents might include live chat, customer reviews and a forum on your site, as well as blogging and social media. The more involved customers are the better; increased engagement from your very best customers allows you to tailor what you say to them, offering them the deals, offers, products and online content they tell you they want, something that will simply never happen with a one-size-fits-all outfit, online or not.
6: Get smart about SEO and search.
That can mean getting good at content marketing, but it can also mean quality product descriptions, product photos as well as investing in PPC and PLA ads. Remember, for Amazon, search isn’t a problem; whatever product you Google, all roads lead to Amazon. But smaller companies can dominate smaller fields. Figure out exactly the territory you want to rule, remembering that if you have a narrow focus that can be a positive advantage. ‘Shirts’ might not find you, but if you only sold pin collar shirts, ‘pin collar shirts’ is all the search you need to rank in.
While a smaller operator can never hope to compete directly on the things Amazon is really good at, big box stores like Amazon aren’t scoring perfectly in all areas. They have their priorities and they’re leaving quite a lot on the table, so there are areas where a smaller brand can score over them convincingly.
I’ll leave you to watch this video for inspiration and would love to hear you thoughts about competing against Amazon by leaving a comment below.
About the author: Kunle Campbell
An ecommerce advisor to ambitious, agile online retailers and funded ecommerce startups seeking exponentially sales growth through scalable customer acquisition, retention, conversion optimisation, product/market fit optimisation and customer referrals.
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eCommerce Essential Guide to Compete and Beat Amazon
As an e-tailer, you are likely swimming with a shark. Amazon is huge and getting bigger all the time. Sure, when I say ‘Amazon’, I partly mean any given ‘big box brand‘ ecommerce store like Tesco, Walmart or Toys R Us. But considering Amazon’s tendency to either eat or kill smaller fish, its exponential growth rate and it’s vast near infinite amount of inventory – it’s also the number one competitor for almost any consumer-ecommerce business.
So how do you cope? As an ecommerce entrepreneur, how do you compete with a company that has already proven it will take a loss to undercut you, like it did with Diapers.com? When Pawel Grabowski talked to ecommerceinsider.com last year about this problem, he summed up what smaller ecommerce players are facing. ‘I have no influence on my shipping rates and can’t offer free shipping on everything; I can’t negotiate prices lower than MRSP (minimum recommended sales price);I don’t have a massive budget for marketing – nor a team of people working hard to make my site more user friendly; I can’t open my own dedicated distribution channel.’
So if you can’t do all that, what can you do?
1: You can focus.
Amazon, like all other giant stores, online or not, is primarily focussed on growth. It might be able to sell itself as the best place to get anything, but it’s never going to be the best place to get something specific; luremycarp.com will have better fishing lures, discoinferno.com will have a better selection of sparkly flares. If you sell to a niche, focus in. Brand yourself as an expert in your field through social media, blogging and other methods; make the products in your ecommerce store part of the overall experience of seeking knowledge and solutions from you, the expert who shares the customer’s passion for and involvement in your niche.
2: You can ‘Amazon the small stuff.’
Amazon has everything – but it doesn’t have every size and colour of everything. If you’re a customer looking for something specific, Amazon will probably have only a few examples with relatively restricted size, colour and styling options. By comparison, you can offer your range in a vast array of styling and size options. You can also offer features that Amazon doesn’t – just because you don’t have a big team working on your storefront and data doesn’t mean you can’t offer free downloads, alternative formats for purchasable files, and a level of engagement a big store can never match.
3: You can make a great browsing experience.
Amazon is basically a search engine for merchandise, and because of its size it tends to offer pretty impersonal recommendations based solely on algorithms. It’s functional at best – one result of which is ‘show-rooming,’ where customers in offline shops use the shop as a showroom, then buy the product on Amazon. That points up the weakness in traditional retail, a weakness for which the sector is paying heavily even as we speak. But it points up a weakness in Amazon too: it’s no fun. In fact it’s so little fun that as many as half of all carts on Amazon are abandoned. You might not be able to compete with Amazon’s global reach or rock-bottom prices, but you can create a browsing experience that’s immersive, pleasurable, rewarding – and hang on to a higher percentage of your customers.
4: You can engage.
Blog, use social media, and reach out and form a community with your customers. Being a relatively small outfit with a tight focus is actually an advantage here: customers who share your interest or whose needs you meet can feel a sense of fellowship with your brand. No-one thinks Amazon is their friend. The now-familiar methods of creating, impressing, engaging and retaining a community around your business offers you credibility, a ready reception for event and offer ads, and a way for customers to advertise your business to their friends.
5: You can sell to the customer, not from the store.
Amazon doesn’t really do this at all. Amazon’s ideal customer is someone who wants to buy something. That’s as specific as it gets. But you can build a detailed picture of who your top performing customers are and dedicate time and energy to recruiting more like them. Unlike the big-box model which Amazon has put online, digitized but otherwise basically unchanged, think of a tailor’s, a boutique or an old-fashioned hobby shop. Personal attention and care for the customer ensures higher-value customers tell their friends, return and treat your business like it matters to them. Online equivalents might include live chat, customer reviews and a forum on your site, as well as blogging and social media. The more involved customers are the better; increased engagement from your very best customers allows you to tailor what you say to them, offering them the deals, offers, products and online content they tell you they want, something that will simply never happen with a one-size-fits-all outfit, online or not.
6: Get smart about SEO and search.
That can mean getting good at content marketing, but it can also mean quality product descriptions, product photos as well as investing in PPC and PLA ads. Remember, for Amazon, search isn’t a problem; whatever product you Google, all roads lead to Amazon. But smaller companies can dominate smaller fields. Figure out exactly the territory you want to rule, remembering that if you have a narrow focus that can be a positive advantage. ‘Shirts’ might not find you, but if you only sold pin collar shirts, ‘pin collar shirts’ is all the search you need to rank in.
While a smaller operator can never hope to compete directly on the things Amazon is really good at, big box stores like Amazon aren’t scoring perfectly in all areas. They have their priorities and they’re leaving quite a lot on the table, so there are areas where a smaller brand can score over them convincingly.
I’ll leave you to watch this video for inspiration and would love to hear you thoughts about competing against Amazon by leaving a comment below.
About the author: Kunle Campbell
An ecommerce advisor to ambitious, agile online retailers and funded ecommerce startups seeking exponentially sales growth through scalable customer acquisition, retention, conversion optimisation, product/market fit optimisation and customer referrals.