We hear the same story from brands all the time—Amazon is your fastest growing channel. But when you dig a little deeper, are your profits growing as fast as your revenue?
At Pattern, we know maximum profitability comes from brand control on the marketplace giant, and we work with top global brands to control distribution and your channel, by removing unauthorized sellers, to accelerate growth on Amazon.
In retail, wide distribution is king. But online, wide distribution causes problems.
Before online shopping, wide distribution allowed brands to get in more stores, reach more customers across more doors, and make more sales. This model worked because it was more time-consuming and inconvenient for customers to drive back and forth between a myriad of stores to find the lowest price and then circle back to make a purchase. Depending on the price point, customers may have bought the first or second option they found.
In the ecommerce realm, however, customers can compare multiple online sellers within seconds, whether they are shopping from home or price checking in-store. And since all of your sellers are carrying the same product, with the same quality, the only differentiator is price. If one seller lowers their price to win sales, they inadvertently create channel conflict across both your online and in-store prices. Then, in order to compete, other sellers must lower their price as well, starting the domino effect of price erosion and your brand’s profitability death spiral.
Narrow distribution online allows you to better control who has access to your products, where it’s sold, and how much competition exists.
If wide distribution opens the floodgates, narrow distribution is the lock that holds everything closed. Without carefully selecting a narrow list of authorized distributors, your product can make its way into the hands of unauthorized sellers across marketplaces and retail sites. Then, unauthorized sellers will cut price to achieve one goal—offload product online as fast as possible to make a quick profit.
Whether the unauthorized sellers bought your product in bulk when your price had eroded to its lowest level on Amazon, or were an honest wholesale buyer who needs to liquidate excess inventory from their big box or boutique store, unauthorized sellers damage your brand. By narrowing your distribution to an authorized list of select sellers and stores, you help eliminate the opportunity for your product to be passed around. Narrow distribution cuts off the bandits' supplies.
As a bonus, when you maintain a list of authorized and unauthorized sellers, you send a message to your distributors that those who don’t comply will lose the opportunity to sell.
At Pattern, we work as your exclusive Amazon distributor, instantly helping narrow your distribution. Additionally, we provide best-in-class technology to identify and track unauthorized sellers. We then work with top tier eControl partners, like Vorys, to analyze and interpret the seller data, and allow Vorys to action all necessary legal steps. We work to give our partners all the resources they need to enforce their MAP policy and support their control strategy.
Having unauthorized sellers on Amazon blocks your profitability. Unauthorized sellers get a hold of your product, drop the price to win the Buy Box, and steal your sales. But that’s just the start.
When unauthorized sellers lower the price, they create price erosion. With one unauthorized seller taking all the sales at a lower price, your authorized sellers are forced to lower their price to compete, but then the unauthorized seller just lowers the price again, creating a race to the bottom and eroding your profit margin along the way.
With a rampant price erosion problem, consumers will acclimate to the lower price. When new products are released, customers may choose to wait for lower prices on Amazon. But that’s not where it ends—the nature of Amazon’s marketplace means unauthorized sellers have the same level of access as you to update your listing images, copy, and branding. So, in an effort to make a quick sale, unauthorized sellers can misrepresent your brand and create a poor user experience, hurting your hard-earned reputation. Over time, this devalues your brand and hurts long-term profitability.
While unauthorized sellers can feel like the biggest threat, removing them comes only after narrowing your distribution. If you don’t address the root of the problem it’ll just keep growing. But, with precise distribution in place you can start successfully removing the remaining unauthorized sellers to create a clean selling channel.
Pricing policies, like MAP compliance, are key for removing unauthorized sellers. MAP policies give clear guidelines to sellers and make addressing violators easier. Afterall, how well can you reprimand someone for breaking a non-existent rule?
Pattern helps brands remove unauthorized sellers by marrying data from our proprietary technology with a Vorys partnership. Using actionable data-driven insights, Vorys can assist in creating and enforcing a MAP policy, identifying unauthorized sellers, and enacting takedowns.
Maximizing profitability on Amazon comes down to controlling your distribution and sales channels. While the steps sound simple, this process can become complicated and cumbersome for brands to handle alone—that’s why Pattern provides the technology, expertise, legal partners, and experience to help you achieve brand control.
Ready to maximize profitability on Amazon? Set up a meeting today.
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Peak season is almost upon us and with all signs pointing to it starting earlier than ever, with Christmas gifting searches now ramping up in August and September, it’s time to start preparing for peak. In this article, we’re sharing our top five tips for planning and preparing for peak season with Google Ads and the strategies required to get your Paid Search ready so you can drive success over this crucial period.
In 2021, gifting search terms started increasing in popularity in August. The general trend is that people are looking, researching and weighing their options early, so it’s best to start your Paid activity early to ensure that you’re capturing that early research traffic. This will help drive revenue alongside aiding those consumers who are in their research phase.
From 2020 to 2021, spend during Cyber Week actually only rose 2% but in the weeks leading up to it, it increased by 16%. However, Cyber Week is still the biggest period during the latter half of the year, accounting for 23% of all online spend by consumers over peak. Being prepared and starting early will help you to maximise your time during this period.
According to Google, 48% of global consumers have stopped buying or using a service due to privacy concerns. Privacy is front of mind when consumers are shopping online and we know that Google is phasing out 3rd party cookies in 2023. This is going to make it much harder to track users online and it’s something that brands need to think about this now – waiting isn’t an option.
