Succeeding on Amazon is not as easy as you think. It takes time to build your brand on the platform, and there are several ways to go about it. Market Performance Group's Bryson Buck is an expert on helping brands succeed on Amazon, and at ECRM's recent Innovate X: Winning in Grocery Summit, held at ECRM's Center Store Grocery Sessions, he gave a presentation outlining what brands need to know to do business on the platform.

In this video interview, Buck provides some takeaways from his presentation.

1st Party Fulfillment model

Amazon has two fulfillment models, each which operates differently. It's 1st Party fulfillment model operates much like a traditional retailer agreement model. Amazon gives the brand a purchase order, the brand fulfills the order, and Amazon becomes the seller of record and sets the prices. You are selling your products wholesale to them, and they then are responsible for selling it. The brand is responsible for helping drive traffic to their page. 

This model is pretty hands off from the perspective of the brand. Once Amazon has the products, they can do what they want with it -- ship it to different fulfillment centers, etc. The brand's only job is to fulfill the purchase orders, which typically come in weekly.

3rd Party Fulfillment Model

In the 3rd Party model, the brand is the seller of record. They are still responsible for sending product to Amazon for fulfillment, but instead of selling it wholesale to Amazon, they are selling directly to the consumer via the Amazon platform. 

In this case, the brand is responsible for managing inventory and getting it to Amazon, and Amazon can move it to various fulfillment centers to meet Prime availability requirements. However, if you send Amazon too much inventory you can get hit with long term storage fees, so it's important to pay attention to demand on the platform and forecast accurately. 

Content is king

In both cases, it's important to drive traffic to your page via ads on the platform as well as off the platform (online, social media, etc.). For this, content is king. Not only must you have smart marketing to drive consumers to your Amazon page, but your product page content must be on point, with thorough descriptions, sharp images, product carousels and videos. This is what makes a person decide whether to add the product to their cart or click to a competing product -- which is often right there on the page as well!

So regardless of which type of fulfillment model you choose to pursue, before you get started, make sure that you have achieved the operational excellence needed to support it. Make sure you have enough inventory in stock, that your supply chain is optimized, and that you have quality content that's ready to deploy!