Raj Sappu, General Manager, Netrush

In many ways, 2020 was the year of the Amazon FBC. According to some estimates, investors have spent $ 1 billion on small businesses that can be set up using Amazon (FBA) services. One of them, Tracy, even won a union status worth over $ 1 billion.

None of these bodies are public companies, so no one knows exactly how these agreements will be implemented. But even if the details remain in the dark, the beneficial effects of the markets are clear in the marketplace.

For one thing, collectors encourage entrepreneurship. Before they arrive, sellers can only see their own profits as a reward. Often they were building living rooms and garages, which led to natural disabilities that limited their ability to grow. Now, collectors are rewarding their efforts and giving them a chance to try something new.

Collectors provide bridges for better things along the way. Today, most of the offers are very small, with companies with less than $ 1 million a year earning for FMSG giants such as P&G or Unilever. Collectors can bring the marketing and operational expertise needed to help them build supply chains, exchange product portfolios, and ultimately make them attractive to large companies.

Still, collectors face many challenges that are not appreciated. As acquisition costs grow, they must quickly build sustainable, long-term businesses around a wide variety of brands. In addition, many e-commerce companies are led by experienced investors who rely on outside experts to measure their profits. They must have at least four things in order to be successful.

  • Avoid short-term feelings; Small business owners often focus on their products at the door, which leaves them with high customer acquisition costs and limits their ability to expand their product lines. Collectors need to encourage long-term investments in dance and customer experience. These efforts should include information-based product innovation to increase loyalty and provide customers with more options.
  • Expand fingerprint: Most of these small products rely solely on Amazon to deliver their products to customers. While this successful strategy has recently been proven, it does contain some risks and limits the customer base. Collectors need to find ways to expand their brand footprint to Walmart, Target or even to platforms directly to their own consumer platforms. In doing so, it is important to be proactive in making sure that they are fully competing with the existing products on the platform before they enter.
  • Expand the destination; Small companies rely solely on search advertising on Amazon to attract new customers. Collectors have a rich chance of expanding that reach by accessing targeted ads, such as Google, Facebook, or other social media assets. You can then drive traffic to Amazon or wherever you make the most profitable sales.
  • Continue the lesson; It’s easy to break things that already work after you buy them. Nowadays, small business owners are developing a great deal of creativity in the use of social media and tools in the Amazon marketplace. Collectors have a lot to offer, but they should not neglect the special soup that these brands are delivering. Doing the same thing over and over again is the right way to go.

In general, collectors provide welcome oxygen to the Amazon marketplace, but they should not neglect the hard work it takes to grow small brands into major players. They start from scratch and measure their new purchases from the usual audience to the main audience. They have recruited the right talent for many. Others need to find partners to help bridge the gap between their limited experience and their high aspirations.

At this point, it is not clear how well these companies and investment companies are doing, but we can acknowledge the great challenges and opportunities they have.

Helps Netrush brands sell on Amazon and other online marketplaces.