Protecting Your Buy Box For Black Friday
High-traffic days like Black Friday can mean huge revenue gains for brands or missed opportunities if you're not monitoring who else sells your product on Amazon. Unfortunately, with massive demand increases comes a flood of bad sellers looking to make your customer's holiday a real stinker!
Dan Brownsher, President, CEO and Co-Founder of Channel Key, joins the latest episode of Owning the Buy Box. Dan’s businesses have generated over 750 million dollars in Amazon product sales, and he is a national thought leader in successfully managing the Amazon sales channel. Channel Key helps provide a premium service for brands to understand and grow with their buy boxes.
We dive into:
- The 2022 Q4 environment for Amazon sellers
- How to protect the buy box and Black Friday revenue on Amazon
- Establishing an optimal selling model for the holiday season and beyond
Troubling waters ahead
Between upcoming Secret Santa, family gatherings, gift exchanges and staggering deals, sales are set to ramp up as we approach Black Friday and beyond. Increased Amazon traffic can mean sky-rocketing Amazon sales for your business, especially if you own the buy box. But, it also means increased opportunities for others to ultimately rob you of a significant chunk of your revenue.
While Q4 is a make-or-break time for businesses each year, 2022 presents a few unique challenges.
We’re currently in a recessionary environment. Plus, in response to the recent supply chain shortage, many businesses have over-corrected and purchased more stock than they can sell. Together, these factors may create the perfect storm, increasing the opportunity for new sellers to enter the market, pursue your customers and influence your brand reputation.
While consumers are expected to continue purchasing, there may be some tightened budgets this year. Additionally, many businesses may be looking to offload products, dramatically undercutting your prices.
While you should enter the holiday season prepared for increased MAP threats, new competitors and increased challenges, there are several ways you can protect your business and your margins.
Protecting the buy box and your Black Friday revenue
According to Dan, if you enter the holiday season unprepared, you’re likely to lose big. Fortunately, you can safeguard your success and decrease the likelihood of substantial loss with just a few precautions.
- Begin prep work in the third quarter
While the highest sales volume is likely to occur over a 15-day period, the prep work necessary for success must come far in advance to ensure your business is ready. Competition can quickly gain consumers' attention without proper preparation, claiming more significant portions of your revenue — even taking hold of the buy box.
“Most of the work for Q4 starts in Q3,” Dan says. “It started in August and it’s still happening now.”
Before you can see genuine growth and success, you have to:
- Ensure your product descriptions are optimized.
- Publish your listings and push your products live.
- Formulate and prepare sales and marketing strategies.
- Confirm your products are appropriately stocked.
- Take a proactive approach in protecting your channel
With an increase in new sellers entering the Amazon marketplace to unload overstocked items, it’s essential to ensure you have good policies in place before responding to resellers and gray-market sellers.
According to Dan, being proactive rather than reactive can make a huge difference, and it’s easier to tackle early on.
- Make brand protection a daily habit
Protecting the buy box has become routine for many successful sellers. But many opt for weekly or monthly monitoring. While this may pass as acceptable for most of the year, the increased threat during Q4 requires a more hands-on approach — without it, others will cut into your sales.
“You can be flying free and clear for your entire year with a clean buy box,” Dan says. “But there could be one person that decides to sell against you, on your listing, for your product, for your brand during that 15-day window. They could take half the product revenue.”
- Control your product flow and brand
Your approach to the high volume to come should be tailored to your business needs. But, according to Dan, it does need to be controlled.
“To grow the business, you've got to control it — the distribution, the buy box, all of these things,” he says. “A brand cares about how it’s built; resellers only care about transactions.”
If you cannot control the flow of your products and cannot maintain control of the buy box, it will be impossible to shape your brand, grow your business and create a great customer experience.
Deciding on a selling mode for your business, holidays and beyond
One of the most effective ways to control the flow of your products is to make the hard decision to sell directly to consumers.
While this mode isn’t for everyone, it can counter and recoup revenue lost to resellers. According to Dan, it is one major mode for controlling the platform when it comes to their own products and one of the most effective ways to create brand protection for their business.
There are two ways businesses can adopt this model:
- By selling direct-to-consumer (DTC) on Amazon through Seller Central.
- Adopting a vendor model where they supply products directly to Amazon.
In either case, a business takes better control of its product flow, ultimately limiting the amount of product available in bulk to resellers. This presents an opportunity to thrive through the end of Q4 and create a scalable business model.
“If I own the intellectual property and I'm getting first or second costs from the factory, making maximum margin possible and I control distribution, then I have a business with a strong, scalable foundation,” Dan says.
