How to Know if Amazon is Working for Your Brand: 6 Questions to Ask

Rob White

March 10, 2022

When it comes to marketplace ecommerce, maximizing your brand’s potential on Amazon is vital to any strategy—but it can be difficult to determine whether Amazon is working for you based on sales alone. Many factors influence your brand’s success on Amazon, and some aren’t as obvious as conversion rates or year-over-year growth.

So how can you understand where your brand stands on Amazon? We’ve compiled a list of questions that uncover if Amazon is truly working for you. And in the case that your brand is falling short in any of these areas, we’ve also offered practical suggestions on how to improve.

Are you growing as fast as your category?

Obviously, profitability is an important factor to keep in mind when considering whether Amazon is working for your brand. But keeping up with your competitors isn’t as cut-and-dry as it seems—you could be making a decent profit on Amazon yet still be underperforming in your category or market.

Almost every brand is growing on Amazon. A rising tide lifts all boats, as they say. What brands need to determine is whether they’re rising as quickly as others in their market. You may have had 40% year-over-year growth and feel happy with that, but if the rest of your market had 50% year-over-year growth, you’re ultimately losing market share.

Check how your product measures up to competitors in terms of pricing, reviews, and content. If a competitor offers a similar product with a lower price or better reviews (either in ratings or number), your product may struggle to keep up on sales. Consider ethical ways to get reviews or better calling out the qualities that make your product more expensive.

Is your price stable on Amazon?

Loss of price control online is a major pain point for many brands. If another vendor is selling your products on Amazon, they will control every aspect of the listing, including content and pricing. These sellers rarely, if ever, value your brand image and reputation as much as you do. As such, it’s likely they will cause price erosion by selling your product for lower than MAP and tarnishing your brand’s name with subpar listing content. This not only hurts your price, but the control of your overall branding.

Enforcing a MAP policy can be a lot of work, but pays off in your profits, branding, and distributor relationships. You may also consider working with fewer or even a single authorized seller to ensure your product is always listed at the price you approve.

Are you staying in stock?

Going out of stock can be one common cause for decreased sales, especially in COVID times. So how is your forecasting and inventory management going? Are you spending more time worrying about issues, dealing with Amazon support, or making last minute production orders than is worth the profits you see from the platform?

Working with your historical data to forecast sales and inventory needs is crucial to marketplace success, especially because temporarily out of stock products can cost you long term rankings and sales.

How do your data reports trend?

Taking a look at Amazon’s metrics is a quick way to determine how you’re performing online and where you can improve. Check your sales patterns, your traffic, and your conversion rates, but make sure to check how they trend over time. If your sales are decreasing, take a deep dive to discover why—but don’t forget to account for seasonality or historical sales events and promotions.

If your traffic is low but your conversion is high, you know there’s an opportunity for more success with increased advertising and traffic. If your traffic is high but conversions are low, you know convincing people to buy is the problem and you can look at your image stack, product description, and overall listing appeal.

Do your Amazon listings strengthen your brand?

Amazon has evolved to become more than just an ecommerce platform—it doubles as a search engine. Customers look to Amazon to research product options, read reviews, and find additional information. They also price check online vs in-store prices to find the best deal. For this reason, it’s of utmost importance that your Amazon listings accurately and consistently represent your product and brand.

Prioritize publishing top-notch creative content in your listings. Tell your product’s whole story. Answer all of your customers’ questions. Detailed descriptions, clear and concise bullet points, and high-quality images make a big difference in how your brand and product are perceived both online and off.

How much do you have to spend on advertising?

Evaluate how much you’re budgeting for paid ads. If you’re regularly spending through your budget and your ads are getting shut off, you may need to allocate more money to advertising or adjust your ad strategy. Although adding spend may initially cut into your ecommerce budget, it may ultimately pay off. Paid advertising helps your product gain reviews, credibility, and sales, which in turn boost your organic rankings.

It’s also worth evaluating if other brands are targeting yours through conquest advertising. To avoid this, you can invest in defensive advertising by paying to show up in the sponsored search results for your own branded terms, like your company name or product titles. You can also serve the strategy right back and invest in conquest advertising to appear in search results for branded terms of competing brands.

Did you say no to multiple of these questions?

If considering the questions above made you realize your brand has room for improvement on Amazon, it’s very likely that an under-resourced ecommerce team is to blame. We’ve been in the room where executives at large, well-known companies are asked if they have more than 5 people running their ecommerce, and the answer is usually no.

Even large companies still rely on small teams to handle an inordinate amount of work. Realistically, an individual or small team simply does not have the time or bandwidth to do everything necessary to keep ecommerce and marketplaces like Amazon rolling smoothly and efficiently. Add in new marketplaces, new countries, and new languages and they’ll inevitably drop the ball somewhere—due to no fault of their own.

What to do if Amazon isn’t working for you

In today’s ecommerce landscape, giving up on Amazon isn’t a valid option, even if it isn’t currently working for you. If you don’t sell your product on Amazon, someone else will, often cutting at your brand credibility and profits.

