For online sellers, their relationship with Amazon can be, well, complicated. Amazon does give product companies access to the world’s largest ecommerce marketplace, letting them sell, ship, and get paid through Amazon’s systems. But Amazon takes a hefty share of a seller’s revenue to provide that service.
More companies, from small businesses to globally known brands, are instead revamping their direct-to-consumer sales approach, through their own websites and stores. This strategy allows them to maintain greater control over their brands, set consistent margins, retain their sales data, and nurture a closer relationship with customers — otherwise, brands that find that products selling well on Amazon may soon find new competition from other brands or Amazon itself, inspired by that very success. And, if they can run their direct sales business well, they can hopefully reap higher profits by keeping more of that sale. Many also take a hybrid approach, selling a limited selection through Amazon and other ecommerce sites while trying to woo customers to buy direct.
For smaller businesses, competing with Amazon might seem a bit like an impossible David vs. Goliath scenario. But there are ways to level the playing field. Here’s a look at 10 tactics to potentially outmaneuver Amazon at its own game.
Key Takeaways
- Businesses can compete with Amazon by optimizing their logistics capabilities, offering fast shipping and providing a streamlined checkout experience.
- Harnessing big and small data, along with providing superior customer support, can help businesses stand out next to Amazon’s broad-stroke strategies.
- Building a genuine brand community, personalizing the customer experience and focusing on niche products can all help foster deeper customer relationships and loyalty.
- Careful use of digital marketing strategies, such as search engine optimization and content marketing, as well as new digital opportunities, like blockchain, can also enhance a brand’s competitive edge.
10 Ways to Beat Amazon
Amazon has revolutionized ecommerce and in many ways set standards rivals need to meet. Simplified shopping experiences, smart logistics, simple returns, and lightning-fast shipping, for instance, have all significantly influenced customer expectations. This impressive level of mass-market appeal and previously unheard-of operational efficiency may seem impossible to match, but Amazon’s success provides a blueprint that can offer opportunities for other companies to carve out their own niches.
1. Enhance Logistics Efficiency
Amazon’s logistics and distribution network runs on a scale greater than any growing business can rival. But that doesn’t mean a smaller business can’t find ways to provide a service level that still delights its customers. The more organized a warehouse, for instance, the quicker the picking and packing process. Warehouse management systems (WMS) are affordable tools that can help companies optimize inventory layout, devise streamlined picking routes, automate order processing and provide real-time data about inventory location, order status and customer purchasing trends — all of which can increase order processing speed, improve delivery times, and reduce waste.
Besides WMS, other software solutions, such as demand forecasting and inventory management platforms, can help companies predict customer demand and manage inventory more efficiently, preventing stockouts and minimizing overstocks that tie up capital and increase carrying costs. Cloud-based versions of these tools can be particularly beneficial for growing businesses because they tend to be more cost-effective than on-premises solutions, scalable and do not require extensive IT infrastructure and personnel to implement.
As businesses grow, robotics, automated guided vehicles (AGVs), robotic picking systems and conveyors provide additional avenues for improving logistics capabilities. These tools can automate repetitive tasks, decrease manual labor requirements, reduce human error and accelerate the overall speed of fulfillment operations. However, they also tend to demand a hefty up-front investment. For businesses without the capital, simpler, more accessible tech upgrades can also provide substantial returns on investment by enhancing logistics efficiency. Barcode scanners, for instance, can drastically cut time spent on manual stockkeeping and order processing, while radio-frequency identification, or RFID, technology can boost inventory tracking and accuracy for faster and more reliable fulfillment.
2. Aim for Faster Shipping
Seventy-eight percent of online shoppers look for same- or next-day shipping when making a purchase — a modern mindset likely influenced by Amazon Prime’s bar-raising delivery standards. For some companies, these fast shipping times may be hard to beat. But the competition isn’t insurmountable, and even Amazon quietly removed “two-day shipping” and shifted to “five-day delivery.” And predictability also has high value: You might not be able to do same-day shipping, but delivering that unique product or price that a small business offers, and getting it within the promised three days, might be fine by most shoppers.
