On the face of it the Amazon E Commerce offering for thrid parties doesn't seem to offer sellers very much at all.
Effectively what you are doing is stocking Amazon's shelves with your own goods at your own risk and paying them quite high fees for the privilege. (circa £30 a month plus 10-15% of the sale price).
Certainly its a great way for Amazon to offer a huge range of slow moving lines with absolutely zero risk to themselves and should a seller hit upon a great new product then it wouldn't take a genius to realise that Amazon will quickly find out and start stocking it themselves.
Another downside to the Amazon offering is its reversal of the EBay process of each seller listing products separately. On Amazon, everyone selling the same item (defined by the barcode) is listed as a competing sellers on the same product listing - using the same photo and product details. This has a great advantage for both Amazon (reducing product database issues) and the buyer (they see one product description per product rather than the 100's on EBay) but the big problem for sellers is that the only differentiator between sellers is now the price. This can lead to dutch auctions where competing sellers progressively cut each others throats to be the cheapest (and therefore successful) seller of the product.
So, with all these problems (highish fees, cut-throat pricing, doing Amazon's market research for them) why would anyone sell there?
For some sellers dissolutioned with EBay its pretty much the only place to go. If you are selling brand new, brand name items which are easily available on the highstreet or in lots of on-line stores then your chances of getting high visibility in Google (without paying a fortune in adwords) are pretty close to zero. Google and to a greater extent customer behaviour are working against you and so you need to get your stuff visible somehow.
For a minute think like a buyer. If you are looking for a, say, Barbie townhouse by Mattel you have a few options....
1) You can try EBay- type in a few words on their search engine and get swamped with thousands of options 99% of which are useless or broken or secondhand or for unbranded 'dolls house/townhouse suitable for Barbie' rip-offs (EBay's search system is a byword for completely useless and impossible to use rubbish)
2) You could search in Google and get 105,000 results (most of the first page which are with Amazon anyway) and spend ages looking and comparing or
3) Go to Amazon and find it almost instantly and be able to compare 4-5 sellers straight away on a single page.
After a while customers quickly work out the best thing to do.
Therefore having an Amazon shop isn't really like having a Shop on Amazon. Its more like signing up to an Amazon branded shopping/price comparison site and getting them to do the SEO and adwords campaigns for you.
When you stop thinking of Amazon as a storefront and consider it more to be a comparison site where you are paying a success fee then its system starts to look a little more sensible. (particularly if you are careful and can persuade customers to bypass Amazon the next time)
Certainly its fees begin to compare nicely to a potentially expensive adwords campaign where conversion rates are almost always single digit.
So what is Amazon good for selling?
I would say (based on my experience) that it is great for mass market, mainstream stuff that otherwise would be too expensive to market effectively via adwords. Amazon is starting be become a byword (just like google did) for shopping searches for new items.
So now we know that
EBay is good for unbranded, clearance and secondhand bargains
and
Amazon is good for new, branded mainstream products
Where does a website fit into the pattern?
Well that will be part three
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