In a press release from April 9th, 2019, Amazon revealed that in 2018 there were over 1 million 3rd party sellers in the US Marketplace. This is an incredible number of sellers, which also means that there is an incredible and growing number of competitors out there in virtually every product niche, and a click away from each other.
How does a business stay relevant and make profit in such a competitive environment?
1. Sell something unique.
If you are selling the exact same thing that dozens of other sellers are selling, the purchasing decision for this product will be made strictly on price, so you will see margins getting thinner and thinner until they disappear. However, if you create a product and sell it the way no one else in your niche is, you will stand out and win the sale. To do this, get to know your customers, learn their likes and dislikes and make a product that caters to those needs.
You might say that even if you do this, nothings stops your manufacturer from jumping on your listing and winning the sale with lower pricing.
This is true, especially where for items that can't be protected by patents, and the best way to protect yourself against this is to
create a brand.
2. Creating a brand is much more than taking a product and slapping a logo on it.
A brand is a product/ service offering that delivers consistent and desirable quality and level of customer experience that overtime creates a positive reputation. So your best bet is to create a solid brand message and broadcast it as much as possible. Amazon supports brand development and offers different branding and analytics tools on their platform.
If you take the time and resources to make the experience of buying and using the product much better than any of your competitors, you will eventually become dominant in that niche.
3. Establish a presence on multiple platforms.
It is reported that in the US about 50% of all online purchases are made online. This means that there is another 50% that go through other channels, so if you only sell on one platform you lose many potential customers. In addition to that, customers who shop on Amazon don't just select a product and buy it without checking other things. If there are 5 unfamiliar companies selling a certain product, you can be sure the customer will start looking for information outside Amazon in order to make the final decision. If you have a presence and dialogue going on with other customers online, and your competitors don't, you are more likely to get the sale.
The reality is that everything that is profitable attracts people who want a share of the profits, so every business needs to continuously improve an adapt.
