The Marketer's Guide to Amazon - A report by Sellwin, a dentsu company
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The Marketer’s Guide
to Amazon
A report by Sellwin, a dentsu company
03 STATE OF ECOMMERCE
The Dominance of Amazon 4
05 MAXIMIZE REVENUE
ON AMAZON
TABLE OF CONTENTS
Build Foundations 6
Assess Brand Health 7
Activate Advertising 11
Measure & Optimize 17
22 WHAT’S NEXT
Commerce Innovation
2
STATE OF ECOMMERCE +
2020 was the biggest year for ecommerce to date
In fact, ten years of growth were achieved just in three months. Companies with
embedded ecommerce practices were best able to quickly pivot and capitalize on the
opportunity.
U.S. Ecommerce Penetration, %
Source: Bank of America, U.S. Department of Commerce, ShawSpring
33
10 years’ growth in
3 months
Research, Forrester Analytics, McKinsey Retail Practice
16
14.4
13.2
11.8
10.7
8.8 9.7
7.2 8
5.6 6.4
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20-Apr
U.S. shoppers learned new behaviors and even lagging ecommerce categories saw a
boost. Online grocery sales were estimated to grow nearly 53% in 2020 as consumers
gravitated to the convenience and safety of online ordering. 43% of consumers tried
curbside pickup for the first time, highlighting the evolving role of brick-and-mortar
stores in the omnichannel approach to commerce.
Back-end ecommerce infrastructure moved to center stage. Retailers will continue to
invest in supply chain enhancements, to best fortify their position and protect against
future disruption.
Online pharmacy is the category to watch. Amazon Pharmacy launched in November
2020, two years after Amazon’s acquisition of PillPack for $753MM. Amazon is jumping
into the fray of online and mobile prescription ordering and fulfillment services, a highly
competitive space led by traditional brick-and-mortar retailers like CVS, Walgreens,
Walmart and Target. 3
STATE OF ECOMMERCE +
In a year of economic instability, Amazon cemented
its dominance in ecommerce
Amazon became the go-to destination for consumers to shop safely and reliably as the
pandemic accelerated overall ecommerce growth. Investors noticed as well with the
Amazon stock price skyrocketing to $3,275 by year end, up +76% from January. After
delivering its largest quarter of all time in Q4 2020 at $125.6B, Amazon continues to
project historic 2021 numbers across its retail presence, AWS and Advertising
businesses.
U.S. Top 10 Retail Ecommerce Sales Share
Amazon 39.0%
Walmart 5.8%
eBay 4.9%
Apple 3.5% $386.1B
Amazon
The Home Depot Sales
2.1%
Amazon’s strength is in its infrastructure and logistics network that is constantly
improving speed-to-customer delivery and building ever stronger loyalty and
dependency. Within the past five years, Amazon has quadrupled its warehouse count,
with a 61% year-over-year increase in number of warehouses in 2020 alone. This logistics
network will not only improve last-mile functionality but expand product category
availability as well.
*Amazon Advertising grew 64% YOY in Q4 alone, climbing to $21.5B in ad revenue
for FY 2020 and stealing share from the Google/Facebook duopoly. Amazon’s portfolio
has grown significantly from on-site sponsored advertising to lucrative media channels
like Fire TV, Twitch, Kindle, Alexa/Audio, Display and Video DSP as well as new ad units
launching in 2021. Even non-endemic brands are cashing in on Amazon’s rich audience
data, proving you don’t have to sell on Amazon to succeed with Amazon.
*“Other” Category within earnings, widely perceived as Advertising
+
Maximize revenue on Amazon:
Our approach
BUILD SOLID
FOUNDATIONS
Establish operational best practices to fuel a
successful and profitable Amazon business:
• Sellwin Ecommerce Audit
• Policy & Pricing
• Retail Readiness
• Brand Stores
ACTIVATE
ADVERTISING
Deploy a full-funnel media strategy: attract,
engage, convert and retain
• Scalable across diverse portfolio of media
channels
• Deterministic first party data powers audience-
based strategies
MEASURE &
OPTIMIZE
Access and analyze rich data sets:
• Amazon Retail Reporting
• Advertising Reporting & Insights
• Amazon Marketing Cloud
+
Build Solid
Foundations
Back-end operational efficacy is foundational for driving
long-term success. Amazon is a vast and complicated
marketplace and focusing on critical business elements is a
worthwhile investment.
An audit of your current brand presence is a strong starting
point no matter where you are in your journey: just starting
out, preparing to launch products in a new category or
simply wanting a refresh.
.
