Possibly the most common problem we see with direct-to-consumer problems is this: Brand A has been seeing steady year-over-year growth for some time, and is working with Amazon - usually with their own Amazon store - but now sales growth on their own site has gone flat or negative, while business on Amazon seems to be healthy. The result is that overall growth has stalled and the brand is now trying to figure out how to rekindle that fire.
But here's the problem: They're now dependent on Amazon, while actively competing against the world's largest retailer simultaneously. They may depend on Amazon for shipping and order fulfillment, and in doing they've created a monster: 75% of US consumers - about 180 million people - have a Prime membership, making it economically sensible to buy goods from Amazon if they're priced the same as they are on the brand site, since it usually means they'll get free, faster shipping.
The biggest problem here is that Amazon provides volume, but it doesn't provide value: While it makes the brand easier to find and buy from, driving more sales and helping spur growth, it does so in a closed environment, where access to those customers is closely guarded. You can get some of this data now - primarily email addresses - by cultivating followers for your brand store, but the rich data you'd get from browsing your site - product interest, abandoned carts, purchase habits - is lost. The result is that the brand cannot build meaningful relationships with its customers, cannot understand and build Customer Lifetime Value, and cannot leverage its customer data for prospecting and retargeting.
Solving the Amazon Problem
All of this leads to the same request: "We need to increase sales, but without rocking the boat on Amazon." It's a funny ask, given that Amazon has been cannibalizing their site sales to this point, but there are ways to grow without losing out on Amazon sales. The brand website is they key to this - the brand cannot win long-term without growing its own customer base, and that means training customers to buy directly. Direct sales provide both higher margin and direct access to the customer and their data, and should be considered to be somewhere around 2x more valuable on average than an Amazon sale (though this will depend on margins and data collection strategies).
Let's talk about a few way to bring customers in to buy direct:
Timed deals and events. You can train customers to return for regular purchases with timed events and sales - a strategy which can be effective even when the product itself isn't consumable (see: Victoria's Secret and their semi-annual sales). By training customers to shop at specific times to score better deals, you're also training them to return to your site at specific times, creating easy windows for cross- and upsell opportunities.
Competitive pricing. You're going to have to compete with Amazon on price, as everything about the modern internet is geared toward driving consumers to sales on Amazon - and if your site doesn't have the cheapest price for something, chances are the link will get buried. The good news is that not paying a percentage to Amazon for sales means you can offer lower prices to customers buying direct. You need to take advantage of that to incentivize customers to shop direct.
Product control. You can restrict the quantity of products available on Amazon, and avoid putting their entire catalog up for sale on the site. Instead, you can focus on showcasing products for which you sell adjacent or connected products - parts of a set, or items commonly sold together. Or you can sell bundles on Amazon, but only sell individual products on your brand site. This can create interest among Amazon customers for the other, connected products you sell, or for the individual products, and you can direct customers back to your site to grab those individual pieces. Your paid media strategy can also focus on site-exclusive products, so even existing customers may be enticed by images of a product they didn't realize was part of your catalog.
Packaging. While it's against Amazon's policies to direct customers to your site directly with packaging, you can still include inserts directing your customers to additional content on your site. Amazon tends to be pretty strict about what you can do with this as they don't want you diverting sales away from their platform, so be sure to check the most up-to-date policy for what's acceptable with your packaging, but creating memorable packaging with your brand name, website, and social accounts (so long as you don't have explicit messaging directing consumers to your site) is generally OK.
Prospecting for New Customers
Last time around we talked about the direct-to-consumer brand advertising lifecycle, and how brands end up starting in paid search and social before branching into other channels. Amazon is part of that process, and brands relying heavily on Amazon for sales will often end up spending on Amazon for advertising - and usually finding little value in either search or the brand's DSP. Why? Because often these brands were already tapping out on the Amazon ecosystem and needed to find buyers in other spaces.
That's where programmatic media can help bridge the gap, giving you access to the entirety of the open web with massive amounts of data for targeting. You can use your existing site visitors' data to build campaign strategies for prospecting that will find net new customers, who can then be brought back to the site via aggressive remarketing. In particular, you strategy should include the following tactics:
A retargeting pool of customers who have lapsed and not made purchases within a specific number of days (this will depend on the product category)
Lookalike models based off net new customers and retargeting pools to fill the sales funnel
A retargeting tactic focused on net new customers - this can be done a number of ways, from using site pixels to excluding existing customers in your CRM database
A plan for incremental sales measurement, to make sure you're properly driving new customers and sales and attributing those sales correctly
A plan for measuring and optimizing against Customer Lifetime Value, tracking repeat visits and purchases
Ultimately, this is a tough challenge - going up against Goliath is never easy - but with the right strategies in place you can ensure that you're taking your best shot at growth. In 2024 success without Amazon isn't really an option but the most successful brands will have to find ways to stand on their own and create programs for turning Amazon buyers into dedicated brand loyalists.
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