News & Views

Opinion / Why Every Brand Needs an Amazon Strategy

by Contagious Contributor
Shane Atchison, Global CEO, Possible, on how brands can take advantage of Amazon's direct and indirect opportunities for partnerships, media and more 

If you ask anyone what they think Amazon is, they’ll tell you it’s an online retailer. And possibly they’ll tell you it’s the online retailer. While that may be true, it’s not the whole story. Amazon helps just about every kind of brand and – if you don’t have a strategy for it – you’re missing out.

Here’s why: let’s imagine you’re in the luxury scent business. Obviously, you’re not going to sell a $200 thimbleful of perfume on Above all, the site is a discounter, known for low prices and razor-thin margins. Having your products on it would be inconsistent with your brand.

But even if your brand isn’t on Amazon, your customers are.

One of the remarkable things about the company is how widely its properties are used. You’re never too rich or too thin to go on Amazon. Consumers of luxury goods may not be buying perfume on it, but they could be buying electronics, checking out camping gear, or ordering groceries through Amazon Pantry. Quite likely, they’ll be watching content on Amazon Prime or Fire TV. All this activity generates data that provides insight into your customers’ preferences for advertising, content, and context.

In other words, all brands have either direct (selling) or indirect (branding and advertising) opportunities on Amazon. It’s not an ecommerce platform, like WalMart, but an ecosystem like Google. It knows not merely what you customers buy, but also what they watch and what kinds of other activities they enjoy.

Here’s how to strategise for this:

Audit your opportunities / The first thing you want to do is to understand how your customers use the Amazon ecosystem – not merely what they purchase on it, but what they do on it. This involves everything from media properties and shopping preferences to things like Your Garage, where people list the cars they own. These opportunities can be quite rich. For video alone, you have Kindle, Fire TV, Amazon Instant Video, Amazon Shorts, Amazon Video Direct, and Twitch, a recent 1.2B acquisition that streams eSports.

Of course, every brand will have different opportunities for these properties. A perfume brand probably doesn’t care too much what people are doing on Twitch. But it might want to know if its customers are athletic or not. It would definitely want to know what kinds of content they consume on Amazon Prime. All that informs marketing strategy going forward.

Plan for data / Amazon, of course, does not reveal all of its data. But it does offer two different sources of pure insight: Amazon Retail Analytics (ARA) and Amazon Marketing Services (AMS). They tell you everything from content preferences and purchase categories to lifestyle information, such as the kinds of hobbies or activities your customers like to do. In other words, they highlight the orthogonal interests your customers have. Any Amazon strategy should state how that data will be used and shared throughout your company.

Strategize for media / Amazon should also be a part of your media strategy; use Amazon data and adtech to target users both on and off of its platforms. Some brands will want to advertise within the platform to drive purchases today. Others may target the Kindle lock screen, which offers one of the few uninterrupted spaces for digital advertising today. And still more will want to use the customer data Amazon generates to target people off platform.

Understand the significance of search and reviews. If you do sell on Amazon, its importance cannot be overestimated. Thirty-nine percent of online shoppers start product searches online. Moreover, the majority of Amazon searches eventually result in a purchase. And thus, paying attention to your product reviews is critical; 90% of online shoppers read and are influenced by product reviews. Amazon is by far the biggest forum for them online.

See the broader implications / The strategic challenge – and why you need a full strategy for Amazon – is that it does not structure its ecosystem like your business. For example, an Amazon product page is comprised of elements driven by three different Amazon systems: retail, merchandising, and paid media. How the consumer landed on that page (Amazon search) is run by another Amazon business unit. Most brands, however, do not have all of these functions in the same room. Search and merchandising typically belong to different teams with different objectives, not to mention budgets. Yet, an Amazon strategy requires all of them to work together for maximum effect. So you’ll need to form a working group to find ways your organisation shares data so that it can optimise its opportunities.

Look for partnerships / Here’s where you can get creative. By now, you probably know that Amazon Echo has a partnership with 1-800 Flowers to make it easy for you to order some new blooms. However you may not know that Mountain Dew has partnered with Twitch for live-event streams. Many of Amazon’s media properties provide interesting opportunities for brands today.

In other words, the sooner brands start looking at Amazon strategically, the better they will be able to compete with more agile, digitally-native challengers, and the easier it will ultimately be to stay in step with what Amazon will look like tomorrow.