BUILD SOLID FOUNDATIONS +
Success starts with a Sellwin Ecommerce Audit, an
actionable report that assesses your brand presence
ADVERTISING
• Sponsored Ads
• Share of Shelf / Share PRODUCT DETAIL
of Voice PAGE
• Media efficacy • Copy Review
• Buy Box Improvement
• Reviews & Ratings
SUPPLY CHAIN
• Inventory
Performance FINANCIAL
• Demand Forecasting • P&L Assessment
• Price Sensitivity
• MAP Violations
CREATIVE
• A+ Content INNOVATION
• Brand Stores
Maintaining competitive
• Image quality and advantages
video usage
• Driving Incremental
commerce opportunity
• Testing & betas
• Research & Insights
Our audit suggests recommendations for improvement, analyzes the level of effort required and
anticipates the impact of each change. To request an audit for your brand, contact us at
hello@sellwinconsulting.com.
BUILD SOLID FOUNDATIONS +
Create strong policies around authorized sellers and
pricing
Authorized Sellers
Who can sell your product?
Amazon is a vast marketplace with a large and complex grey market. For
that reason, many brands fear brand dilution from resellers and how it
can impact customer experience. We suggest implementing authorized
seller policies, which include an understanding of possible business
names and websites that chosen sellers can operate on. The goal is to
limit distribution of your brand’s product and create a legal foundation
to protect your brand and clean up the distribution channel.
MAP (Minimum Advertised Price)
At what price can they sell?
A good research starting point will be to assess the
competitive landscape to set the optimal MAP policy across
retailers and selling partners. While Amazon (as a retailer) does
not recognize MAP agreements for most brands, a strong
policy to authorized sellers will prevent pricing violations on
grey market goods and provide a defensive strategy in case
you need to pursue legal action.
BUILD SOLID FOUNDATIONS +
Perfect your product detail pages
As customers on Amazon, we’ve all come across detail pages that offer terrible shopping
experiences. Lack of information, misleading or confusing images or out-of-stock items
result in customers being unable to complete their purchase.
Even among seasoned brands and sellers, there’s a huge opportunity to improve the
detail page experience. This concept of digital merchandising is known as Retail
Readiness and it’s necessary for any seller or brand on Amazon to launch product and
advertising campaigns successfully.
Components of Retail Readiness
Product Detail Page Content
• Relevant titles, SEO-optimized copy and clear
product images
A+ Content
• Enhanced branded content on a PDP, created
through self-service tools
Inventory
• Maintain 95% in-stock rates to win search
algorithm and Buy Box
Buy Box
• “Win the Buy Box” through Prime offering,
pricing and inventory
Customer Reviews
• A PDP must have 15 verified customer reviews
to promote products
Star Ratings
• A 3.5-star rating or above is ideal
Click here to see a comprehensive guide to Retail Readiness on our website.
BUILD SOLID FOUNDATIONS +
Maximize your Amazon Brand Stores
Brand stores are an equally important complement to the PDP, representing a virtual,
multi-page storefront on the Amazon website. They are created through a free, self-
service tool that allows brands to tell a unique, branded story and stand out from
competition.
Stores allow brands to:
Utilize branded rich content to highlight product and collection features
Generate new traffic sources for the brand and increase organic ranking
Create a multi-device experience across desktop and mobile
It’s important to note that stores are only available for vendors and sellers enrolled
Amazon’s Brand Registry. This program enables brand owners to control their product
listings and content and improve the customer shopping experience. In addition to Brand
Stores, Amazon’s Brand Registry unlocks multiple marketing and advertising
opportunities like A+ Content, Sponsored Brand tools, Amazon Brand Analytics and
more.
Click here to see Amazon’s Brand Registry, Explained on our website.+
Activate
Advertising
Amazon is forging aggressively ahead with their plans to
dominate digital advertising market share. Ecommerce media
spend is one of the fastest growing categories and Amazon is
leading the charge. Brands can leverage Amazon’s reach,
unique platforms, impactful formats and unmatched shopper
audience data in impactful ways both online and offline.ACTIVATE ADVERTISING +
A great Amazon strategy covers every step in
the consumer journey
AWARENESS
C O N S I D E R AT I O N
PURCHASE
L O YA LT Y
It’s important to develop a full-funnel
strategy. Performance works best when supported by
branding and every performance ad reinforces and
shapes how customers perceive the brand.
There is more in-depth information about this on our website.
Check out Mastering Your Media Strategy: Why Amazon is So
Much More than a Sales ChannelACTIVATE ADVERTISING +
Amazon’s predictive data helps brands reach
consumers across the funnel
AUDIENCES
AWARENESS
Mass Reach or In-target demographic
but not browsing products or category
Have browsed category but have not
CONSIDERATION browsed or purchased brand products
PURCHASE Have browsed products but not purchased
or subscribed
LOYALTY Currently purchasing but not subscribing
The importance of building a
data-driven audience strategy
Defining audiences is critical. The biggest benefit to advertisers is Amazon’s ability
to capture customers’ behaviors across the Amazon ecosystem. This rich, granular
data creates opportunities to reach and acquire new customers, serving relevant
ads wherever they are in their shopping journey.