Businesses can explore several ways to rival Amazon’s delivery capabilities. Distributed warehousing, for instance, allows companies to store goods in multiple, strategically located facilities to minimize delivery times and cut shipping costs. Walmart, who has been making gains with its competing marketplace, competes with Amazon by fulfilling and shipping online orders from physical stores. Not all growing businesses have sufficient capital to invest in nationwide warehouse infrastructure, but businesses with brick-and-mortar stores can blend online and physical stores to leverage retail locations in a similar fashion with ship-from-store and buy-online-pickup-in-store (BOPIS) options to get products to customers on the same day.
Alternatively, companies can form partnerships with regional fulfillment centers to access the benefits of distributed warehousing without the hefty investment in privately owned infrastructure. These collaborations provide businesses with access to multiple storage locations and advanced fulfillment solutions, increasing their ability to offer expedited shipping. Engaging with third-party logistics (3PL) partners can be a cost-effective way to improve shipping performance and keep pace with customer demand. For example, 3PL partners can offer expertise and resources that small businesses might not have, such as advanced fulfillment software that handles complex logistics tasks, and broader distribution networks that reach more customers at a faster pace. This approach not only facilitates quicker last-mile delivery but also minimizes the capital required for expansive shipping setups.
Of course, the success of engaging with any partner hinges on effective management and communication to promote a seamless customer experience. In short, businesses need to be able to ensure that the partner will uphold the brand’s promises of quality and reliability.
3. Provide Unique Shopping Experiences
Amazon excels as a one-stop mass marketplace, but its uniform, catalog-style approach can stifle sellers’ creativity. Businesses looking to compete with the ecommerce giant can distinguish themselves by crafting one-of-a-kind, immersive, online shopping experiences that connect personally with customers.
Offering exclusive products not available on Amazon can be a draw, but, in some cases, the real differentiation comes from how products are presented and experienced. Curating a selection of products tailored to the specific interests and needs of a target audience can make for a manageable, navigable and intuitive shopping experience that stands out from Amazon’s vast catalog. This curation might involve personalized recommendations, thematic collections or interactive guides that help customers discover and explore products in a more meaningful context.
Using technology to create immersive experiences can further elevate the online shopping journey. For instance, augmented reality and virtual reality technologies can allow customers to visualize products in their own space or virtually “try on” items, offering a higher level of interaction and engagement.
Additionally, hosting live events, such as online product demonstrations, tutorials and Q&A sessions, can engage customers to create a sense of community and exclusivity. These events can be amplified through social media, where high-quality branded content not only showcases products but can be used to tell compelling stories that connect emotionally with customers. Content, such as behind-the-scenes looks, can help the shopping experience stand out more strikingly and effectively than more transactional models.
4. Use Big and Small Data
Companies of any size can harness both big and small data to discern market trends, predict consumer behavior, garner granular insights into customer preferences and tailor experiences to meet those needs accordingly.
Big data refers to the vast volumes of information generated from multiple sources: online transactions, social media interactions, Internet of Things devices and the like. By applying sophisticated algorithms and machine-learning techniques — a process often referred to as “data crunching” — companies can sift through these large datasets to uncover and analyze patterns that can be used to forecast demand, optimize pricing and personalize customer interactions. And, with business intelligence tools that provide real-time access to this data and its analyses, companies can stay well-positioned to proactively respond to market shifts and demands. By keeping sales off of Amazon, businesses retain a marginal advantage.
Small data, by contrast, focuses on the detailed insights gained from direct interactions with customers. This information is gleaned from customer reviews, surveys, feedback forms and personal communications via email, webchat or social media. Unlike big data, which compiles vast and varied information to identify overarching trends and patterns, small data offers a more nuanced understanding of individual customer experiences, preferences and pain points. This precise insight allows businesses to act on specific feedback, integrating it into product development, website optimization and targeted social media strategies, for instance. In turn, companies can support more engaging and relevant customer.
