5 Tactics for Brands to Reduce the Impact of Third-Party Sellers
Third-party sellers have long been a thorn in the side of brands across nearly every product category, and as long as Amazon continues to merge its seller’s marketplace with Amazon Retail, that will likely be the case.
Whether it’s retailers who procure a product legitimately or independent sellers who grabbed a box that fell off a truck, just about anyone is free to sell an item on Amazon.
And with the price control Amazon provides its sellers, these third parties can very frequently cause headaches for brands in the form of reduced margins, fewer sales for the manufacturer, and poor brand consistency.
However, while there’s almost nothing a brand can do to completely eradicate third-party sellers from offering its products on Amazon, there are tactics to significantly reduce their impact.
Let’s review a few:
1) Merge Duplicate Listings
In a competitive environment where there may be dozens of sellers of a particular product, third-party merchants frequently will create new listings for an identical item simply to avoid having to compete for the Buy Box.
It’s deceitful practice, but it works. It’s very common to see a duplicate listing charging a much higher price for a product – and getting sales! This is simply because the average Amazon consumer seldom has knowledge of how the marketplace operates and logically assumes the listing they visit is the product’s one and only.
Merging duplicate listings not only prevents this Buy Box-dodging, but also will increase the strength of the official listing by combining the sales velocity and reviews from all merged ASINs.
2) Offer What They’re Offering
Another common practice for third parties is simply to create varieties of a product not offered or sold by the brand on Amazon. For example, a light bulb manufacturer may sell a 2-pack and 12-pack, but if a third party creates and offers a 6-pack, it’s technically a different product for which they don’t have to compete against Amazon Retail for the Buy Box.
Not every company has the ability to create new product varieties at will, but for those that do (or those that can without a serious amount of legwork), creating multipacks and variety packs to match third-party offerings can go a long way in minimizing their impact.
3) Focus on New Products
It’s reasonable to assume the longer a product has been in the market the more time third parties have had to procure it and post it for sale on Amazon. Many brands, especially those where there are annual or seasonal product updates or lines (fashion and electronics, for example), choose to focus their time and attention on new products largely because the third-party competition is considerably smaller.
4) Watch for Term Violations
While Amazon is mostly laissez-faire about its open marketplace (where anyone can sell just about any product), they’re far more likely to take action when it comes to sellers violating the site’s terms and conditions – and certainly the law.
There are instances of third parties using brand names within their own storefront titles, and selling expired or even counterfeit items. In this instance, it’s worth the outreach to Amazon to get the seller booted from the listing, or from Amazon completely.
5) If They’re a Known Retail Partner, Simply Tell them to Stop
It’s a bit strange that retailers and distributors reselling a brand’s products on Amazon became accepted practice. Certainly, there’s no standard of business ethics that dictates the merchants of your product have the inherent right to sell your products through other
Amazon is – and should be viewed as – a major retailer on the same level as a brand’s most important accounts. And just as you wouldn’t be keen on one of your retailers wheeling a palette of your products and hocking them in front of a Wal-Mart, there’s no reason to allow retailers to lower your margins by taking a cut of what’s sold through Amazon.