Maximize Online Sales through Well-Planned Diversification

Maximize Online SalesIt is just a simple truth that Amazon ranks as the top online marketplace. If you doubt it, just consider this – Amazon has quickly become the main place consumers go in order to shop online. In fact, many reports show that Amazon is even beating out Google in terms of product searches! Because of its popularity and growing share of product searches, it’s hard to argue with merchants for flocking to the online channel to sell their goods.

Pretty hard, indeed, and yet there are many firms that are eager to shift their business model away from an Amazon-centric model. Why? There are actually many reasons for it, and yet there is also a single, universal truth often overlooked when discussing the pros and cons of reliance on Amazon. What is that universal truth? That failure to diversify is a poor model for sales of any kind. It is the opposite of “hedging your bets”, and in this article, we are going to look at ways of maximizing your sales on multiple sales channels, rather than strictly through Amazon.

Why Not Just Stick to Amazon?

With its immense access to consumers, its ease of use for you and your buyers and its phenomenal infrastructure, it makes sense to use Amazon. Yet, there are several serious “cons” to this narrow avenue for sales. Let’s consider the most substantial:

  • Absence of buyer demographics – The metrics that can help you create an optimal marketing and sales model are unavailable when you use the Amazon system. Tracking, metrics, and invaluable insight are severely limited, preventing you from making the most out of any sale.
  • Amazon owns buyer demographics – Of course, a major reason to rely only mildly on Amazon is that they retain the contact information on each of your sales. This means they position themselves to become your competition if they can source the product less expensively and use their massive distribution network to undercut on shipping, too.
  • Competition is intense – It is not only Amazon that forms the competition, and instead of building a brand, telling your story and solving a need, it comes down to the lowest price. It can also come down to selling a specific brand over another.
  • High fees – No matter how you approach it, experts warn that keeping on top of your Amazon selling fees is the starting point to running a successful business on Amazon. After all, there are often per item fees, referral fees (usually 15% of the sale price or $1-$2 per item), closing fees and even selling plan fees. This can add up and leave you non-competitive. Not only are the commissions high, but if you use Amazon FBA you’ll be paying more than if you use most fulfillment companies, according to FulfillmentCompanies.net’s analysis of fulfillment pricing.

These are but a few of the downsides to leaning too heavily on Amazon, and yet there is one final downside that we’ve already touched on – the absence of diversification. In fact, some warn that many sellers end up experiencing dependency upon Amazon. In doing so, they might enjoy ongoing sales, but this prevents long-term brand development as well as allowing most other e-commerce activities or online efforts fall to the proverbial wayside. The best way to build your own brand is to diversify, or at least diversify your business from your activities on Amazon.

Maximize Online Sales  with a Model for Basic Business Diversification

Though you may have started your online sales career through Amazon, you must strive to create a brand of your own, that enables you to control client data. This can only occur when you take the first, essential step towards diversification, which is to build the foundation of an online profile using an independent website.

  1. Create a website – You can have an Amazon sales page that includes feedback, policies and product listings, but it is nothing like a free-standing website. With this you can track user data, refine your marketing, harvest email information, link to blogs and social channels, link to other marketplaces, and learn all you need in order to succeed at SEO and sales. Without this foundational piece, you are just at the mercy of the Amazon marketplace.
  2. Social channels – Marketing via Facebook, Instagram, Pinterest, and even Etsy (which is also a marketplace of its own), is a simple and affordable way to direct traffic to your site. If, from your site, you want to steer visitors towards Amazon, or other channels, that’s fine, but this lets you control the direction of the traffic. Often it allows you to steer visitors to landing pages or list building pages.
  3. Other Marketplaces – You should not limit yourself to Amazon alone. Global audiences, or at least quite massive audiences, exist on eBay, Walmart and Jet.com, among others. Do the same storefront activities there, with pricing designed to compete with those in the same marketplaces. This lets you adjust pricing, get your brand or name out there, but steers you away from Amazon dependency.
  4. Partnerships – No matter what you sell, it is likely that there are firms with products that complement or partner nicely with yours. Forming partnerships with them can help diversify and extend your reach. This can be everything from vlogs with product placements, blogs and articles that offer links back to your site, sales pages you create together and which packages your offers or promotes them equally, and more.

While it is oh-so-easy to get started in sales on a site like Amazon, and make money, why bog yourself down into this single, narrow channel that will only have diminishing profits over time? Diversification is affordable and easy using the steps outlined above. It is the only real path to growth and one you can get started on right away.

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