Insights

Control is a Choice For Brands on Amazon

Controlisachoice

2016 has seen its share of A-list brands publicly cutting ties with Amazon. Apple recently announced that most “genuine” Apple chargers sold on Amazon are fake and GoPro decided to withhold select products from the marketplace. Even luxury brands LVMH made it known that Amazon does not fit in with the brand.

What causes brands to publicly and emotionally announce a temporary separation from Amazon?

Counterfeit products? Unauthorized sellers? Price?

Is there something inherent about Amazon or does it boil down to a lack of control?

Because, at this point, Amazon is taking steps to give brands control of these forces to protect what the company values most.

“We want customers to be able to shop with confidence on Amazon,” said Erik Fairleigh, an Amazon spokesman, when a recent plan to fight counterfeiters was announced. “For certain products and categories, Amazon requires additional performance checks, other qualification requirements, and fees.” Retailers who sell products from the likes of Nike and other heavy hitters will have to pay as much as $1,500 per brand, in addition to providing invoices from manufacturers or distributors that show at least 30 items purchased within the last 90 days.

It’s not a guaranteed solution, but a good start. Shortly after this announcement, another update to the customer review policy was issued, eliminating paid reviews that once gave products an unfair (and shady) advantage.

The push for trust and transparency from Amazon are a good sign. Amazon needs premium brands to exist on its marketplace, so making them welcome is important.

The question is, will brands know what to do with that control when it’s freely available?

Control is a choice

We can tell a lot about a brand’s strategy by looking at how it’s presented on Amazon. The platform exposes flaws and strengths through content, policies, processes, and how its retail network is reflected.

Taking control on the channel shouldn’t be the ultimate goal; it’s just a foundation to start using the marketplace to reach, engage, and educate customers. Brands still trying to gain distance from Amazon are only creating opportunities for competitors. Over the next year, we’ll start to see brands that have taken advantage of the situation pull ahead of the pack.

Results of a recent Bloomreach survey showed that as many as 55% of shoppers start their online search on Amazon, even when a purchase happens elsewhere. Brands should be investing in Amazon content that reflects the prices, image, customer service options, and performance points of their products for ‘showrooming’ and ‘webrooming’ shoppers, who use a combination of search and in-store queries to make a buying decision.

When someone at a retail store checks Amazon on their phone and sees it available for a significantly lower price, or sees a string of negative reviews based on poor customer service or packaging, how does that influence their decision? And what kind of message about the brand does that send?

This is what happens to consumers when brands disengage.

The alternative is also possible. Brands can certainly keep choosing to walk away from Amazon. But, if the brand’s products are all still available to customers on Amazon through a variety of third-party sellers, what’s the point?