54% of people looking for a product go directly to Amazon. That’s not good for nearly anyone in our industry. Amazon takes a 30% cut and keeps all the customer’s contact information (email, tel, address). If you’re a retailer, you can’t operate a successful business giving away 30% of your 50% cut of a retail sale.
If you’re a brand, over the last few year you were probably relishing in selling direct, cutting out the rep commission, and getting 100% of the sale. Well now Amazon is your new retailer and rep and it’s going to take 30% and make you work for it. Amazon puts about nine ads for competing products on your page on Amazon. In this way, you have to constantly keep prices low and manage your page in order to not lose a sale. And you have to buy ads from Amazon. Amazon has you competing in a death match with your competitors. And who wins? The king who watches: Amazon.
If you’re a rep and opened an Amazon selling account, you thought you found some new revenue. Short term? Yes. Long term you took the muffler off your car and removed the catalytic converter. In the near future, you will wonder why there is global warming. Look in the mirror. You’ve helped turn your other stores into showrooms and thereby undermined them. You figure no one will notice. That’s just what each polluters think. Maybe you figure you gotta get yours before you retire and or someone else gets it.
Do you have kids? Have employees you wish pay a decent wage? You’ll have less money for these things when our industry is run by Amazon.
I’d highly recommend collaborating with other members of the industry to protect your business and livelihood now before it’s too late.
For those of you out there who still think old retail is alive and doing fine, please keep in mind that Neiman Marcus has $4b in debt and may go bankrupt. Traditional retailers have too much debt and showed up to the war with horses. Amazon has tanks and momentum. What happens when the current trend continues and 75% of shoppers start on Amazon? It’s time for the Allies to team up.
100% of our lives depend on what we get that 54% to do next.