5. Deliver Superior Customer Support
With 71% of online shoppers insisting on free returns, companies looking to compete with Amazon must offer a hassle-free return and exchange policy. Clearly communicating return policies, offering an ample return window, providing free return shipping and using a simple online return process that allows customers to print shipping labels at home or at drop-off points can all streamline the process. Self-service through customer accounts, where customers can initiate returns without needing to contact customer support, is also useful. Combined, these techniques can build trust and establish a reputation for reliability and customer-centricity. But free, easy returns only help companies compete with — not outdo — Amazon.
To further differentiate themselves, businesses can aim to provide personalized, attentive customer service. Amazon’s seller policies limit direct communication with customers, providing a distinct opportunity for smaller sellers. Companies that sell directly to their customers can implement nurture campaigns to offer personalized follow-ups, solicit feedback, or send customized discounts based on purchase history. This level of personalized care can transform standard transactions into memorable experiences that inspire repeat business.
Providing 24/7 availability across phone, email, chat and social media is also crucial; customers need a way to reach out and get the support they need, when they need it. What’s more, training customer service teams to go beyond scripted responses to creatively solve problems can make customer support a loyalty-building touchpoint. For businesses without the resources for dedicated, round-the-clock support teams, AI chatbots can offer an initial level of service, guiding customers through common issues and gathering information so that human agents can get back to them ASAP.
Integrating customer relationship management (CRM) systems into the mix can help deliver nuanced customer service. More specifically, CRM systems can track individual interactions over time, revealing patterns that can anticipate needs before they arise and providing a foundation for memorable personal interactions. Tailored suggestions, reminders based on past purchases and personalized greetings are just a few examples of how CRM can bring to the forefront the smaller details that often matter most to customers.
But to get the most out of your customer support goals, it’s important to measure overall effectiveness using customer success metrics, such as customer satisfaction scores, retention rates and net promoter scores. These indicators help gauge the strength of a business’s customer relationships and the success of its personalized service strategies. That gauge can then be used as inspiration for how to improve or change approaches as necessary.
6. Simplify the Checkout Process
To compete with Amazon’s one-click checkout, businesses must meticulously streamline their own checkout steps. To expedite the process, billing and shopping info could be combined into a single page, autofill could be enabled for returning customers and any nonessential fields, such as optional surveys or marketing questions, could be eliminated. It’s also wise to offer guest checkout options, as this shows respect for new customers who don’t want to create an account immediately. Implementing a visual progress indicator, such as a step-by-step bar at the top of the page, can reassure customers about the brevity of their purchasing journeys and, potentially, reduce cart abandonment — and cart abandonment emails serve as opportunities to remind or incentivize customers who may be “carting” items as an informal shopping list.
The checkout experience should also embrace multiple payment options to accommodate customer preferences. Alongside credit card payments, including digital wallets — and even financing options for larger purchases — can make the process as convenient as possible for a broad range of customers. Accepting coupons, promo codes and gift cards can further enhance an ecommerce site’s flexibility and appeal.
And don’t forget about mobile optimization. Seventy-six percent of Americans say they use their smartphones for online purchases; the number is even higher for adults under 50 (87% for ages 18-29, and 92% for ages 30-49). Responsive designs that adjust to any screen size, along with streamlined forms that require minimal typing, are non-negotiables that can facilitate smooth checkouts for anyone, on any device.
7. Build a Community Around Your Brand
Though efficient, Amazon’s model prioritizes convenience and price over personality. Smaller companies can excel by creating a sense of belonging and connection. Put simply, building a community around your brand can foster deeper customer relationships and loyalty.
Companies can cultivate communities around shared interests and values. This focus can energize a passionate customer base, with brand advocates who are more likely to promote the brand through word-of-mouth. Personalized engagement through social media, forums and even customer service interactions, for instance, can ensure that each individual customer or prospect feels valued and heard.
