Hacks
Nov 20, 201811 min read

Amazon-proof your webshop: Will you win or lose?

Kristian Borglund headshot

by Kristian Borglund

More consumers than ever are using Amazon as their go-to place for shopping, and that trend is accelerating. Should you be worried or excited? This test reveals if you are on a losing or winning track – and, if it looks bad, what you can do to survive.

Amazon is crushing it, as we all know. In the US, when shoppers were asked the question “Where do you typically start when searching for a product online?”, this is how they answered back in 2014:

“Search engines” – 55 percent.
“Amazon” – 38 percent.

Two years later, in 2016, the same question was asked, but with quite different results:

“Search engines” – 30 percent.
“Amazon” – 60 percent.

 

As you can tell, when people want to buy something they think of Amazon, and go straight there. Google search and Adwords are becoming increasingly irrelevant. Will this new behavior help your business, or is it a threat? Well, that depends, of course – and we’ll come back to this in a minute. Remember, those numbers are from the US where Amazon swallows an impressive 44 percent of all money spent in e-commerce (2017). However, it’s not just in the US where Amazon is influencing markets big time.

 

The Amazon effect in Europe so far

If you are in the e-commerce market in Europe, you have probably felt the earth move in one way or the other. In England, where more than 33 percent of online sales now happen on Amazon, the giant is innovating new ways to serve customers – for example by giving them the option to pick up their orders in the subway. In Germany, Amazon has become the biggest online player, and plans to open physical stores to grow even more. The company has opened local webshops in Spain, Italy and France. The domain amazon.se still points to amazon.de, while others – like amazon.fi,amazon.no and amazon.dk – are still empty (June 2018).

 

As Amazon is attracting customers with a magnetic force, it is also investing billions in innovation across all levels of the business (16 billion dollars in research & development alone in 2017, to be precise). But while Amazon is forever expanding its product range and raising the bar when it comes to shipping, the ease of shopping and everything else… what is happening to your business?

 

Ready to test your business?

The test below functions as an eye-opener and a stimulator for thoughts rather than an attempt to give you The Answer for your business future. There are so many variables playing into how Amazon affects your business, and the future is unknown after all, so take it for what it’s worth.

E-commerce expert Jonte Bergman adds his comments along the way to offer further insights. He’s the CEO and founder of Wikinggruppen, one of Sweden’s biggest e-commerce providers. Approximately 1,200 entrepreneurs use this Klarna-native-partner platform.

 

INSTRUCTIONS: Answer the questions, and total your points. The more points you get, the better the odds you have of placing yourself in the winning lane ahead.

 

Do you have an e-commerce business up and running today?

  • Yes – 20 points.
  • No – 0 points.
  • Soon – 10 points.

Comment from Jonte Bergman, Wikinggruppen: “One of the greatest impacts Amazon has had is to speed up the digital transformation of retail. The more consumers get used to buying online, the better for you – provided you are doing business online, that is.”

 

Do you have your eyes on what Amazon is doing?

  • Yes, I study them closely – 5 points.
  • Well, I’ve seen what they are doing – 2 points.
  • Not really – 0 points.

Comment: “Amazon is continually raising the bar for shopping online at almost every level; prices, easy payments, fast and convenient delivery, and so on. As an e-commerce entrepreneur you must be on your toes to adapt to the growing consumer expectations have of webshops.”

 

Do you have your own niche product that consumers in other countries would buy if it showed up in an Amazon search?

  • Yes – 30 points.
  • No, but I can create one – 15 points.
  • No – 0 points.

Comment: “Amazon Marketplace is an opportunity for you to reach out to the world. If you already sell your own branded products in your own store, you can splinter off a few specific products and make them available on Amazon as a way for consumers to discover you. You use your own webshop for margins and customer relationships, while Amazon becomes a marketing channel – and logistics partner as well if you want to use its fulfillment and delivery opportunities.”

 

Do you sell mainstream products and compete on price?

  • Yes – 0 points.
  • No – 20 points.

Comment: “Amazon optimises every part of its process so effectively and sells high volumes. If you sell things like electronics, books or toys you’ll have a hard time competing on price.”

 

Do you sell a unique product or experience that can’t be easily be sold by Amazon or by someone else using Amazon Marketplace?

  • Yes – 20 points.
  • No – 0 points.

Comment: “Given the choice between buying a product from your store and buying the exact same thing from Amazon, most consumers will choose Amazon. One way to stand out is to provide customized products, not just by color and size, but more personalized – for instance by letting customers add their name. Think about ways to provide personalization or offer influence over how the product is made.”

 

Do you have customer reviews for your products in your webshop?

  • Yes – 10 points.
  • No, I don’t think it’s necessary  – 0 points.
  • No, but it’s coming up soon – 5 points.

Comment: “This is one of Amazon’s trademarks, and it has been since the company launched in the 90’s. As more consumers are getting used to reviews, they’ll expect them in your webshop too.”

 

Do your products come with something extra that customers enjoy or need?

  • Yes – 15 points.
  • No – 0 points.
  • No, but I can certainly add that from now on – 5 points.

Comment: “If you sell a kind of product that also can be found on Amazon, you can still stand out by bringing something extra to the product. One of our customers in the DIY business provides a library of instruction movies to help its consumers succeed. You can also add services, packages, guarantees and things like that to stand out.”

 

Is SEO and Google Adwords your main marketing strategy?

  • Yes, and we’ll stick with that for now – 2 points.
  • No, we use a couple of others too – 5 points.
  • Well, we pay attention to the changes in our market then test and adopt new ways to attract our customers – 10 points.

Comment: “If SEO and Google Adwords still is working for you, that’s great. But are you aware of the shift that is happening where customers bypass Google and go directly to Amazon? If you sell on your own site, you’ll need to explore new marketing strategies to have consumers think about you first – and choose you.”

 

Do your customers buy because it’s you?

  • Yes – 50 points.
  • No – 0 points.

Comment: “A strong brand is gold, no matter if you sell just in your own store, or via Amazon, or via other partners. Even if consumers know they could buy something similar from someone else, they will still walk that extra mile to buy your product. Apple is a good example of this.”

 

Are you investing in faster and customer-friendlier delivery?

  • Yes – 10 points.
  • No – 0 points.
  • It’s on my list – 5 points.

Comment: “As I said before, customer expectations are getting higher as a result of Amazon, so if you don’t keep up you are likely to lose business.”

 

Do you have a popular loyalty or subscription program for your customers?

  • Yes – 10 points.
  • No – 0 points.

Comment: “Amazon Prime is a way of building loyalty through a subscription model. The $12.99 per month membership gives free and fast delivery, deliveries on Sundays, free streaming of movies and TV series, and exclusive invites to sales. Its benefits lead to customers becoming more attached to the brand. Could you do the same, adding some kind of membership or loyalty program that gives appealing benefits related to what you sell?”

 

Do you use data to personalise what products are displayed in your webshop?

  • Yes – 15 points.
  • No – 0 points.
  • A little bit – 5 points.

Comment: “Amazon is a master of personalizing the shopping experience based on the customer profile, previous purchases, and so on. And more and more business are following their example. If you don’t personalize at all, the shopping experience won’t draw the customer in as effectively.”

 

That’s it. How many points did you get?

The more, the better.

If you have entrepreneurial friends, ask them to take the test as well to find out who is the most Amazon-proofed. Just for the fun of it.

 

Additional source used in this article: The April 2018 report “Vad händer när Amazon kommer?” (“What happens when Amazon launches?”) by HUI Research.