B.J. Cook, CEO and co-founder, Digital Operative
In the 1930s, an engineer named Allen F. Morgenstern created a work simplification program so that workers could produce more with less effort. In the process, Morgenstern was credited with coining the phrase, “work smarter, not harder.”
Growing a direct-to-consumer (DTC) channel, while leveraging Amazon to do so, epitomizes Morgenstern’s famous quote. In order to grow your consumer-facing brand you need to be where the consumers are. According to eMarketer, Amazon was projected to capture 49.1 percent of all U.S. online sales by the close of 2018. Like it or not, the consumer is on Amazon.
By considering Amazon a competitor, companies run the risk of ignoring consumer preferences on where and when they shop. However, brands seeking to expand their market share also cannot simply relinquish control over their customer experience. As you know, brands need to establish relationships with their customers to earn loyalty and repeat business or risk becoming just one in a long line of nameless products on Amazon.
Conversely, Amazon has developed a reputation—well-earned, some would say—as the antithesis of the DTC model. The company’s refusal to share detailed customer data while offering only general consumer insights, its lack of market nuance in certain niches and its sometimes omnipotent, corporate customer service response model is seen as detracting from DTC brands. In fact, some DTC brands refuse to sell on Amazon because they feel much of the above serves to drive an actual wedge between themselves and the consumers that are so critical to the survival of their brands.
So, how does a brand balance the goal of nurturing its DTC channel without abdicating to Amazon its control of the customer experience? By being smart about leveraging one to grow the other.
Best of Both Worlds
In the DTC world, you own the customer relationship. You have first-party data that helps ensure you reach your customers with targeted messaging to personalize their experience. You can also build equity with your customers through your DTC site by controlling how you share your brand story and engage your customers with incentives and loyalty programs.
Meanwhile, on Amazon, shoppers are much further along in the sales funnel from the moment they sign on. With access to more than 300,000 small and mid-sized businesses selling on Amazon as of 2018, these consumers are merely the push of a button away from a product purchase. Not to mention that 54 percent of all product searches start on Amazon.
This type of dynamic can help you work smarter and not harder; you can work both sides and test every option to see what works. Here are four strategies to help you do that:
1. Make an Introduction
Establish an Amazon store to introduce your brand to the vast majority of consumers who use the marketplace. Doing so will provide you with additional visual and marketing tools on the platform. Identify SKUs you think might do better on Amazon than your DTC website. Perhaps listing some of your lower-priced or more entry-level SKUs via Amazon would help introduce your brand to that platform’s mass consumer audience, while directing that audience back to your DTC website for a broader selection of products. This can turn Amazon into a lead-generation tool for your brand.
2. Establish a Connection
For those consumers who click through from Amazon to experience your other offerings, you can leverage your control when they land on your DTC website by offering automatic points or rewards for signing up for your brand loyalty program. Your loyalty program can also offer limited run promotions or bonus points as an incentive to encourage consumers to return to your DTC website.
You can also create guided experiences on your DTC website to educate and inform consumers about your brand, product or corporate mission to win them over as brand ambassadors as well as loyal customers.
3. Test the Boundaries
A/B test a variety of product photos, graphics and video in each environment and analyze which supports higher conversion rates. If consumers like what they see of your brand on Amazon, be sure to carry that visual experience over to your DTC website and vice versa.
Testing what products work best on which platform is another smart move. Select product releases like overstock or liquidation sales can be a great introduction to your brand through Amazon. Support these special offerings with sponsored product or headline search ads offered by Amazon.
Combining what you have learned through Amazon and Google paid search queries, optimize your Amazon ads, Google Search ads, SEO and content efforts.
Another in a line of growing possibilities for DTC brands considering a presence on Amazon that tests its boundaries are direct deals. Certain successful DTC brands have reported that to attract those brands—and their customers—Amazon has explored everything from substantial, free Amazon advertising deals to allowing certain DTC brands to use their own branded packaging when selling through Amazon, a huge concession to be certain. The fact is, Amazon is looking for DTC brands as much as DTC brands want access to Amazon’s audience.
4. Stick with Your Customers
Once you’ve figured out what works in terms of sales and potential consumer leads through Amazon, don’t fall into the mistaken belief that you can only be successful on one platform and not the other. Remember, success is found where your customers are.
Given the volume of product searches that occur on Amazon, it’s likely the platform will win the keyword search fight with your own DTC website. Don’t consider this a negative. Rather, look at it as an opportunity to refine your product listings on Amazon to continue to draw customers to your Amazon store, and ultimately through to your DTC website.
If you tell your brand story well, proactively manage the conversion of consumers from Amazon to your DTC website and create a compelling and positive customer experience, you’ll soon find Amazon to be potentially one of the most productive marketing tools supporting your brand.
By creating and following a smart DTC strategy, you can grow your brand and brand awareness with consumers while finding ways to use Amazon as a brand ambassador and a tool in your marketing and sales tool kit.
Digital Operative is a digital marketing and ecommerce agency.
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