Online merchants will on average add 50 per cent to their sales if they open an Amazon Marketplace store alongside their own branded site, the chief executive of a host of 50,000 ecommerce sites has advised.
Brent Bellm has run BigCommerce from its Austin, Texas, headquarters since mid-2015, and has overseen revenue surpassing $100 million a year at the software-as-a-service platform for e-tailers, which launched in a spare room above a mobile phone shop in Sydney’s inner west in 2009.
Mr Bellm said that on the eve of the Amazon’s Australian launch, too many in the retail business still viewed the American giant as an enemy rather than a potential partner.
“And that used to include BigCommerce. When I came in, there was no strategy for working with Amazon, only helping our customers to compete with it, and I said ‘guys, this is self-defeating’,” Mr Bellm told The Australian Financial Review.
Around half of US consumers today start their product searches on Amazon, and Mr Bellm said those retailers with no presence on the platform were inviting failure.
“It’s the older, multi-category, omni-channel retailers that try and go head-to-head with Amazon and are too proud to put a store on there that Amazon always damages the most,” Mr Bellm observed.
Last year BigCommerce launched a suite of tools allowing its customers to open an Amazon Marketplace store but retain a single view for inventory, reporting and payment processing.
Those that maintained their own branded site as well as an Amazon Marketplace outlet found on average that two-thirds of their sales still came through the former, Mr Bellm said, citing surveys of BigCommerce’s 35,000 customers in the US.
“Put another way, the Amazon channel has added 50 per cent to their sales,” Mr Bellm said.
He put Amazon into a category of internet giants that most e-tailers were better off embracing than avoiding.
“Most merchants who try to figure out stuff like artificial intelligence on their own will lose a lot of money. If you integrate and play by the rules with Amazon, ebay, Google, Facebook, they are going to do all the work powering your search results and personalisations for you.”
Mr Bellm acknowledged many Australian e-tailers were worried that opening an Amazon Marketplace outlet meant that it would outrank their own website in search results, replacing full-margin sales with those where Amazon takes up to a 15 per cent clip.
However he said Australian sellers of their own branded products via their own website had a headstart over newcomer Amazon, which they could easily maintain.
“As long as the quality of what’s on your ‘Product details’ page is the same as what you put on Amazon, and your tagging is best practice, you will outrank Amazon just because of the extra time you have been around,” he said.
However Mr Bellm recommended e-tailers that had not done so already to pay more attention to encouraging customer reviews.
“Reviews are critical to search rankings and Amazon won’t have much in the way of reviews of locally-branded products when it launches here, but they’ve done a great job with reviews in the US and they will here, too, so the locals will have to work to stay ahead,” he said.
BigCommerce embedded search engine optimisation into its customers’ websites, Mr Bellm said, but he recommended e-tailers also consider contracting third-party bloggers to write about their wares.
Bloggers are able to register with Amazon as an affiliate, and then earn commissions on sales generated from Amazon backlinks in their articles about products.
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