How Retailers Can Benefit From Selling on Amazon
More Customers, Less Work, Big Opportunity.
By Chase Shiels
Awhile ago we posted this picture to our Instagram about Amazon’s home services offerings. Just recently there was an industry publication which covered it, which was awesome to see. In the article, there seemed to be distress over “saving the installers” — which isn’t even anywhere close to why Amazon wins against specialty retail; they win on customer experience which comes from convenience. It also said something to the effect of, “If Amazon gets serious about this…” At this point in time, it should be very clear that Amazon is very serious about moving into the home improvement space. And that’s great news for retailers, because retailers can seriously take advantage of working with Amazon. Here’s why.
Get customers you wouldn’t get otherwise — then sell them additional items
There’s no real reason to run from Amazon. In fact, selling your retail business’s services (like installation) on Amazon can introduce you to a bevy of new customers you didn’t know existed. These are the customers who are going to buy online anyway, so if you’re not conducting e-commerce this is an excellent way to get your feet wet and get your business some great exposure. This type of customer is becoming more common at an exponential rate, as e-commerce in the furniture and home furnishings segment has grown 80x to $28,000,000,000 since 1999. So we know it’s going to continue to grow as more millennials and younger generations purchase homes and furnish/remodel them. As this happens, e-commerce revenue can offset decreases in revenue related to declines in showroom traffic. Selling online and offering free delivery (just price it in) or in store pick up is a great revenue driver well.
Of Lowe’s online sales, 60% pick up in store and 40% of those purchase additional items
You don’t even have to sell!
This is one of the most beautiful parts about Amazon. They literally do the selling for you and then you get paid for it. If you don’t want to deal with freshening up your sales process or showroom experience, while we highly do not recommend that approach, letting Amazon do the selling for you is an excellent way to put that off.
Here’s how it works: a customer buys the product on Amazon, and they can select whether or not to include professional services. If you look in the image below, there’s a box which is selected that says “Get professional installation” right there. It’s all wrapped up into the checkout process as is.
But I’m swamped as is, I don’t want to grow!
No problem — keep this article handy for when you might want to. Do keep in mind that as we mentioned earlier, the number of customers who are going to buy online is going to continue to increase. In fact, the Department of Commerce recently announced that in second quarter of 2017 retail was up 4.1% year over year (YoY), and e-commerce rose by 16.2% YoY or more than double the pace of retail sales. Regardless of whether or not you’re incredibly busy (isn’t everyone?) right now, it’s definitely going to be beneficial for you to become familiar with e-commerce in the very near future and this is a great way to do just that.
Where the leader goes, the pack will follow
Wayfair has its own installation program, and Houzz has a marketplace just like Amazon for products where businesses can sell products today. In Houzz’s case, as a rapidly growing private company that just raised $400MM from venture capitalists, you can bet they’ll be chasing Amazon and Wayfair on this one and will be offering some sort of installation/home services package in the near future to continue on their growth trajectory. The market will continue to go this way. Again, these companies are simply selling convenience — which is really just time. Offering customers convenience & time is a major key to winning in the next 24 months and beyond.
One of great thing is that in Amazon’s case, there are zero up front fees or costs to getting started selling your services them. At the very list this is definitely worth a look and could help your business develop an additional revenue stream, while getting you additional customers quickly & for the future that you might not have come across anyway.