Your specific approach to solving your problems on Amazon will, of course, depend on the type and extent of your issues. While we’ve given many examples and strategies here, each brand will require a unique approach tailored to their specific brand weaknesses and strengths.

Need help reaching your potential on Amazon? Learn how Pattern can help fix the concerns addressed above for your brand.

Get in touch.

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Improve Your Amazon Advertising Strategy With One Simple Metric: True RoAS
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Improve Your Amazon Advertising Strategy With One Simple Metric: True RoAS

The purpose of advertising on Amazon is simple: increase traffic and conversions. But the approach to get those conversions is not always so simple. Your Amazon advertising strategy is based on current ad data and performance results such as your return on ad spend (RoAS). 

At a minimum, your RoAS number tells you how well you’re maximizing your ad spend. The problem is the RoAS you’re getting from Amazon or an advertising agency isn’t always accurate. 

As a top 3P seller on Amazon, Pattern helps brands improve their Amazon advertising strategy and results by providing them with one simple metric: true RoAS.

Understanding True RoAS

To understand why true RoAS is helpful to brands, you need to understand how Amazon and other agencies calculate and present your RoAS.

The key to growing your brand and maximizing your ad spend is to drive incremental traffic, rather than cannibalizing what has already taken place. For example, if you are selling probiotics, and paying for sponsored ads to win the keyword “probiotics for women”, but also organically ranked in the top results with the same keyword, that’s cannibalization. The RoAS score you would receive from Amazon includes that level of cannibalism, which inflates the number, causing you to pay more on ad spend. The best ads drive incremental growth instead of cannibalizing organic sales. 

At Pattern, we’ve created the acceleration software to make sure brands are getting their “true RoAS”. Pattern’s patented tool applies artificial intelligence to advertising to maximize incremental growth or true return on investment. 

Our software helps brands optimize their efforts by providing live and updated information on where your brand is not organically ranking, and what you should be paying for. If your ranking improves in one area, the ad spend will automatically decrease for those words or phrases until the software detects a drop in ranking, signaling that your ad spend should go up again. This dynamic monitoring of ad spend will help you maximize incremental growth and improve your RoAS.

Improve Your Amazon Ad Strategy with Pattern

Knowing your true RoAS is key to improving your Amazon performance. Advertising agencies and marketplace account managers often give you an inaccurate RoAS ratio or value, which only incentivizes you to spend more on advertising, ultimately increasing revenue for the agencies and/or marketplaces.

At Pattern, a 3P partner on Amazon and other marketplaces, we view our brands just as that: a partnership. When you win, we win. You succeed on Amazon by maximizing your ad spend and we have the data and resources to help you do just that. Accurate, transparent data and reporting will help improve your advertising strategy to drive more traffic to and conversions on your products. 

Ready to finally get your true RoAS? Contact us.   

Slowing Inflation is Music to Consumers’ Ears
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Slowing Inflation is Music to Consumers’ Ears

