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Amazon is Going to Slaughter Your Brand

Discussion in 'General Entrepreneur Discussion' started by Almantas, Jul 19, 2017.

  1. Iammelissamoore
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    Iammelissamoore Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Just asking a question - is this what can (usually) happen whenever a company goes public? In some way, it feels as if a company goes public, it's all about a race in making money for the share holders, no longer about the customers who got them where they are?!?!
     
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  2. Eskil
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    Eskil Legendary Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    This exactly, I agree. All the "me too", arbitragers on Amazon will over time just get squeezed out, or best case - still make money - but face an never ending, race to the bottom for pricing against other "me too" arbitragers, and things lik Amazon Basics.

    And branding is one thing on its own (and no, branding is NOT just slapping your $5 Fiverr logo on your Alibaba import), but another is being different enough and adding enough new value to a product that will keep a brand that much stronger also. Independent websites (Shopify, etc) will still do well as long as they don't rely only on just flipping and repackaging Alibaba stuff like every other arbitrage entrepreneur out there.

    The best way to survive long term is, and always will be, to create/provide something that is YOURS and uniquely yours. And preferably something that is challenging for someone else to rip off. Differentiation and unique value.

    Whether you are a small or medium/big seller on Amazon, don't rely on all your products just being imported en-masse with just a logo slapped on, and "having an optimized listing". It can make good money for a while on Amazon, but never forget you are dealing with partial lack of control, a violation of one of the CENTS commandments. I always tell people the sooner you can establish your own sales channel (website) and control that, do it. Amazon should just be one of your sales channels.

    And lastly - people often tend to forget there is a world out there. Amazon is huge in the US, sure. But in other massive markets such as Europe and Asia - Amazon is small or insignificant compared to other market forces there. There is soooo much opportunity.
     
    Last edited by a moderator: Jun 7, 2018
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  3. Walter Hay
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    Walter Hay Legendary Contributor FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    I completely agree about the need to do better than simply repackaging Alibaba stuff. Too many have been doing that for too long and the Amazon "experts" are still teaching that as the way to go.

    Unique products can still be found, but few are willing to make the extra effort required, although that effort can be considerably less than re-engineering existing products, or designing something totally new. I applaud those who do both, but finding unique products should not be ignored as an option.

    As for slapping on a $5 Fiverr logo, that also is part of many e-commerce courses and does little to disguise the sameness that prevails among those who lack real marketing ability. They call it Private Labeling, but it's a poor way to differentiate. Helping overcome this problem was behind my writing of my second book about creating and sourcing labels and packaging that can help sell the product.

    Finally, anyone relying only on Amazon has all their eggs in one basket, and that basket is being shaken.

    Walter
     
    Last edited by a moderator: Jun 7, 2018
  4. million$$$smile
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    million$$$smile Platinum Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass Summit Attendee

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    That is one of the best statements in this thread.

    First and foremost, never forget that we as an Amazon seller are just a 'fulfillment center' for Amazon. They are ALL Amazons' customers and it is against their TOS to proselytize THEIR customers into buying outside of the Amazon marketplace. Anyone caught flagrantly doing this will usually find the exit without desiring to.

    For me, they are just a necessary evil on creating revenue.

    A revenue stream.

    There is just too much loss of CONTROL. I look at them strictly as a marketing medium to move multiple products faster and in larger SCALE than I could ever personally do on my own. Cheaper? I am not sure about that, but definitely larger scale coupled with the ability to sell a gamut of products that would not work on a niche website.

    But...

    I believe one better have multiple ways of marketing via their own:
    • website(s),
    • wholesale distributing if possible,
    • and even B&M sales to others
    Another aspect also is that one can usually react faster when one sees opportunities that Amazon cannot necessarily 'compete' against even though one is utilizing Amazon for the sale.

    Case in point: I market many, many different products on Amazon. I do not import directly any product I sell.

    We all hear a different drummer, though we all consider ourselves entrepreneurs.

