Amazon Strategies

Making Amazon FBA even better - January 2009 Enhancements

Max Leisten — Wed, 28 Jan 2009 21:11:26 +0000

Amazon has announced two welcome enhancements to its Amazon FBA service that will be great news to sellers taking advantage of this not-so-secret-sales-enhancer.

One complaint from participating sellers has been that on occasion an FBA-fulfilled order would yield negative buyer feedback (let’s say it got lost or was damaged in transit — which is always possible). Sellers felt helpless that a process completely out of their control would count against the merchant. Now Amazon has set a new policy in place (effective 01/27/09) that gives sellers a clear path to petition for strikethrough of customer feedback ratings for FBA orders:

If you have received feedback on an FBA order regarding a fulfillment-related issue or customer service-related issue, you may submit a Contact Us form to request to have Technical Account Management review and “strike through” the customer’s rating. If any portion of the comment applies to the seller or the condition type (New, Used etc.) of the product, the rating will remain.

Another challenge for FBA sellers are the different views in sellers’ accounts to manage inventory and orders. For example, there are separate views for merchant-fulfilled orders vs. Amazon FBA orders. And while the All Inventory view shows all of your SKUs, you need to toggle back and forth to the Inventory Amazon Fulfills view to determine which SKUs have available quantity if they’re shipped from an Amazon warehouse.

Amazon is listening to its FBA merchants and will shortly introduce a merged Manage Orders page that will display both merchant-fulfilled and Amazon-fulfilled orders so that you can see on a single page everything selling on this channel (as well as Basic Fulfillment orders for non-Amazon purchases — one of the great benefits of FBA).

During the month of February, Amazon will finalize merging Manage Orders and Manage FBA Orders into one page. Currently, the Manage Orders page gives information about FBA orders only after they have shipped. The new view will show both the Manage Orders page with Manage FBA Orders to create a single page with all Amazon Fulfilled Network (AFN) and Merchant Fulfilled Network (MFN) orders in one location, regardless of order status. The Manage FBA Orders view will remain in the user interface and will continue to show only AFN orders.

Keep enhancing this service, Amazon!

Clarification from Amazon following the policy announcement:

The new feedback policy announced in the January 28, 2009, FBA Merchant Update is not retroactive. Only feedback posted by a customer on January 27, 2009, or later will be reviewed for strikethrough.

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Amazon.com 1: BestBuy.com 0

Max Leisten — Mon, 26 Jan 2009 16:15:38 +0000

Amazon is scheduled to release Q4 2009 earnings this Thursday, January 29th, at 5 p.m. EST and I think it will report good holiday numbers compared to eBay’s recent 12% drop in GMV. The current year will be a challenge even for online retailers but I believe that a recession will accelerate a migration to online / deal shopping (I even see more free shipping offers on Amazon).

Here’s another great example of why Amazon is going to continue to grab market share and will do relatively well even in this economy. Over on the Technology Evangelist blog you can see a comparison between BestBuy.com and Amazon.com for a Canon SD880IS digital camera with Amazon winning hands-down in the merchandising category:

1. First thumbnail is of the back of the camera.
2. 98 Reviews
3. Amazon’s price, and three other supplier’s prices are displayed.
4. Free shipping is offered.
5. Related products are displayed along with the percentage of times people purchased them instead.
6. They explain when I can expect this to arrive if I purchase it now.

These are of course all elements of Amazon’s secret sauce: the ability to add customer photos (on top of the up-to-8 images the merchant can add), the leading customer reviews site on the web, third-party merchants competing to offer the best price and service, and good communication throughout the order cycle.

If anybody has any other good examples (an online merchandising deathmatch?), post them as a comment.

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Leveraging Amazon product reviews to drive sales

Max Leisten — Sun, 18 Jan 2009 17:49:14 +0000

Belkin’s public relations team has probably been in meetings all weekend on how to respond to charges that Belkin has been paying for positive customer reviews on Amazon.com. Daily Background’s Arlen Parsa uncovered this week an Mechanical Turk offer (what’s Amazon’s Mechanical Turk?) to review the certified stink of a Belkin USB 2.0 Hub.