To further cement this sense of community, businesses could host regular interactive sessions, such as webinars, livestreams and in-person gatherings for product launches. Sellers can celebrate customer stories, and plan group discussions that resonate with a brand’s ethos. A boutique clothing brand, for example, might host monthly virtual styling sessions where customers submit their fashion questions to receive live, personalized advice.
Direct community engagement also creates ample opportunities to receive invaluable, direct feedback from customers. This information can be used to hone the product development process — leading to products that better meet actual, on-the-ground customer needs. And, when customers feel seen and heard, their relationship with the company strengthens.
Another way to help build community is to cultivate a sense of exclusivity and privilege. For example, loyalty programs that reward not only purchases but active engagement — such as contributing to forums, participating in surveys or promoting the brand on social media — can enhance customers’ sense of belonging. Introducing a points system for these activities or providing early access to new products can make “members” feel like VIPs, further differentiating an individual brand from Amazon’s more universal approach.
Again, the impact of community-building efforts should be tracked through engagement metrics, customer retention rates and direct feedback. The resulting insights can help continually refine and expand a brand’s community initiatives, to make sure they remain aligned with both the business’s values and its customers’ evolving needs.
8. Personalize the Customer Experience
If it’s not already evident, creating a personalized shopping experience through both a CRM solution and strategy can offer a stark contrast to Amazon’s more uniform approach. Providing personalized customer support, offering payment options that match customers’ personal preferences and cultivating a community space for like-minded customers to interact with each other and the brand are all effective ways to connect on a more personal level. In addition, companies that can curate products, content and suggestions to align with individual consumer preferences can gain a strategic edge by providing an experience that feels more thoughtful and intentional.
Harnessing AI and machine learning to sift through and analyze customer data can provide valuable insights into individual preferences and behaviors. In turn, companies can devise a strategy to deliver highly personalized recommendations that yield a bespoke shopping experience for each customer. Instead of providing a generic “frequently bought together” suggestion through tags and categories, consider a scenario in which a customer views a coffee table book on gardening and is then recommended a rare book on exotic plants, based on their interest history. This level of personalized, AI-powered upselling leverages knowledge about customers and products to place the right items in the right hands, potentially exciting shoppers and boosting order values.
Customer data can also be used to send targeted marketing messages that resonate on a personal level and foster connections that feel genuine. Dynamic email campaigns that address customers by name, refer to past purchases or suggest items based on browsing habits can highlight a company’s attention to detail and create a sense of familiarity.
For some companies, it may be worth offering customizable products or services — after all, what’s more personal than allowing a customer the freedom to create something truly unique? A fashion retailer, for example, might offer the option to mix and match fabric patterns for a dress, while a furniture store could allow customers to design their own shelving units featuring preferred dimensions and materials. This bespoke approach can provide customers with a sense of uniqueness about their purchases, at the same time elevating the items’ perceived value.
Beyond products, curating content and experiences in accordance with customer interests can provide a more thoughtful and intentional shopping journey. A culinary platform might suggest cookbooks, kitchen tools or specialty ingredients based on a user’s dietary preferences and cooking history, transforming what could have been a vast, impersonal catalog into a culinary adventure.
9. Focus on Niche Products
Companies that specialize in niche markets can become market leaders in areas where Amazon’s extensive reach may not be as influential. This strategy involves pinpointing market segments with dedicated followings and providing specific products that cater to those precise needs. In turn, companies can carve out a loyal customer base and become well-respected, go-to providers of distinct offerings.
Identifying a niche requires a keen understanding of consumer needs and market gaps. Businesses must conduct thorough market research to identify potential niches that align with both the company’s strengths and customer interests. Once a niche is identified, the next step is to develop a specialized product lineup that caters to the market’s requirements, using proprietary, retained sales data and customer information to develop products and services. For example, a business that creates custom ergonomic office furniture for remote workers could simultaneously tap into the growing remote work trend and offer a solution that large-scale retailers — who may not know their customers as well — might have overlooked.
