TIMOTHY SCOTT BURNS - With 15 years of experience in the toy and hobby industry, holding senior leadership roles at Edmund Scientific, X-treme Geek and Poolsupplies.com, Tim launched thousands of new products across multiple digital and traditional platforms. This includes Amazon businesses that generated eight figure revenue streams. Through his own agency, South Pole Digital, he now advises clients on ecommerce strategy, digital marketing and marketplace sales execution (Amazon, eBay, Walmart.com). Tim is a frequent speaker on marketplaces at ecommerce and direct marketing conferences in the USA, and is the author of a soon to be published book, Selling on Amazon – Strategy and Tactics that Help You Succeed a beginner’s guide to understanding the basic concepts of selling on Amazon, and how to succeed there.
He can be reached at email@example.com
"I Want to Sell More Toys on Amazon – Can I Sell TO Amazon AND ON Amazon? Can I Do Both?" I get asked this question often. And it’s a good one I think. For businesses selling on Amazon using Vendor Express or Vendor Central as their primary method, I believe that it makes sense to consider a Third-Party Seller account, in addition to the Vendor tools. I think the most successful sellers on the Amazon Marketplace, are those who employ a hybrid strategy to sell their products.
But first, consider this as a strategic question about your business and who you want to be. I think business has grown increasingly complex over the last few years. As a consultant (like me), and as a CEO (maybe you?) it is increasingly important to asses and understand the business, not as individual sales channels or customers, but as a whole.
In today’s marketplace, there are lots of different ways to sell your products, but I see most toy companies sell stuff in two ways: Business-to-Business (B2B), or single unit, and/or small order sales directly to the consumer (B2C). Wholesale or retail, is how it’s been laid out traditionally. With regards to Amazon, you choose Vendor Express/Vendor Central (B2B) or Seller Central (B2C).
A lot of new toy companies are ignoring the whole B2B piece described above, and jumping right into B2C, via Amazon. Other, more established players are creating ‘Amazon Only’ extensions to their toy lines, and selling them via programs like Amazon Launchpad. Both strategies work. But it doesn’t have to be one, or the other. I think a hybrid strategy, selling both on Amazon as a merchant, and to Amazon as a vendor makes a lot of sense.
Advantages of Third Party Selling
There are several different advantages to third party selling on Amazon. The first and usually the most important advantage, is the additional control over the products, and most importantly the price of the products listed on Amazon. This also means that you have more control over how your products appear on the marketplace (images, copy, videos, etc.). When you sell to Amazon as vendor, it’s their price, their promotions, their inventory planning. You give up this control for the perceived “ease of doing business,” when selling directly too Amazon via Vendor Central.
Selling as a merchant via Seller Central you are also skipping the middle man and selling directly to your customers. This also means that you are more connected to your customers. If there is a problem or if the customer has a question, they can come directly to you and not to Amazon, who will never know as much about the product as you do.
Bottom line here: Selling individual units directly to consumers is different than cases and skids to a B2B customer. It’s hard work. But the margins are better, and usually significantly better. You do more, but the rewards are worth the challenges. As a Vendor of Amazon, you wait on a big purchase order, ship a pile of items and wait to get paid.
What about Launching New Products?
If you are only selling your products to Amazon and you are trying to launch a new product, you are going to have a hard time. The reason is because Amazon has no reason to buy big from you starting out. Their algorithms are based on sales history, so you need to build that up over time. They do not see that you have many potential customers, and while it could end up being a great seller in the future, Amazon wants to see the numbers now.
However, if you are a third-party seller, you can create advertisements for your products which will help to increase the sales of the new product that you are launching. This means that the product is going to start selling and once it does, Amazon may decide to buy big on that item from you via Vender Central.
Excepted from my soon to be released eBook, Selling on Amazon – Strategy and Tactics that Help You Succeed.
Need help making more profits on Amazon? Thinking about a hybrid strategy for your toys on Amazon? As always, if you have any questions you can contact me at firstname.lastname@example.org or visit my Blog at timothyscottburns.wordpress.com