From a Google Ads point of view, you want to ensure you have set up the Google Ads tag across your site and have enabled ‘Enhanced Conversions’, which ensures all conversions are tracked and allows you to monitor other actions such as ‘Add to Cart.’ This is relatively easy to set up, especially if you use ‘Google Tag Manager’.
It’s also vitally important that you build up your first-party data during this time as this is data you own and it can be used when targeting consumers that have provided your brand with their email address. Pattern’s own experience shows that by segmenting and using first-party data, you can see a 10% improvement in revenue and ROI.
A full-funnel approach is now more important than ever as consumers become more discerning and have more choices than ever of where to shop.
Pattern has seen success with Google Ads’ ‘Discovery Campaigns’ (image-based ads that appear on Google platforms such as Gmail and the Google app), which have driven success both from a traffic and revenue perspective.
The performance of these campaigns is significantly enhanced by adopting a segmented and nuanced approach to first-party data and incorporating these into your campaigns. Other options for a full-funnel approach include YouTube and testing bidding on keywords that are more representative of the research phase. (e.g. ‘best baby clothes’ for a baby clothes brand)
Earlier this year, Google announced that they were moving away from Smart Shopping and launched Performance Max. This is a new campaign type that incorporates features and placements from Smart Shopping but expands them onto other platforms such as Gmail but also alternative creative options, such as images and videos.
Since Google has already started automatically upgrading Smart Shopping campaigns to Performance Max, expect to see some fluctuations in the first 2 weeks following the switch over but results generally seem positive. We recommend upgrading sooner rather than later to limit any potential impact to peak period.
Peak period will be even more competitive than in 2021 and you’ll need your budgets to support this period, we recommend boosting budgets in October to start capturing that early peak traffic. As we enter November and the Cyber Period, start early and make sure you are capturing those consumers looking for early bargains, ensuring you are being nimble in your optimisations and reacting to the data that you are seeing.
Overall, peak period is vital to help drive your sales and by preparing early, you will see strong results and drive success for your brand. If you want to discuss how your brand can navigate this next peak period, contact us to discuss your options with our performance team now.
Entering the ecommerce landscape is a huge undertaking for any brand—it usually requires a large investment in resources and expertise to really be successful. Any brand can quickly get in over their heads trying to navigate the nuances of SEO, fulfillment and logistics, distribution control, listing optimization, and meeting the numerous other requirements and administrative tasks to show up well on marketplaces.
Unfortunately, because it’s so easy for third party, gray market, and unauthorized sellers to obtain and sell products online, many brands find themselves pressured to execute an ecommerce plan without the right resources to succeed on marketplaces and their other channels.
So, for brands looking to enter the ecommerce space or improve their current and future performance, it makes sense to partner with an ecommerce consultant.
Pattern’s global presence and proven success with hundreds of brands has allowed us to develop highly effective ecommerce consulting services. We can guide your brand to navigate issues both large and small in marketplaces worldwide. To maximize your ecommerce efforts, you’ll need to understand what an ecommerce consultant does and how to select one who drives the right value for your brand and products.
An ecommerce consultant is a specialist in the ecommerce space who can give you personalized guidance on how to market your products and grow their presence on digital marketplaces.
An ecommerce consultant should be able to analyze your brand, audience, category, opportunity, and current roadblocks and help you understand how to utilize your resources (or what resources are missing) to be most effective in capturing your opportunities in the ecommerce space.
Not sure how to evaluate a consultant? Here are 4 key attributes to look for as you make your choice.
At Pattern, we prioritize brand obsession for a reason—we know that a brand-centered mindset makes a crucial difference in the outcomes and results our partners achieve. So in our experience, when you begin your search for an ecommerce consultant, it’s important to look for a partner who is specialized in ecommerce, invested in the product, and passionate about helping brands build and improve their strategies. Typically, this means finding someone that consults exclusively for ecommerce marketplaces, rather than choosing a consultant who offers many different services.
It’s also important to avoid choosing a consulting partner who can’t deliver the right experience for your brand. The best indication of whether your potential consultant can do that is to review their history, data, and results with other brands. Ask if they’ve helped others in your selling category, if they’ve solved specific issues your brand is facing, and why they feel you are a good fit. The key is to leave the conversation feeling confident that you understand your consultants’ capabilities and whether or not they match up with your needs.
It’s best to pick a consultant who knows how to guide a brand onto and through multiple marketplaces worldwide. You’ll want to take a look at your long-term strategy and think about the regions and platforms you’re currently on and where you might want to take your brand in the future. If your consultant is truly great at what they do, they’ll be able to help you perform well enough with your current product roadmap that it’ll be a no-brainer to expand your presence at the right time.
The most effective partnership with an ecommerce consultant will be able to give you both recommendations and point you to solutions for making those changes in your planning, processes, and execution. Your time and money is valuable, so you want to make sure that you’re spending it as efficiently as possible as you follow your consultant’s advice. So, before you commit to an ecommerce consultant, ask about the resources and concrete solutions they typically recommend to the brands they work with.
Finding an ecommerce consultant that checks the boxes can be a difficult task. At Pattern, our entire focus and drive centers around giving brands the tools and resources they need to succeed on domestic and international ecommerce marketplaces.
With over 100 global ecommerce consultants across 10 global offices, we have the right tools to partner with brands across the world to achieve better ecommerce success. We give specialized advice, then make sure our partners have all the adequate SEO, social media, CRM, Amazon multi-channel fulfillment services, and ecommerce outsourcing services they need.
Interested in ecommerce consulting services? Set up a call here to learn what Pattern can do for your brand on global marketplaces.