How brick-and-mortar retailers can succeed on Amazon

The popularity of Amazon Marketplace over the years has made Amazon a more attractive destination for brick-and-mortar retailers. In a recent column, I discussed the example of one retailer that relies on Amazon to complement its offline operations. Recently published data suggests that Amazon presents a major opportunity for retailers to attract more business by having a presence on the site. As reported in Marketplace Pulse, 78 percent of keyword searches done on Amazon are nonbranded. In other words, most people are searching for product categories such as “AAA batteries” and “men’s shirts” instead of trying to find names of specific brands. Now consider that Amazon has overtaken Google as the most popular destination for people to do product searches. Brick-and-mortar retailers need to view Amazon as a platform to not only sell more products but to build your reputations. Doing so will create a virtuous cycle of success.

Here’s how retailers can win on Amazon

Winning on Amazon isn’t very different from using digital outside of Amazon. You need to attract customers and keep them. The fundamentals are the same, even if the rules differ from one platform to the next.

Attract customers

You’ve heard it said — how many times now? — about Google, Facebook and other digital platforms that attracting and converting customers is about combining an organic and paid media strategy with the management of customer reviews.

• Optimize for search. For example, optimize product titles and product category descriptions to answer the 78% of nonbranded searches occurring on Amazon. Make sure you include a brief and concise description of what your product does, how much quantity is available, and depending on your category, crucial details such as color, size and price, all of which will keep you in the consideration set for more detailed generic searches such as “men’s shirts size medium.” Pay close attention to how you manage Amazon backend keywords, which are keywords that you use on the backend of your seller account. And, in the age of visual storytelling, it’s essential to use strong, clear images that allow shoppers to do detailed comparisons.
• Capitalize on Amazon Advertising. Amazon is putting a dent into Google’s and Facebook’s dominance of online advertising, as I discussed in a column last year. Its share of digital advertising, while small, is rising and stealing business from Google in particular. Over the past few years, Amazon has unleashed a slew of advertising products for businesses whether they sell products on Amazon or not. Among the popular Amazon Advertising products: Sponsored Products, which make it possible for businesses to promote products to shoppers who are searching with related keywords or viewing similar products on Amazon. They appear as inventory alongside search result. People who click on the Sponsored Product listing are taken to your inventory. On the other hand, Display Ads serve up relevant ads to shoppers who are actively viewing specific products – and the content can appear on a competitor’s product inventory. These are just a few of the products available among Amazon’s rapidly expanding toolset.
• Mind your reviews. Customer reviews on Amazon function like they do on Google: they increase your chances of being chosen, and they make your products more visible. In fact, reviews are among the most important ranking factors under Amazon’s A9 search algorithm. Unfortunately, unethical businesses are trying to game the system with fake reviews. But fake reviews are not a reason to ignore a strong reviews program. It’s important to proactively managing reviews – and, yes, managing reviews means asking for them, so long as you adhere to Amazon’s terms of service (such as using the Seller Central Buyer Message system). 

Keep customers

Keeping customers is about being vigilant to monitor input from customer reviews to improve your products and services. Here is another reason why managing your customer ratings/reviews on Amazon is essential as well as far-reaching in scope: they are the building cornerstone of your reputation.

A five-star review in and of itself doesn’t mean a whole lot. But a pattern of reviews over a period of time gives you valuable unstructured data that you can and should use to improve your service, whether you need to price your products more competitively, carry a better selection of inventory, or improve your fulfillment practices.

Reviews help create a virtuous cycle on Amazon: the more positive reviews you get, the more likely it is that those non-branded searches are going to land on your merchant page. When people come to your page and see those reviews, they are more likely to buy what you are selling. The reviews, in turn, also give you feedback to help you improve your products and services, which leads to more positive reviews.

But you don’t create this virtuous cycle unless you use that input from reviews to get better.

What you should do next

There’s another major benefit to being on Amazon: you’ll protect yourself as Amazon expands into physical retailing through operations such as its brick-and-mortar bookstores and Amazon Go for groceries. If you are a well-established retailer with a strong local presence, you have an edge – and you can capitalize on it by relying on your storefronts to manage product fulfillment for your online presence. But that edge may not last. The time is now to act by taking advantage of the strengths of retailing’s largest online search platform.