Can you guess how much Amazon earned last year?
A whopping $576 billion!
That’s why despite the risk of being ignored due to the dense seller population, many merchants still gamble on the platform for a piece of that sweet revenue. But if you want your success to be more certain, then our news lineup today might just be something you need to read.
- Sellers’ fears in 2024 👻
- The best way to beat your competition 💡
- Walmart’s new secret weapon against Amazon 🗡️
- Anti-deal fatigue steps 🙅
POST OF THE WEEK
AMAZON NEWS
Good news: Amazon dominates the U.S. ecommerce industry, helping sellers reach around 38% of the market share.
Bad news: Amazon dominates the U.S. ecommerce industry, almost monopolizing 50% of the revenue. This leaves other retailers little to share.
According to Practical Ecommerce, this isn’t the only thing that scares other industry players. 😨
Amazon marketplace fears in 2024
1. Overdependence on Amazon
The ecommerce giant offers irresistible seller services, especially FBA and Amazon Logistics. That’s why many merchants are becoming fully reliant on Amazon to run their businesses.
However, this convenience comes with a cost. Earlier this year, Amazon restructured FBA fees and added 15 cents to the cost of each item sold and managed via FBA.
Borrowing Practical Ecommerce’s words, “a merchant that depends on Amazon for most of its revenue has no obvious choice but to pay.”
2. Increasing advertising costs
To maximize audience reach on the platform, some sellers opt to use Amazon Ads. To some extent, this decision is justifiable, as this service helps:
- Tap high-intent buyers;
- Provide a seamless shopping experience; and
- Collect third-party data.
BUT… there’s the issue of high fees again. If you’re a small and medium-sized business owner, would it be worth crushing your margins in exchange for a little more exposure? 💭
3. Fiercer competition
With the development of generative AI technology, experts believe that organic search traffic will drop by 25%. This could affect ecommerce stores with their own websites, which might flock to Amazon to find another traffic source.
💊 The best remedy: Fight AND flight
All concerns above are legitimate—but not completely unsolvable. The key is to face them head-on while looking for the best alternatives.
For instance, you can explore other platforms and try selling on them. This could help maximize your yields and market presence. Just be extra careful not to mix rules and regulations to avoid losing your selling (and earning) privileges.
TOGETHER WITH REVIEWSCOOP
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BITES OF THE WEEK
- Alexa Overhaul: Amazon will soon introduce an AI-powered Alexa—but with paid plans.
- TV Ads No More: Global retail media overtakes TV advertising and will probably double in spending for the next few years.
- SHOP313 2024: Detroit Pistons and Amazon co-hosted a summit to promote small community businesses.
HOT TOPIC
Walmart Realm is Amazon’s newest virtual threat
The Goliath vs. Goliath battle between Walmart and Amazon continues in 2024 as the former reveals a new secret weapon: Walmart Realm.
William White, Walmart’s CMO, shared a LinkedIn post showcasing the first-of-its-kind gamified marketplace that targets Gen Z shoppers. Here’s the scoop on the new virtual threat that could challenge Amazon’s ecommerce crown:
🎮 Shopping made fun
If Amazon brings convenience to shopping, Walmart brings the fun. According to White, Walmart Realm aims to dominate the virtual space by:
- Incorporating ecommerce with metaverse concepts and strategies.
- Recruiting the help of macro-influencers to curate the product selection. As of now, most of the available items on the platform are fashion and beauty products priced under $50.
- Adding games with prices that shoppers can use to purchase items on the platform.
Is this Walmart’s chance to beat Amazon?
Well, it’s too early to tell because Walmart Realm still needs to convince buyers to go there. Also, Amazon’s cooking a move to drive more engagement in the virtual space. 🍳
Still, the entry of Walmart Realm definitely spices up things in the Walmart vs. Amazon saga.
SELLER REFRESHER
How to combat consumers’ deal fatigue in 4 ways
Even as ecommerce continues to change one thing remains the same—sales and discounts are the main motivators of consumers. But believe it or not, there are times when these things lose their charm, such as when sales events with the same deals come right after one another.
📍 This is called deal fatigue, which can severely impact your sales when not handled well. Fortunately, Feedvisor has shared some tricks to stand out:
- Highlight what your product offers. Big discounts aren’t the only thing that entices customers to buy. Pointing out what makes your product unique has the same effect (sometimes better). 👌
- Personalize your recommendations based on customer preferences and behavior.
- Bundle deals—but do it strategically, not randomly. For example, group health and personal care items for a “self-care kit” or bundle tumbler and coffee/tea for a “hydration package.”
- Use multichannel marketing. Advertise your deals on social media or via email or SMS to widen your reach.
🪜 Bonus hack: Step up your customer service
Because if there’s one thing that will help shoppers remember you better, it’s excellent after-sales support. Besides, when did good customer service fail to ease customer stress?