**Instrument Pricing Changes Tune Amid Record Inflation** Compared to 2022, consumers should expect to pay more for musical instruments, but the rate of inflation shows signs of slowing. **The backstory:** America’s most popular musical instruments saw a notable price increase in 2022 compared to 2021, but the rate of inflation eased in Q4 ’22. **Why it matters:** Slowing inflation within this product category could indicate economic pressures like increased demand, rising labor costs, and supply chain disruptions are easing across the consumer landscape. **What we’re seeing:** The average cost of musical instruments increased 7.5% from 2021 – 2022; however, when analyzing individual increases year over year, some instruments saw price increases as high as 21%. <iframe title="YOY Price Change for Instruments — 2022 vs. 2021" aria-label="Bar Chart" id="datawrapper-chart-02Lwk" src="https://datawrapper.dwcdn.net/02Lwk/2/" scrolling="no" frameborder="0" style="width: 0; min-width: 100% !important; border: none;" height="379" data-external="1"></iframe><script type="text/javascript">!function(){"use strict";window.addEventListener("message",(function(e){if(void 0!==e.data["datawrapper-height"]){var t=document.querySelectorAll("iframe");for(var a in e.data["datawrapper-height"])for(var r=0;r<t.length;r++){if(t[r].contentWindow===e.source)t[r].style.height=e.data["datawrapper-height"][a]+"px"}}}))}(); </script> * Trombones experienced a 21.73% increase compared to 2021 * Trumpets +20.08% * Flutes +18.6% * Recorders +16.13% * Saxophones +13.63% * Clarinets +10.55% * Drums +5.41% * Ukuleles +5.17% **However:** Inflation among these same instruments was significantly less in Q4 ’22 compared to Q4 ’21. In some cases, prices decreased from Q4 ’21 – Q4 ‘22: <iframe title="Price Change for Instruments — Q4 2022 vs. Q4 2021" aria-label="Bar Chart" id="datawrapper-chart-6X6GZ" src="https://datawrapper.dwcdn.net/6X6GZ/2/" scrolling="no" frameborder="0" style="width: 0; min-width: 100% !important; border: none;" height="379" data-external="1"></iframe><script type="text/javascript">!function(){"use strict";window.addEventListener("message",(function(e){if(void 0!==e.data["datawrapper-height"]){var t=document.querySelectorAll("iframe");for(var a in e.data["datawrapper-height"])for(var r=0;r<t.length;r++){if(t[r].contentWindow===e.source)t[r].style.height=e.data["datawrapper-height"][a]+"px"}}}))}(); </script> * Trombones +11.23% * Flutes +10.41% * Saxophones +5.94% * Clarinets +5.59% * Trumpets +3.10% * Recorders +2.85% * Drums -2.59% * Ukuleles -8.46% **Moreover:** Certain instruments saw inflation reverse in 2022. On average, prices for melodicas, guitars, and violas saw their prices decrease by 4.41%, 3.19%, and 0.97%, respectively. <iframe title="YOY Price Change for Instruments — 2022 vs. 2021" aria-label="Bar Chart" id="datawrapper-chart-0Tefk" src="https://datawrapper.dwcdn.net/0Tefk/3/" scrolling="no" frameborder="0" style="width: 0; min-width: 100% !important; border: none;" height="259" data-external="1"></iframe><script type="text/javascript">!function(){"use strict";window.addEventListener("message",(function(e){if(void 0!==e.data["datawrapper-height"]){var t=document.querySelectorAll("iframe");for(var a in e.data["datawrapper-height"])for(var r=0;r<t.length;r++){if(t[r].contentWindow===e.source)t[r].style.height=e.data["datawrapper-height"][a]+"px"}}}))}(); </script> **Diving Deeper:** Inflation was more significant when comparing Q4 ’21 to Q4 ’20 than when comparing Q4 ’22 to Q4 ’21, indicating a slowing down of price increases for consumers. <iframe title="YOY Q4 Price Change for Instruments — 2020 – 2022" aria-label="Stacked Bars" id="datawrapper-chart-p6iqt" src="https://datawrapper.dwcdn.net/p6iqt/1/" scrolling="no" frameborder="0" style="width: 0; min-width: 100% !important; border: none;" height="206" data-external="1"></iframe><script type="text/javascript">!function(){"use strict";window.addEventListener("message",(function(e){if(void 0!==e.data["datawrapper-height"]){var t=document.querySelectorAll("iframe");for(var a in e.data["datawrapper-height"])for(var r=0;r<t.length;r++){if(t[r].contentWindow===e.source)t[r].style.height=e.data["datawrapper-height"][a]+"px"}}}))}(); </script> * In Q4 ’21, average prices for all instruments were up 8.89% compared to Q4 ’20. * When comparing Q4 ’22 to Q4 ’21, the average price for all instruments only increased by 2.65%. **The takeaway:** While consumers should expect to pay higher prices for instruments this year, overall inflation impact within this product category appears to be slowing down. With National Ukulele Day coming up on February 2, now is a great time for ecommerce brands to take advantage of slowing economic worries and reach new consumers. * Want Pattern’s data science team to power your brand with consumer insights like these? Contact us to [request more information](https://pattern.com/contact-us/) today.

Slowing Inflation? What Musical Instrument Pricing Tells Us
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Slowing Inflation? What Musical Instrument Pricing Tells Us

It’s safe to say consumers and brands alike are eager for a change to the pattern of rising inflation, steadily increasing in many ecommerce categories . Pattern’s internal team’s data scientists analysis of instrument pricing shows a glimmer of hope that inflation may be slowing, which would be great news for brands selling online.

At Pattern, we’re interested in and monitoring trends and news related to pricing since price is a key factor in a brand’s profitability (as explained in the Ecommerce Equation). When brands are able to optimize their price, conversions, and traffic, they can optimize their profitability. And profitability leads to better allocation of resources, better brand control, and gives leaders the ability to expand their presence to new markets worldwide.

YoY Instrument Pricing Increased at a Slower Pace

When analyzing the pricing changes of instruments from 2021 to 2022, our teams found that prices increased, but at a slower rate than from 2020 to 2021.

As shown below, the year over year Q4 changes show quite a lower rate of increase.

Inflation Improvements Raise Profitability

Because inflation impacts online shopping behaviors, lower inflation can lead to better overall profitability for brands. This idea, of course, is nuanced, but Pattern’s Ecommerce Equation can help illustrate the general principle.

When inflation rises, consumers change their spending habits. Shoppers spend more time researching products, forego premium, higher-priced brands, and buy more in bulk. Brands tend to see a loss of loyalty as they’re forced to raise prices.

Price is a key variable in the Ecommerce Equation: price x conversion x traffic = profitability. As inflation lowers, brands can expect better performance in all of these areas—more traffic as spending habits return to normal, higher conversion from returning customers, and price that better fits consumer demand. As inflation lowers and these variables stabilize, brands will see profitability increase.

Raise Your Profitability with Pattern

As an ecommerce accelerator, Pattern is obsessed with gathering data that helps our brand partners succeed. We’ve created best-in-class technology, models, and analytics to understand changes on the horizon and inform our decisions. With an incredible team of data obsessed Pattern employees, we see what makes the difference in truly great ecommerce performance and apply those learnings for brand partners. 

Ready to improve your profitability? Contact us here.