Nowadays, Amazon is the largest retailer in the world.
Additionally, in September 2019, over 150 million mobile users accessed the Amazon app, making it the most popular shopping app in the U.S. By comparison, Walmart was in second place with a mere 76 million users.
However, if you work for a smaller ecommerce business, you’ve likely struggled against the Goliath that is Amazon. If your products or services don’t rank at the top on Amazon, it’s easy to get lost in the mix — but avoiding Amazon altogether isn’t a good strategy either, since the majority of consumers turn to Amazon first when shopping online.
To help you boost sales and exert brand control on Amazon, I sat down with James Thomson, former Business Head of Amazon Services who now consults brand executives on how to optimize their distribution strategy on Amazon marketplace. Thomson spent over five years at Amazon, and recently published the book Amazon Marketplace Dilemma: A Brand Executive’s Challenge Growing Sales and Maintaining Control.
Here, let’s dive into Thomson’s advice for selling “on” versus “to” Amazon, how small brands can succeed in the crowded marketplace, and the biggest lesson he learned as an Amazon executive.
1. In your book, Amazon Marketplace Dilemma, you mention this dilemma most brands face — to sell “on” or “to” Amazon. While I know it’s a complex topic, could you start by providing me with a sense for what determines whether a brand should choose one option over the other?