Amazon has a current market cap of $390 billion. That’s more than the combined total of the top eight traditional brick-and-mortar retailers that includes Best Buy, Macy’s, Target, JCPenny, Nordstrom, Walmart, Kohl’s, and Sears.
As these traditional retailers seemingly struggle, Amazon continues to report its growth. It’s not a surprise then that retailers are flocking to the Seattle-based marketplace to sell their own items. Merchants are after a small piece of a big pie.
However, just selling on Amazon doesn’t equal success. Selling on Amazon is competitive. This article gives you our top five mistakes that you could be making on Amazon and hurting your sales.
Top 5 Mistakes to Avoid When Selling on Amazon
If you’re already selling on Amazon, evaluate how you’re doing in these five areas. These are the mistakes that you want to avoid.
Incomplete or Incorrect Product Data
Amazon’s marketplace is crowded and competitive. There are millions of products on Amazon that customers have to search through. Luckily, Amazon makes product search easy by organized categories that buyers can drill down into.
How easy it is a for a buyer to find your product depends on your product details or description. Therefore, it’s essential that your product information be complete and accurate. If it’s not, buyers won’t find your products.
Product descriptions also give customers confidence to buy. Since they can’t rely on physical touch and sight, customers depend on your product information to ensure they’re getting exactly what they want.
Are your product descriptions incomplete and incorrect? If they are, your products might not be visible to buyers.
Fix It: It can be hard to manage product data for thousands of products. If you have the correct data stored in an ERP or Point of Sale system, multichannel listing software can help you list your products to Amazon exactly as Amazon requires it.
Overselling
A key component of your product data is inventory. Buyers need to know if an item is in-stock and available for purchase. It also helps to show if an item is in low stock so a buyer knows they need to act now.
Proactively managing your inventory also ensures you avoid overselling. Nothing’s worse than telling a customer you can’t ship an item they bought because you don’t actually have it.
Amazon takes this seriously. Overselling can cause your account to be penalized and ultimately suspended. You won’t be able to sell on Amazon again.
Inventory availability is crucial to your success. It can’t be taken lightly.
Fix It: Inventory management becomes difficult when you sell across multiple channels. The same product could be sold on your Amazon account and webstore. Merchants often use integration software that syncs inventory levels across multiple channels in real-time. This ensures your product stock levels are always correct.
Late or Costly Fulfillment
A crucial part of Amazon’s success is their free, 2-day shipping service for Prime members. Customers trust their items will be delivered quickly, on-time, and without cost. This is often why a buyer chooses to buy from Amazon and not another eCommerce site.
Most customers look for products then that are denoted as Prime or Fulfilled by Amazon. If the product isn’t, they still expect to see reasonable shipping times and cost. You can also expect poor reviews when customers don’t receive your package on time. A delivery date is a promise you can’t afford not to keep.
Merchants who don’t offer fast, low cost, and reliable fulfillment can’t compete on Amazon. Other merchants will be able to provide better.
How reliable is your fulfillment? Are you losing sales because your shipping costs are too high?
Fix It: Consider using Fulfillment by Amazon (FBA), which is Amazon’s program that third-party sellers can use to have their items shipped by Amazon. Your products will even get the “FBA” logo next to them so customers can trust they’ll be delivered on time. Check out this article to see whether FBA is worth the cost for your business.
Not Leveraging Customer Reviews
Customers reviews can go either way for sellers. Stellar reviews can lead to more sales. Poor reviews can spin out of control leading to distrust and loss of sales. However, the fear of poor reviews shouldn’t stop you from asking for them.
Buyers turn to reviews because they want honest feedback from their peers. 92% of consumers now read online reviews vs 88% in 2014. It’s part of how customers buy.
If you aren’t leveraging customer reviews, customers are missing out on critical insight to help them make a purchase decision.
Fix It: The best way to increase your customer reviews is to simply to ask for them. It’s great practice to follow-up a purchase by asking about their experience and to leave a review.
If you get a bad review (they’re inevitable), don’t panic. Take the time to respond and try to fix it. By doing so, you could regain the trust and the business of that customer.
Competing Against Amazon
It’s hard to compete against other sellers on Amazon. It’s even harder if one of those sellers is Amazon itself.
Amazon often sells products itself, especially if it’s a highly sought after product. You want to avoid selling products that Amazon already sells. You won’t be able to compete with their margins or inventory levels.
Fix It: Before you decide to sell something, do some research to see if Amazon sells the product itself.
Winning the Amazon Buy Box
These five Amazon mistakes are important because they can affect your ability to win the Amazon buy box.
When you search for an item on Amazon, there’s a featured seller to the right of the product. Customers can click “add to cart” from this box The featured seller gets more sales because they’re the first buying option.
That’s why so many sellers strive to win the Amazon buy box for their products. You’ll most likely see an increase of sales.
Unfortunately, there’s no secret formula to winning the buy box. Amazon doesn’t release that information. All sellers know is that you have to meet these criteria to be eligible for winning it.
- Complete and accurate product listings
- Lower price
- Delivery speed and shipping method offered
- Order Defect Rate
- Seller Performance
- Customer experience
- Time and experience on Amazon
- Available inventory
You can see that the five areas we discussed above are truly impactful on your selling success on Amazon.
See other articles about how to improve your success on Amazon.
I would recommend Amazon over eBay but still both are great.