Over the years, online Amazon E-commerce has multiplied and transformed retail. Our pre-pandemic estimates had Amazon growing 15.9% to $302.36 billion this year. We now expect it’ll grow 15.3%, reaching $367.19 billion, an upward revision of more than $64 billion. This was further enhanced after the pandemic of the new coronavirus, which forced the population to stay at home, and online shopping was the best option.
But, with so many new technologies and advances in the industry, Amazon e-commerce has undergone significant transformations. For starters, Amazon has voice-assisted devices that allow you to place an order and track these purchases for you, like the Amazon Echo and Alexa. And, for sure, this is just the beginning.
Social media has broadened its scope of activity and has considerably improved sales capacity. Even a novice or inexperienced person can buy products quickly and conveniently on any social media platform.
Social media channels, such as WhatsApp, Twitter, Pinterest, Instagram, Facebook, and even YouTube, have developed purchase buttons and several other sales features to facilitate transactions.
But, regardless of which communication and sales channels are most used in the future, one thing is sure: everyone will be connected, ensuring an omnichannel experience for consumers. With this growth and with Social media broadening its scope, there have been three big challenges that have been brought up, and here’s how to overcome them:
- Amazon pays third-party sellers every two weeks. The challenge is fronting capital for inventory long before you start to see income from that same inventory.
- Many sellers hire manufacturers in China to produce an inventory for them (especially private label brands). Those manufacturers will usually charge somewhere around 25-50% of the cost of the inventory upfront before they begin production. Depending on the manufacturer and the quantity you are ordering, the production and transit may take several months.
Cashflow is easily one of the biggest challenges that most Amazon sellers will face (and really, this can apply to other e-commerce businesses as well). So the more cash and/or external financing that you can have to back up this demand will help you and your business exponentially.
- EXCESSIVE COMPETITION
- Amazon presents sellers with an incredible opportunity, and as a result, millions of sellers have jumped onto the platform. However, the significant competition can be brutal since so many sellers compete for exposure in the search results.
This can be combatted by making sure that you know what the keywords that are being searched to find your product and other competitors are. SEO is a big part of this search and is very key in making sure that you come out on top.
- CATEGORY RESTRICTIONS
- Over the years, Amazon has become increasingly strict with the third-party sellers that they allow selling products in certain categories. (This is mostly for the safety of buyers and as an attempt to reduce the number of counterfeit products that are sold on the platform.)
- Getting approval to sell in some categories can be very difficult, especially for small sellers. In some cases, you’ll need to purchase inventory to have the documentation required by Amazon be approved to sell. That means you’ll need to pay for inventory that you won’t be able to sell if you don’t get approved.
Coming prepared with this initiative is making sure that it fits in the specific category that you need and just checking the basic requirements from the get-go.
Persistent technological and infrastructure advances indicate that the future of e-commerce will be even more vibrant and scalable. To face the challenges of changes in e-commerce, it is necessary to update and prepare. By being prepared, you are sure to be on the right path to success!
In conclusion, selling on Amazon can be tricky, but if you are aware of what’s coming and the different changes that will be there, you will be sure to succeed. So make sure that you have the cash flow, work on your keywords, watch what your competition is doing, and look out for the category restrictions you will be more than ahead of the game.