Amazon is the dominant force in ecommerce, and its sales continue to grow strongly. The popularity of Amazon with consumers, and increasingly with business buyers, makes selling on the Amazon marketplace a huge opportunity for any brand.
Thousands of brands have recognized that opportunity, and worked to build Amazon into their business model. Many of those brands, however, have been quickly frustrated by the challenges of selling there. Instead of a sales bonanza, they were left disappointed by weak volumes, low profit margins, and the heavy workload needed to manage the Amazon channel.
Not only that, brands selling on Amazon often suffer MAP price violations, conflict with other sales channels, and a loss of brand control overall.
Yet Amazon remains a sales platform with huge potential for almost every brand. It’s just that benefiting from it takes a lot of Amazon experience, know-how and capabilities. Amazon is slow and difficult to learn, it’s always changing, and mistakes can be expensive. Even innocent oversights can freeze your sales for months.
This is where Omni-Channel Distribution (OCD) comes in. They are an experienced and highly-rated third-party Amazon seller, working primarily (but not exclusively) with OEM technology brands to help them sell more successfully on Amazon. Brands can increase their sales through Amazon, while protecting their reputation and pricing, but without the steep learning curve and additional burden of managing the sales themselves.
The challenges of selling on Amazon for brands
Amazon wasn’t created to make life easy for brands. It was created to provide a vast selection of products, with multiple sellers competing on price, giving their customers the maximum choice and the lowest prices. There are many ways in which this model is at odds with the interests of brands.
The first is that because it is easy to join the Amazon marketplace, it is common to see unknown and unauthorized sellers offering your brand’s products. These sellers can provide incorrect listing information, potentially leading to a loss of brand control, misleading content and poor customer service. When customers purchase an unsuitable product, the result is often negative reviews, poor search rankings, buyer confusion and ultimately damage to your brand.
Hand-in-hand with that are MAP (minimum advertised price) violations, leading to complaints from existing retailers that their showrooms and product expertise are being used as free advice by customers with no intention of buying from them.
There are also the technical challenges of running your own Amazon selling account. Navigating PPC campaigns has become increasingly complex, requiring an entire skill set of its own. There are financial challenges, such as accounting reconciliations for manufacturers.
Creative challenges arise in producing optimized listings and A+ content. And of course, there are logistical challenges in fulfillment and inventory, such as the pressure to use FBA to secure the Prime badge instead of your existing shipping infrastructure. So what’s a brand to do?
What options do brands have for selling on Amazon successfully?
Brands need an Amazon strategy. Ignoring it does not prevent your brand from being sold there. As many companies have found, your products will find their way to Amazon anyway, through gray imports or careless domestic distributors.
This leaves several options. A brand could sell directly to Amazon as a vendor, but with a substantial loss of control over their content and pricing. Amazon is known for aggressively squeezing margins, ignoring MAP, and demanding various marketing contributions and recharges.
They could try to sell on Amazon themselves by creating their own seller account, but for a typical OEM manufacturer, that’s like starting an entirely new business. The Amazon marketplace is a retail platform, not a wholesale one, and a unique ecosystem in its own right. Those who don’t understand the lingo, fulfillment solutions, accounting, and marketing find it an expensive and time-consuming proposition to take on.
Another option is to find a trusted third-party seller who already has the skills to sell on Amazon successfully, and you can trust to handle your brand respectfully. That means following MAP rules, using high-quality images and content, maintaining stock levels, and providing excellent customer service. This is the model that OCD follows under its Amazon Marketplace Management program.
Interestingly, OCD also advocates for a hybrid approach, where a brand allocates certain SKUs to its third-party partner and also sells some directly. This allows the OEM not to place all its eggs in one basket; and to take time in determining the best approach for the brand.
What is OCD Amazon Marketplace Management?
OCD is an experienced and highly-rated third-party reseller, working with established small to midsize brands in electronics and other categories, to help them sell their products on Amazon. Some brands who come to OCD are already selling on Amazon, while others are yet to join the marketplace. By working with OCD, brands can maintain control over pricing and how their products are presented, but without the hassle and expense of becoming proficient on Amazon themselves, or of maintaining an Amazon account.
This is done through OCD’s Amazon Marketplace Management program, a managed service that’s a cross between outsourcing and a partnership. OCD simplifies the complex and ever-changing Amazon ecosystem for their manufacturer partners, providing all the services to represent their products and grow sales on Amazon. This includes all creative and advertising work, customer service, brand protection, product sales, analysis and reporting.
