What direct-to-consumer brands do better than Amazon
If you’re running an online brand, I’m pretty sure at least somebody in the past 12 months asked you if you’re afraid of Amazon?
And since you’re a confident entrepreneur, chances are you’ve said “No, I’m not afraid of Amazon”. But deep inside you know that if your niche grows big enough, Jeff & company will jump onboard and try to own it.
And that’s alright. Because if you manage to build a healthy and sustainable brand, Amazon doesn’t stand a freakin’ chance.
Amazon is obviously a massive machine and it’s brilliant at execution, but there are a few major things they will never be better at compared to you.
And all of those things might seem like a common sense, but… oh well, common sense is not so common! Make sure you’re aware of those strengths that you have and more sure you’re constantly advancing at each one of those to make sure neither Amazon or your competitors can hit you.
Knowing the customer
Amazon doesn’t understand your customers. They have algorithms in place that help them show your audience the right products in the right context based on historical data of previous buyers’ behaviour. And this is great when you have millions of SKUs onboard for different personas. There are a few downsides, though:
- Although it helps Amazon know what you’re likely to buy, they don’t know why you need it
- Amazon offers products based on existing demand on a large scale— they don’t really create new categories of products
On the contrary, direct-to-consumer (DTC/D2C) brands know why they exist, why their customers need their product and what their needs will be in the future. Most of the time they invent new categories of products.
Amazon is selling products.
Direct-to-consumer brands are solving problems.
And that makes a huge difference in the long run — Amazon is reactive, not proactive. Sure, Amazon can own low-end deodorants selling at $1 in the long term — it’s a $73B/year market and they can probably snap 50% of it in the next 10 years.
But they will never own the high-end products in the market (or the niche, highly targeted ones) that amount for a few billion dollars in sales annually.
And those are the billions you care about in the long term, obviously.
Understanding the problem
All great products that created their own categories of products started by being a solution to a specific problem. Chances are, your direct-to-consumer brand started the same way.
Amazon doesn’t really care about the problem and they never will. By being in almost every possible retail category, they don’t care about innovating the actual products they ship. They care about selling certain amounts of stock.
And it’ll never change — Amazon is a retailer. You’re a creator.
Consumers’ problems are always evolving. Today’s solutions won’t be tomorrow’s solutions. Innovation is up to creators, not retailers.
A retailer can improve the experience of your customers getting a specific product. They can’t really improve the actual product.
Once again — Amazon is reactive, not proactive.
By focusing on your target consumer niche, you can understand who those people are, what they need and predict what they’ll need tomorrow, a few months from now, maybe even a few years from now. And you can lead that process and improve your customers’ lives in the long-term.
Amazon can’t do that.
Creating long-term experiences in the right context
With today’s short-term attention span and almost non-existent brand loyalty (at least compared to 10 years ago), shaping long-term relationship with your customers is the way to go.
That requires establishing brand experiences that last.
Amazon can’t do that. Their brand is all about the purchase. Your brand is all about the product. People buy because of the product. And when they want to buy again, they’ll buy because of the product. Even if it’s slightly more challenging than the One-click buy.
Community
Today’s brands are all about being different (and better) than the status-quo. This simple fact enables the creation of communities (even brand ambassadors) around ideas or statements.
Good brands change lives — and it’s easy to unite people around a positive change.
It’s also easy to turn those people into brand ambassadors. If you’ve enabled them to improve something (however small it is) in their lives, consider them your community. And count on them to spread the good word.
Constantly improving the product
Direct-to-consumer brands own their product. This enables them to improve it constantly — which is something your customers require (even if they don’t demand it).
As consumer’s needs and problems evolve, solutions (and logically, products) need to follow.
It’s not about building the perfect product. It’s about striving for continuous improvement. This is where Amazon is failing.
Their product is not the actual product people use in their daily lives. Yours, is, though.
Amazon will always be making hundreds of millions (and one day, maybe billions) people feel OK.
But you can make a million people feel GREAT.
And still make an 8 or 9 figure business out of it like those guys did, for instance.
As long as you care about your customer more than you care about their order, you’ll be fine.