    I have found that I can obtain products either locally manufactured or distributed (nationally distributed, but local) and acquire them within 24 hours of a fulfilled sale and not have to stock the merchandise. It can be done with inventory feeds and the like. Of course it has to be worth the time to pick up the product so there needs to be measurable sales. With enough varied products from the distribution point, one can do quite well. This works great when there are only a few available in sizes as an example because all other sellers are fearful to list the size and dropship due to the fact that they might be sold out before they were shipped. Mind you, these products sell for a minimum of $80-$150 each. We sell hundreds of the products this way monthly.

    Also, another example that we have just had approved is negotiating a price and terms on discontinued products from a national manufacturer. These product 'styles' are in the hundreds with tens of variances each, thus creating thousands of potential sales. They are taking up too much inventory space for the mfgr and so he is a 'don't wanter' These items have been sold on Amazon for years in the a very popular category. The terms were awesome, to the point that they are willing to dropship for us providing we move the product fast enough.
    So, the first option is to relist everything back on AZ (among other avenues) at a profitable discount and sell quickly, though that could very well take months as the inventory has variances. But, again not just Amazon, but contacting other companies that can utilize the product ie: better profits.

    One has to develop a relationship by starting out small, but there are LOCAL suppliers/mfgrs that if the time is spent, it can be incredibly profitable.

    Practice nimble.
     
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  5. Almantas
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    Almantas Nothing to Lose Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    After all, it's obvious that Amazon is not an e-commerce God, lol.
     
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  6. Iammelissamoore
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    Iammelissamoore Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Commandment of Control.

    In both TMF, Unscripted and countless Process/Progress Threads, we have been warned about this 'all eggs in one basket scenario.' Hopefully the businesses which will be horribly affected have prepped by diversifying, including creation of their own platform to salvage their business in some way, form or manner.

    I absolutely agree with that whole concept of buying the common alibaba stuff and repackaging - I'm not trying to knock anyone if that's their hustle; but, again, it goes against the Commandment of Entry also and when we're treading too thinly where the Commandments are concerned, we can overstand where that can lead us.
     
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  7. MiguelHammond10
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    MiguelHammond10 Contributor Read Millionaire Fastlane I've Read UNSCRIPTED

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    Amazon is getting so large, that will start disintegrating from the middle in both directions.
     
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  8. Almantas
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    Almantas Nothing to Lose Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Hi. Interesting point. Can you please elaborate?
     
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  9. acerseller
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    acerseller Contributor FASTLANE INSIDER

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    Amazon jumped into supplements in March 2017: TechCrunch-AmazonElements

    In the last 6 months the number of decent sized private label product Amazon businesses I have noticed come up for sale has been increasing (net incomes of $100K-2million). Asking price multiples have been rising at the same time.

    Makes me wonder if the insiders are getting out (worried about competition from the Chinese factories and Amazon) and the dumb money is pushing the top up.
     
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  10. Digamma
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    Digamma Gold Contributor Read Millionaire Fastlane Speedway Pass

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    If other bubbles are anything to go by, both things are happening. The jig is up, people are getting out, and fools are getting in.
     
  11. Sanj Modha
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    You need to ask yourself - what is it that my business can do that Amazon can't? It's not so obvious at first but think about it.

    Amazon is a huge so things like customer service will suffer. How can you make a difference and offer better? Also, can Amazon personalize EVERY order? No, but you can with branded packaging, a personal 'thank-you' note etc. Book stores are making a come back because they can offer an 'experience' like cosy reading spaces, coffee from Starbucks/Costa and so on.

    There's a lot of smaller things e-commerce can do so focus on that.
     
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  12. Eskil
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    Eskil Legendary Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass LEGENDARY CONTRIBUTOR Summit Attendee

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    Yes! Time and again it comes back to ADDING VALUE. Things like what @biophase is doing with his current business. Not only selling product, but also adding value, building a brand, and building a community of fans that recognizes what you are doing for it. Come up with ways to give back, educate, help or in some way shape or form be more than JUST a profit machine. One plan I have for my own main brand is to get involved with schools and colleges by providing a training kit that can get young people interested in videography/filmmaking. Amazon can't and won't ever get into that level of value creation or community support for a brand.
     