I can certainly understand the temptation here since I am sure that hub was not selling (driving a significant price drop) but this may not only get you into hot waters at Amazon (they probably care very much about the quality and validity of product reviews) but is leading to serious brand damage:

“I’ve never been a big fan of Belkin, but man, they’ve really convinced me. To not buy a single thing from them ever again.”

“I think there should be mass backlash for trying to deceive the public. If I purchased the product, taking into consideration their fake reviews, and found the product was crap after all then I’d be throwing bricks through Belkin’s office windows.”

Product Reviews Policy?

Amazon’s Customer Reviews Policy calls out that “Solicitations for helpful votes” is not permitted. Since product reviews are a significant sales accelerator, what CAN sellers do to yield more product reviews? I would love to see an official post on the Amazon Seller Support blog on if and how sellers may incent customers to leave product reviews, but here’s what I believe you can and should do:

Reach out to your Amazon buyers to solicit reviews when you only have a few or mediocre reviews. Simply inquire how they like their product and if they would mind sharing their thoughts on the Amazon Product Page (include a link to the page). Remember here not to recommend a positive review and don’t promise an incentive. And do not include any type of marketing of your own site (if you have one) although I think you should have links to your Amazon storefront.

When launching a new product on Amazon (nobody else is selling it), reach out to recent buyers of your products in the same or similar product category and check if they’d be interested in trying it and posting their reviews on the page. Let’s say you sell pillows on Amazon and would like to start offering a new line of pillow covers. Giving five of them away to drive product reviews (who doesn’t like free gifts?) may be a smart investment and may also yield blog posts or discussions on Amazon. And after all that’s just what the Amazon Vine program is designed to do.

And if you’re still not convinced that reviews can help your sales then read this Dell case study.

On A Lighter Note

And speaking of Amazon product reviews, here are two funny examples courtesy of the satire reviews sub-culture on Amazon: Playmobile Security Checkpoint Point and the book The Secret. If you’re an afficionado of fun and interesting reviews, follow this new thread on the Amazon Seller board.

What are your positive / negative experiences with product reviews on Amazon?

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A-to-Z Guarantee Improvements: Buyer-to-Seller Communication

Max Leisten — Tue, 13 Jan 2009 12:21:14 +0000

Amazon announced yesterday improvements to how buyers can initiate an A-Z claim that should also help sellers minimize the number of claims by providing more transparency into communication between buyers and sellers, and forcing the buyer to first work with the seller before initiating a claim.

“We expect sellers to provide buyers with timely and professional resolution to their order problems. However, many sellers have expressed frustration in the past when buyers did not contact them before filing Guarantee claims, and we have made significant changes to address this concern in our new design. We emphasize specific issues sellers can resolve and encourage buyers to communicate with sellers about problems with their orders throughout the new claim submission process.”

When filing a claim buyers will now be presented all communication captured at Amazon between the seller and the buyer to show a history of the transaction. Did the seller confirm shipping? Is a tracking number available? What other updates did the seller provide (cancellation, refund)? The buyer can also add communication (such as emails) that occurred outside of Amazon to the history of the case. If the buyer has not heard from the seller, he or she will be encouraged to first contact the merchant to inquire on the status or cancel the order.

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Amazon vs. eBay Holiday Deals

Max Leisten — Tue, 13 Jan 2009 11:33:09 +0000

Ina at AuctionBytes highlighted an interesting holiday study by Jiffyprice.com that shows, for select, desirable gifts, that Amazon.com delivered a better value then eBay. While it’s a traffic-generating piece of PR for Jiffyprice, anecdotal evidence suggests that Amazon still yields higher margins if the item is generally available. If there’s a shortage then eBay tends to be place for cost-conscious shoppers with Amazon category restrictions (toys, games, video games) during the holidays somewhat limiting supply (driving prices up).

