5 Reasons why I hate Amazon for being bad for sustainable business building

5 Reasons Why I Hate Amazon for being Bad for Sustainable Business Building

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5 Reasons why I hate Amazon for being bad for sustainable business building

Just the other day I had a client email me that he invested $20K in inventory for the upcoming holidays when Amazon suspended his product listing. Now he has no place to sell his products.

People who used to rely on paying for reviews to boost their Amazon listings no longer know how to launch their next product.

Here’s the thing. If you want to be successful in business, you have to learn how to generate your own sales. And, you also need redundancy.

  • You need multiple sales channels
  • You need multiple sources for your products
  • You need multiple marketing channels

If you rely on any single thing, then you are opening yourself up for long term disaster.

Even if you’re doing incredibly well selling on Amazon right now, you need to understand that the skills required to run an Amazon business are only a small subset of the skills required to run a successful ecommerce store.

Amazon does almost all of the heavy lifting for you. It’s very easy to become addicted and that’s what they are counting on.

Here’s why Amazon sucks when it comes to running a long term ecommerce business and why relying on Amazon is limiting your sales big time.

Not being able to connect with your customers

Have you ever noticed that Amazon doesn’t allow you to cross sell your products via email? They also don’t allow you to contact your customer for any purpose other than to follow up with an order.

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When you can’t contact your customers past the initial sale, you are missing out on a fundamental concept of business success – Repeat customers!!

Because Amazon doesn’t let you do this with your customer base, you are not only missing out on mastering an important marketing skill, the email marketing but you’re also losing sales as well.

Not knowing your business stats

Have you ever tried to log into Amazon seller central to figure out your profit on a per product basis? Exactly. Amazon makes it almost impossible to figure out where all of your money is going and that’s in their best interests.

By forcing you to piece together revenues, costs and PPC spend from different reports, they keep your eyes focused on your revenue and not your profit.

This is exactly what Ebay does as well. By obfuscating your costs, you get the highs of making the sale without the lows of all the fees.

B2B sales

Did you know that B2B sales make up over 85% of all ecommerce revenue?

Even though Amazon is now starting to focus on this market, the majority of Amazon sales are to the general consumer.

With Amazon, it’s less likely that you’ll get repeat customers at all let alone repeat B2B customers. In addition, because Amazon doesn’t really provide customer service, you could be missing out on big buyers if you don’t have your own webstore.

Building your own Brand

Most importantly, Amazon doesn’t want you to learn how to build your own brand. Most people who shop on Amazon think that they are buying from Amazon and there’s very little transfer of brand equity.

brand

By focusing solely on Amazon, you are missing out on the human elements of selling online. You are missing out on gaining the mindshare of your customers.

Mindshare leads to loyalty and it’s the little things that make your brand memorable. All of these things add up to a brand that’s much more memorable than a listing and a price tag on Amazon.

Becoming self sufficient

Bottom line, your business is at risk if you’re placing all of your eggs in one basket and you have to have contingencies in place.

Even though we are purchasing a lot more inventory by taking Amazon sales into account, if Amazon were to ever ban our account, we would still have another channel for sales. It might take a little longer to move the inventory but we would not be dead in the water.

The important thing to realize is that by selling only on Amazon, you are not only limiting your skill set but your growth potential as well. The sooner you work on your own brand, the better.

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3 Comments

  1. I agree Sir but just because they have gained consumer trust every one prefers to buy from them. It is very difficult for new sellers to build credibility in the e-commerce market for example when I was doing Shopify dropshipping I only got orders for the items that were not easily available to the consumer. What I learned is if the product is too generic there is very little chance that a consumer will buy this from you and leave out giants like amazon.

  2. I agree with the concept and at the same time confused that if Amazon n eBay r doing this with us then what are other channels and how to use them. That question I expect an answer from EO in the coming days I believe

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