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  13. Iammelissamoore
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    Iammelissamoore Silver Contributor Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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    Absolutely agree, often times the panic can really send us crazy, but I believe this is the HUGE point a lot of us are missing and while Amazon may be doing everything now, some things in between may be overlooked which can be captured by others who see the opportunity.

    This is a H.U.G.E value-creator going beyond product/service value and definitely creating a wonderful win-win scenario.
     
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  14. Digamma
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  15. Almantas
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    Almantas Nothing to Lose Read Millionaire Fastlane I've Read UNSCRIPTED Speedway Pass

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  16. Midas
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  17. MrYoshi
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    This is somewhat worrying about someone who just started learning about e-commerce haha, but I'm glad to see that personalization and adding extra value can still differentiate you from the larger players.
     
  18. Walter Hay
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    I missed this post previously, but it sums up the value of Amazon. The question is: How do you get to that stage of no longer needing Amazon?

    The answer is simple: Build your own eCommerce site and be sure the URL appears on your labeling and packaging, and if possible it should be built into the product using a mold, or some other form of integral branding.

    EDIT: Finding other sales avenues (maybe even B2B) can also be a valuable contributor to your independence.

    Walter
     
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  19. Action Mike
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    I wouldn't worry too much, Amazon has such a large share of the online retail market they aren't going anywhere as a company, maybe parts of it shift but Amazon will be here for a while.
     
  20. Your Boy George
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  21. Laughingman21
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    Despite Amazon’s huge size and growth momentum, I think they’ll eventually start to come apart at the seams and start to shrink for any one of number of reasons:

    1. Legislation – governments hate monopolies. When they decide Amazon has got too big, governments will start pushing through legislation forcing Amazon to break apart
    2. Jeff Bezos – he’s no doubt the driving force behind Amazon. He has the entrepreneurial spirit and instinct which leads to a desire to keep growing and looking for ways to grow. Once he’s gone, they’ll lose the person with the power to make bold decisions fast and a generation of professional corporate directors will take over and keeping the share price and dividend steady and around inflation will become their target, not making the huge gains previously seen by Amazon.
    3. History – go back over time and history is littered with companies that seem too big to ever not be number 1, yet they eventually fall by the wayside. I’ve just finished reading about Sam Zemurray and United Fruits (at one point controlled 61% of bananas going into America and had so much power the CIA went to them to help out with revolutions!) yet they eventually got bought out. General Motors and Ford were huge in the 50’s and 60’s, yet they’re now struggling. In the late 90’s, Microsoft seemed unstoppable in the software market, yet they’re dropped back and other companies have come in and taken their market share. Big companies inefficiencies always bring them back to earth.
    4. Impossible to be everything well – Amazon are trying to do everything and it’s impossible to be the best at everything and build a consistent brand. Can they really compete on price for online shopping and claim to produce the best original online content for their video service? One is a low-cost no-frills brand, the other is aiming to be seen as a premium brand. You can’t have both. Eventually other companies will come in and take away areas of the business that they’re doing badly and force Amazon to concentrate on a core business.
    I’m not saying Amazon will go bust, but they will definitely fall away and a new kid on the block will come in and become the next big thing in online retail.

    I don’t think this is going to happen imminently, probably another 5-10 years or more, but it will happen. In the meantime, I think it’s possible to make money on Amazon with a good/different product, but it’d be a very risky decision to rely on Amazon only as the only sole source of income in this period. Amazon have already started tinkering with their ToS and proved to be happy to ban first and ask questions later. I definitely think the days of succeeding on Amazon by starting with a few hundred quid of stock are long gone.
     
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  22. amp0193
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  23. Sanj Modha
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    Make a list of all the things Amazon does that's sh*tty and you'll feel better instantly.

    One example is customer service - in my opinion Amazon is the worst culprit.
     
  24. mrarcher
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    Personally, I think that depending on your product. Not being on Amazon could work to your advantage.

    You could play the idea that your product is exclusive and imply scarcity.
     
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