And if you were a price-insensitive consumer that “just want to get it over with”, you likely ended up at Amazon to buy from a trusted third-party merchant (and familiar shopping / checkout process) that is held to a pretty high shipping SLA (within 2 business days).

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Start an Amazon WebStore in 2009

Max Leisten — Tue, 06 Jan 2009 02:16:12 +0000

I agree with Randy’s predictions that we’re going to see a lot more smaller online retailers putting more effort behind launching their own sites and brand now that the greatest incubator, eBay, is no longer delivering the limitless opportunities and growth from prior years. One such e-commerce platform is the Amazon WebStore which leverages Amazon’s checkout and allows the over 70 million registered Amazon shoppers to use their Amazon account to pay for your products.

Next Wednesday, January 14, 10 a.m. PST, is your chance to learn more about this product directly from Amazon.

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Amazon Toy Category Reopens

Max Leisten — Tue, 06 Jan 2009 01:44:56 +0000

As expected, Amazon announced today that it has reopened the toy category to all third-party sellers. An annual ritual, Amazon closes the category starting in mid-November and only permits qualified toy retailers to sell their products on Amazon.com during the critical holiday shopping season.

Sellers that were temporarily restricted from selling on the site will need to relist their products and should review prices and quantities to make sure they’re still spot on.

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Amazon reports big Holiday 2009 business

Max Leisten — Fri, 26 Dec 2008 17:56:57 +0000

This morning Amazon reported a bigger-then-ever holiday business with some interesting statistics:

Over 6.3 million items were ordered worldwide on Dec. 15, a record-breaking 72.9 items per second
Amazon shipped to over 210 countries
Amazon shipped more than 99 percent of orders in time to meet holiday deadlines worldwide
The last Same-Day Prime order placed at 7:25 a.m. on Dec. 24 in time for Christmas delivery contained a Pinzon 400-thread-count, 100 percent Egyptian Cotton Hemstitch full sheet set, and was delivered at 6:12 p.m. to Las Vegas, Nevada on Dec. 24

How does that compare to prior years? With five fewer days this holiday season, it still smells like a good increase over 2007, but it’s hard to tell. Barclays analyst Doug Anmuth (via Seeking Alpha) recorded:

Peak items ordered on a single day

2008: 6.3M
2007: 5.4M
2006: 4.0M
2005: 3.6M
2004: 3.6M

Items ordered per second

2008: 72.9
2007: 62.5
2006: 46.3
2005: 41
2004: 32

Peak items shipped on a single day

2008: 5.6M
2007: 3.9M
2006: 3.4M
2005: 2.7M
2004: 2M+

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Managing negative feedback on Amazon.com

Max Leisten — Tue, 23 Dec 2008 00:52:41 +0000

In case you’ve not yet subscribed to the new Amazon Seller Support blog managed by the Amazon Services team, you’re missing out. In the latest post you can learn about best practices for managing not-so-good feedback, what’s okay to say and do, and what you should stay away from. I like in particular this statement that is important to take to heart when it comes to maintaining a high rating:

And if all this fails and the feedback is going to stay, I have one final piece of advice to offer: let it go. Every seller runs into this at some point or another. If you have good business practices and truly want to take care of your buyers, it will show through in the majority of your feedback. Consider it a learning experience and move on to the next sale.

Click here to subscribe to the feed via Feedburner.

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Even Amazon doesn’t like price-fixing

Max Leisten — Sun, 07 Dec 2008 16:27:43 +0000

Here’s an important no-brainer Amazon best practice: never ask other Amazon sellers to change anything about their listings, especially not the price.

Amazon recently suspended a merchant in very good standing for asking a competitor to stop adjusting his price. Even though he was reinstated pretty quickly Amazon made its point that just like in the off-line retail world price manipulation is typically against the best interest of the consumer.

Aparently I was engaging in a conspiracy to fix prices….Never ever ever ever everrrr again will I email another seller asking to stop undercutting…I haven’t done it much, but I never thought it was that big of a deal, now I certainly know better. Stupid mistake on my part. It has cost me dearly.

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