OCD operates as a partner to tech brands, placing purchase orders and taking stock positions on the products being offered. They manage all aspects of logistics from inventory forecasting (making sure SKUs are never out of stock) to fast shipping to customers, leveraging both Fulfillment by Amazon (FBA) and Seller Fulfilled Prime (SFP).
Products are purchased directly from the brand (or their authorized distributors) by OCD at an agreed-upon fair price, then sold on Amazon either under a dedicated brand account or one of OCD’s existing storefronts. There are no additional fees or costs to the brand. Brands work with a dedicated account manager using OCD’s proprietary “Optix” platform to optimize pricing, marketing, logistics, and strategy as shown here:
How does OCD’s service benefit brands?
OCD’s service is designed to increase visibility, profitability, and speed. OCD is focused on SKUs – increasing their velocity, while always keeping the products in stock.
For brands, a major benefit is transparency. Reports are generated on a daily, weekly, and monthly basis, and are more thorough than those available from Amazon. Larger product orders are placed regularly, rather than having to deal with small weekly orders from Amazon.
Brands can expect more attention and brand control, higher profitability per SKU, and higher sales. OCD will never sell below MAP or demand lower wholesale prices, as is often the case when selling directly to Amazon.
Through its legal partners, OCD will work to protect the channel and remove sellers from the marketplace that are hurting the brand. This is through a combination of account management, their proprietary Optix technology platform and a range of supporting services.
OCD is able to get products available quickly on Amazon with the Prime badge – through its enrollment in Seller Fulfilled Prime (SFP). This is a difficult program to qualify for, and to retain its high performance standards, but has the huge advantage of adding the Prime badge to listings without using Amazon’s fulfillment services. FBA has experienced long delays both in inbound processing and outbound shipping during the current pandemic, but sellers with SFP are unaffected by this.
Why should companies trust OCD with their brand?
OCD, headquartered in Costa Mesa, California, has over 14 years of experience as a tech product distributor and reseller, and is a top 50 Amazon marketplace merchant. They have a deep understanding of how to sell successfully on Amazon while addressing the needs of brands and working within the ever-changing rules of the Amazon Marketplace.
On a practical level, OCD offers a risk-free trial, where a brand can choose a few SKUs to sell with them. OCD issues a purchase order, adds the selected SKUs to their store, and goes to work. Throughout the trial, OCD communicates regularly with the brand, updating them on sales, search ranking and competitive information. At the end of the trial period, the brand can add more SKUs to the OCD portfolio or end the program as they see fit.
OCD’s customers include leading technology brands from around the world, including BenQ, Cooler Master, Tamron and Lenovo. As well as selling on Amazon, they are an integrated sourcing partner for Ingram Micro and Tech Data and offer a range of distribution services for tech brands, including end-of-life and B-stock, and even refurbished products.
What happens after signing up with OCD to sell your brand?
Once a brand engages with OCD, the first step is a comprehensive audit of their products – and their listings if they are currently selling on Amazon. Understanding the products, evaluating any existing listing content, and designing a pricing scheme that would result in higher profits are key to this process.
OCD works closely with the brand to hone in on a group of SKUs that need the most attention. These are the first batch to be transitioned to OCD. Additional research is done, pricing is set, and daily reporting begins. Communication continues, reports are generated regularly, and monthly business reviews are held.
When the brand is ready, the next group of SKUs is selected and transitioned to OCD, until all the SKUs the brand wants to sell on Amazon have been processed.
Amazon sales without the Amazon headaches
There’s often a misconception that brands have just two options for selling on Amazon:
- Establishing their own marketplace operation, or
- Selling directly to Amazon.
The reality is that for many brands, they can save time and money and have much more control without doing either of those.
By finding a trusted and experienced third-party reseller partner, a brand can leave the nitty-gritty of Amazon selling to a company that has been doing it successfully for years. The brand can stay focused on what it does best – creating great products – and outsource their Amazon sales to a partner who understands and respects their brand.
OCD does just that. Brands have as much access and say in the partnership as they want, and get much more personalized attention than they ever would from Amazon, while OCD does all the heavy lifting.
If you’re a brand manufacturer in tech or any other category, looking to increase your visibility, profitability, and velocity on Amazon, Omni-Channel Distribution’s service may be just what you need.
This article was sponsored by Omni-Channel Distribution.