- PPF Points
- 2,039
Avoiding the amazon marketplace might seem logical if we look at disadvantages associated with using it. One of the most significant pitfalls is the massive competition—on Amazon, the market is oversupplied with vendors who are offering the same products at different prices, most of them tending to be so low, making it virtually impossible for you to make the customer remember you unless you lower the prices continually and/or splurge a lot on ads. Furthermore, there are the possible risks that Amazon may become a rival to your business; traditionally, they have used the data of a seller to create their own brands, display them at the top of search results and usually give them more preference. Fees add up quickly as well—referral fees, FBA fees, storage fees—eating into your profits so fast you don’t even break even. Why? Not to mention, the customers are not your property when you sell on Amazon; all the buyers are Amazon’s customers, and you can’t have a lasting relationship with them, retarget them and upsell as you can on your platform. Amazon imposes strict rules on sellers and may suspend an account on minor infractions or customer complaints, oftentimes without much of a notice and the appeal process is quite painful. The choices of branding, packaging, and the customer’s experience are all yours on Amazon. That gives you an opportunity to make some brand experiments in the future and to decide on some changes that will suit your brand best. Sellers are also often annoyed with issues of the massive number of fake reviews, counterfeit products competing with them, and a sudden change of policy that may cause the product to go down in the market. So, Amazon is probably not the right place to be if you have a desire to develop and establish a business that is self-sufficient, flexible, and enjoys brand loyalty and control.
