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E-commerce for Brands

Building Brands on Amazon — Then and Now

E-Commerce with Coffee?! podcast guest Liran Hirschkorn explains

Liran Hirschkorn, founder and CEO of Incrementum Digital, joins host Nate Svoboda on an episode of E-Commerce with Coffee?! to offer some unforgettable details about Amazon “then and now.”

Liran’s own experience growing brands on the giant e-marketplace started almost a decade ago. After early success, he became more curious about the future of e-com on the platform and positioned his new brands accordingly.

As Amazon started to scale new features that today we consider universal, Liran was at the front of the pack in strategy and adoption. Now, this interview with Liran provides listeners with an instructive look at wholesale modeling and private labels unlike any interview before it.

On the show, three of the key topics Liran covers are:

  1. What the pandemic meant for the supply chain and Amazon niche saturation
  2. What the most recent changes to Amazon mean for sellers (new and old)
  3. How a brand can “fail fast and fail forward” while staying competitive

The Supply Chain and the COVID-19 Pandemic

On E-Commerce with Coffee?! Liran dives deep into the changes that the pandemic drove in the supply chain. It all started with increased demand (with some estimates showing as much as 10 years of growth to e-commerce in a matter of months).

With that demand, new supply chain hiccups became an enormous issue for sellers, marketplaces, and retail stakeholders overnight.

Amazon warehouses and other shipment facilities were instantly faced with social distancing requirements. Online services — both the online experience and the fulfillment behind the scenes — were not dimensioned for the hike in demand, either, and repeatedly crashed. The pressure was also applied to sellers to provide an even faster delivery time for goods consumers would have normally bought in-person.

Amazon also made the choice to focus on essential products that people needed most. That meant clearing out or back-storing other products to make room for the new. The company started to add product categories around “priority products” as a result.

Merchandising was rethought, too, with more consumer purchases becoming impulsive rather than rational. Consumption habits changed during sweeping lockdowns in other ways as well with new demand for home gym equipment, health supplements, and more.

There were also “fewer deals on the [Amazon] platform, because if you didn’t have excess stock in the warehouses, why offer your products for less?” Liran mused through the supply chain issues from consumer to warehouse and back again.

Read more on what new logistical priorities have meant for how things are packaged.

Changes to Amazon

Amazon ads have gotten more competitive (and complicated) over the last few years, Liran admits, which was why he first started helping other brands. As ad trends changed, he started helping brands build better ad strategies.

Thus, Incrementum Digital was born.

Liran has seen other major changes for Amazon sellers on the platform. For example:

  • Bigger organizations are acquiring successful Amazon brands to create mega-competitive conglomerate brands.
  • Incentivized reviews (which were once an easy way to get early reviews as a new seller) have been done away with.
  • Product data, too, has to be made more competitive for listings to meet consumer needs. (Read up on the 6 signs you should be concerned about your product data.)
  • Video ads, editorial recommendations, and more new offer opportunities are also present for sellers. (Learn more about the psychology of product imagery.)

“Amazon seems to be embracing brands a little more than they did,” Liran reflects.

Where to Focus your Amazon Strategy First

One of the biggest questions brands have today when assessing an entry to Amazon is whether their niche is already over-saturated.

The advantage brands have today in considering niche saturation, Liran says, is the “tremendous amount of data available to you.” In some niches, “you have to lose money for a set time until you can get enough reviews.” New sellers should consider how deep their pockets are when entering into a niche that already has big players.

Liran spends the final segment of the interview talking about specific hurdles for new brands selling on Amazon.

For instance, “once you launch a product, within 12 months you’ll know if it has real demand.” Liran says that if you feel like you’re “fighting an uphill battle within the first two months from launch, that’s a sign your Amazon strategy or product isn’t working.”

The first month is the most important for Amazon’s algorithm to determine your product’s “relevance,”. Amazon actually likes new brands and products to challenge existing ones, Liran says, which is something new brands should leverage.

Listen to the full episode for the SOPs Liran says you can develop to be prepared for this.

Ultimately, Liran assures us, “the opportunity [on Amazon] is greater than the headache.” He adds, “if you’re not converting early on, it’s not a traffic problem,” meaning strategy is essential.

Keep reading to learn more about staying ahead of the competition on Amazon and other e-marketplaces, and listen or watch the full episode of E-Commerce with Coffee?! for more of Liran’s insights, examples, and tips.

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