Marketing materials for these specialized offerings should spotlight quality, expertise and the unparalleled value they bring. Storytelling and branding can emphasize the distinctiveness of niche products, weaving a narrative that connects with the target audience by celebrating the advantages and superior quality that distinguishes these products from mainstream alternatives. For example, a company selling handcrafted musical instruments can focus on the craftsmanship and heritage of its products to appeal to musicians who prioritize authenticity, quality and tradition.
10. Leverage Digital Marketing Strategies
Any company that wants to operate independently of Amazon needs to bring direct consumer traffic to its own digital channels. A variety of digital marketing strategies can be used to enhance a brand’s online presence and attract more visitors to its site. Pay-per-click (PPC) advertising campaigns, for instance, offer one route to provide visibility and traffic. By targeting specific keywords related to their products and services, companies can create ads that appear to customers who are actively searching for related information. That said, PPC can be an expensive customer acquisition strategy, and it’s not uncommon for consumers to be wary of advertisements or experience “ad fatigue.” Companies may want to balance PPC with other methods that build trust and authority organically
Search engine optimization (SEO) is at the foundation of organically increasing a website’s visibility. By leveraging techniques, such as customizable headers, titles, meta tags, SEO-friendly URL links and schema markups, brands can improve their ranking in search engine results that drive traffic. Effective SEO strategies help companies to understand what information their sought-after potential customers are searching for, so they can provide relevant answers. SEO can help make sure that when customers search for keywords relevant to a company’s brand or offerings, the brand will prominently appear with useful information, increasing the likelihood of clicks and engagement.
Content marketing builds on SEO by providing valuable, relevant information that positions a brand as a thought leader in its industry. A specialty coffee company, for instance, might publish articles on the best brewing techniques or the origins of different coffee beans — an approach that not only helps with SEO but also engages readers and builds trust and authority in the niche.
Retargeting strategies can play a key role in maintaining brand awareness among individuals who have shown interest but haven’t yet purchased. These strategies can include displaying ads for previously viewed products, or sending personalized emails that offer additional information, a special discount or a simple “Forgot something?” note. Though effective in reigniting initial interest, it’s important to approach retargeting gently and with sensitivity. The goal is to increase conversion rates by reminding customers of what they’ve left behind; being overly aggressive will likely steer valuable prospects away.
Don’t overlook the power of social media, either. Endorsements from influencers and celebrities can extend a brand’s reach, especially when companies collaborate with those who share the same values and have a relevant following in their target markets. This is the key to the authenticity required to build credibility and desirability for products.
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Deliver a Superior Experience With NetSuite
NetSuite SuiteCommerce is engineered to help B2B and B2C merchants deliver engaging and relevant online experiences that help them stand out from the competition—even giants like Amazon. SuiteCommerce enables businesses to give their customers the intuitive, engaging and responsive online shopping experiences that they expect, on any device. With features such as advanced site search, product comparisons and customer reviews, SuiteCommerce helps shoppers find, learn about and purchase products with ease.
Additionally, SuiteCommerce natively integrates with core NetSuite solutions to provide a single source of real-time visibility into customer order information, inventory status and other critical data. This integration yields a seamlessly unified ecommerce, point-of-sale, inventory, order, marketing, customer service and financial management solution. By centralizing essential information on NetSuite, companies spend less time gathering data and more time differentiating themselves via supreme customer support, faster customer delivery and personalized, curated experiences.
It’s also worth noting that NetSuite can be useful for companies that plan to sell through major ecommerce sites, including Amazon, as well as direct to consumer. For example, NetSuite’s centralized repository of product data can quickly and easily be exported to selling platforms including Amazon and Google Merchant.
While Amazon excels in scale and efficiency, smaller businesses have plenty of opportunities to connect to consumers on a more personal level. Smaller, growing companies have the potential to thrive despite Amazon’s expansive influence by becoming recognized leaders in specific areas. Tactics include providing fast shipping and logistics and providing genuine, personalized connections based around a rich brand community and connections that go above and beyond what mass marketplaces can provide.