Amazon’s Marketplace: Friend or Foe?

Among the strategic struggles that plague online sellers is the big question: Is Amazon’s marketplace a friend or foe?

No question anyone looking to do business on the internet would drool at the reach that listing products on Amazon, with its 100-million-plus Prime members, gives you. Mary Meeker’s Internet Trends 2018 report underscores the importance of Amazon as a commerce giant in just a couple of statistics.

First, Amazon’s share of ecommerce sales is now at 28 percent, up from 20 percent five years ago. More importantly, nearly half of consumers — 49 percent — now start their product searches on Amazon.

So listing on Amazon is a way to be where consumers are.

But it’s not all upside. In fact, as we mentioned in a previous post, Jules Pieri, the CEO and co-founder of The Grommet, has serious concerns about manufacturers, makers and others who use Amazon as a sales channel. She shared her thoughts with us in the video interview below conducted at IRCE 2018.

For added context, The Grommet is itself a platform for manufacturers and makers to sell on. The Grommet, in fact, seeks out distinctive products that have yet to be discovered in a big way and presents them for sale, not just as products, but as stories. Pieri calls it citizen commerce, a notion that resonates with the creative entrepreneurial set, if the line of those waiting to meet Pieri after her IRCE presentation was any indication.

Pieri, in her interview, brings up an interesting business imperative for Amazon CEO Jeff Bezos, who is fending off Chinese marketplace giant Alibaba. An example of the companies’ rivalry is currently playing itself out in India, according to Fox Business News.

Pieri alluded to a problem with counterfeit products, which has driven some brands to abandon their Amazon marketplace strategies. For others, the opportunity presented by Amazon’s reach is simply too great to pass up.

In an upcoming post, we’ll share Pieri’s thoughts on just where direct-to-consumer sales are today and how brands can best take advantage of that opportunity. 

Photo courtesy of Amazon

Contact Mike Cassidy at mike.cassidy@signifyd.com; follow him on Twitter at @mikecassidy.

 
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