How you can beat Amazon on price and service
Competing with Amazon is one of the main concerns that many sellers have about starting a web store. As Amazon’s marketplace has grown, they have become renowned for their attractive pricing and efficient service, something that many sellers fear they won’t be able to replicate.
But sellers shouldn’t be deterred. While trying to beat Amazon for price and service might be difficult, it’s not an impossible task. As you’ll find out in this article, by playing with your margins, developing a unique personality and utilizing software, you can give Amazon a run for their money.
Let’s start by looking at how you can beat Amazon on price. This is probably the more difficult aspect as Amazon are prepared to make long-term losses on certain products, in their pursuit of selling everything. This is a luxury that many sellers won’t have, but targeting the following areas can give you a fighting chance!
Everyone loves a discount. Whether it’s for 10% off or just for free shipping, it encourages buyers to purchase your products and often place bigger orders than they normally would.
You could offer a discount in a number of ways. It could be that you include a discount code in your marketing emails, hold site-wide events offering different discounts or use influencer market and distribute codes across social media (particularly Instagram).
Another thing to consider, is that Amazon only offer students a 5% discount. So, if your target audience is millennials, bumping that up to 10% could make a big difference to your sales.
Minimize Your Fees
Minimizing your fees should allow you to make the same margin at a lower price. This is a great situation. Your products are more competitively priced, so more attractive to buyers, but you don’t end up out of pocket.
So what fees should you be looking at? Well, a few suggestions are:
- Warehousing Costs - Is your warehouse running efficiently? Are you optimizing your space? Are you making good use of technology? Is your inventory protected from damage? And, if you’re using a 3PL, have you negotiated the best possible deal,
- Web store Fees - Have you compared web store platforms? If so, are you on the right plan? Do you use all the features you pay for, or would a cheaper plan suffice? Are you paying high transaction fees? And could these be reduced by using the web store’s own payment platform?
- Inventory Costs - Could you negotiate better MOQ’s with your supplier? If not, do you have the cash-flow to buy in bulk and get a better per unit price?Reducing your warehouse costs will allow you to pass savings on to the customer.
Use A Repricing Tool
If you’re planning to offer a large amount of products on your web store, then it’s worth investing in an automatic repricing tool. Amazon makes millions of price changes every day, so to stay competitive by repricing your products manually is almost impossible.
With Repricer, you can you set rules, or use pre-defined strategies, to make real-time pricing changes. Sellers can make increases as well as decreases to their prices and safeguard their margins by setting price boundaries. You can then replicate your Amazon prices on other marketplaces and your web store, a great feature for multi-channel sellers.
Find yourself a point of difference
Finding something that sets your business, or products, apart from your competition is crucial. It can even help you beat Amazon to the sale despite charging a higher price. How is this possible? Well, buyers are happy to pay more because their getting something extra, or doing a good deed.
Beardbrand is a great example of a brand with a strong point of difference. By becoming experts in the field of beards, their 136,000 Instagram followers trust their products and are willing to pay that bit more for them. Similarly, fashion brand DIFF Eyewear have done a great job of using philanthropy to set themselves apart. Every time that a pair of sunglasses are purchased, they donate a pair of reading glasses to individuals in need all across the world.
Service is where you have a real chance to shine. By having a glowing personality and always being on hand to help your customers, you could leave a lasting impression. It’s all about efficiency, tone and going beyond the customer’s expectations.
Become The Expert
Amazon may offer a wide range of products but it does not have expert knowledge on them all. It’s not always easy for buyers to ask questions about products on Amazon, especially if they want to know which one best suits their needs. This is something that you can really take advantage of, particularly if you operate in a technical niche.
So, make sure that your customer service staff all have a high-level of technical knowledge. They should know the market inside-out and be able to give product support and expert advice.
Let’s say that a customer is shopping for computer parts. If they know that you’re going to recommend a suitable graphics card and be on hand to help if them if they can’t install it, they’re likely to buy it from you. This level of aftercare is not offered by Amazon.
Use Customer Service Software
To beat Amazon on customer service you need to be efficient and resolve issues swiftly. To achieve this, many sellers use a customer service tool.
With eDesk you can assign customer support cases to different members of your team. This can help you ensure that no cases get missed. The intelligent response-template feature even means that you can message buyers swiftly during particularly busy periods.
It also improves the quality of your replies. You can create templates for different customer support scenarios, which can then automatically be filled using smart tags. This allows you to bring in key facts like the customer’s name, address and their order number.
eDesk is integrated with many shopping carts including Shopify, BigCommerce and WooCommerce.
Show Your Personality
While Amazon’s customer service is efficient, it is also very robotic. By handling your own customer service, you have the chance to inject some personality. Of course, this has to be balanced with professionalism. But by developing a voice or tone for your site, you’ll engage more with your customers. You won’t seem like just another retailer!
This can extend to the way you package your products too. Adding personal touches to each order can help you surpass the customer’s expectations. It is also something that Amazon doesn’t allow sellers to do, so it’s going to make your service stand out.
It could be that you include a free gift, additional product information, suggestions for other products they might like or even just a thank you note. For example, some online record stores will include a note recommending other artists or albums which that buyer might like. Another great example for consumable products is including recipe cards.
The Bottom Line
Competing with Amazon is always going to be a challenge. But by arming yourself with the right tools and setting up your web store the right way, it’s a challenge you can win. The key is to focus on both price and service, rather than trying to beat Amazon on just one front. This way you’ll attract customers with your offerings, as well as your personality.
Repricer.com is the ultimate Amazon repricing software available, enabling you to react instantly to changes in the marketplace and stay ahead of your competitors. Start a free trial today and win the Buy Box.