Conversion is important but a sole focus here limits your overall market potential
and scale. Stay true to KPIs by stage and resist the urge to solely optimize to the
lowest efficiency metrics. Brands should build an overarching audience strategy to
be successful at multiple stages of the funnel.ACTIVATE ADVERTISING +
Amazon’s diverse media portfolio reaches
consumers across platforms and devices
Here’s how brands can
activate across the
Amazon ecosystem:
Amazon.com
• Sponsored Ads: Sponsored
Products, Brands and Display (est.
70% of Amazon’s ad revenue is
spent here)
• DSP: Display & Video Advertising
• Custom Display & Share-of-Voice
Takeovers
• Content: Stores, PDPs & Post
Owned Media Properties
• Fire Devices: OTT & Tablet
• IMDBtv, Live Sports (Thursday
Night Football,
Premier League, etc.)
• Audio Ads – Amazon Music and
Podcasts (Wondery acquisition)
• Alexa/Voice Integrations
• Experiential & OOH: On-box Ads,
Treasure Truck, Pop-ups & Lockers
• Custom Advertising:
Campus/Events, Amazon Go Stores
• Twitch/Gaming
• DSP: Amazon Publisher Services
(APS) & Third-Party ExchangesACTIVATE ADVERTISING +
Bring meaning and intent to your ads as Amazon
innovates this space
Dynamic Ecommerce Ads
Bring in native product detail elements and dynamically
optimize to users based on behaviors. Examples: 40%
coupon for deal-seeker, review creative for researcher
and add to cart for shoppers ready to purchase.
Machine Learning
Looking ahead, the new dentsu partnership with
VidMob can enable enhanced optimizations when
evaluating creative elements beyond what’s available in
the Amazon reporting platform.
Voice Actionable Ads à
Interactive Ads
“Alexa, add Celestial Seasonings to my cart!” Voice
actionable ads include calls to action that prompt the
consumer to engage with Alexa.
Shoppable Video
An extension of dynamic ecommerce ads, Video
Creative Builder creates 15s video assets using pre-set
customizable templates; allowing for customized
imagery, verbiage and featured ASINs.
Amazon Live consists of both editorially driven live
show programming and self-produced content that
sellers can directly upload. All livestreamed videos are
also shoppable and include the products featured
directly below the video feed.ACTIVATE ADVERTISING +
Deterministic data fuels the flywheel in the
Amazon ecosystem
A persistent ID uniquely allows Amazon to find audiences across devices and
platforms. With their logged-in ecosystem, Amazon is well situated for the coming
deprecation of the third-party cookie and insulated from Apple’s upcoming ad privacy
policy changes.
Entertainment:
Video, Music, Books
Shipping,
Voice Interactions
Location and
Credit Card
Information
Shopping
Behavioral Amazon
Patterns Garage
Clients can also leverage dentsu’s market-forward identity solution
called M1
Our people-based identity platform that allows for the targeting of over
242MM U.S. individuals. Brands can enhance their first-party audiences
onboarded into Amazon with M1 attributes, upload standalone M1
audiences into Amazon or layer M1 attributes on top of existing Amazon
data. This pairing unlocks exciting targeting capabilities and allows
brands to test and learn from data-driven audiences in actionable ways.+
Measure &
Optimize
Amazon is known for its robust data capabilities and brands
selling to Amazon can benefit from its rich data sets. Sales
reporting may differ depending on how a brand sells (Vendor
or Seller) but advertising metrics are standard, available
directly in console or through API partnerships.MEASUREMENT & OPTIMIZATION +
Amazon’s selling portals offer retail insights to help
brands drive strategy
Traditional retail reporting is available to assist with sales and inventory operations.
However, the reporting metrics differ across Vendor and Seller Central to cater to the
specific methods of fulfillment and how the business is managed.
The reports are vast in number but some examples are below:
VENDOR CENTRAL SELLER CENTRAL
1P 3P
• Product Catalog • Business Reports
• Sales Diagnostics • Traffic Reporting
• Net PPM (Pure Product • Fulfillment Reporting
Margin) • Order History
• Forecast & Inventory • Customer Concessions
Planning
• Inventory Health
Amazon Brand Analytics
Amazon Brand Analytics (ABA) provides valuable insights on customer data and trends
across Amazon.com. To receive ABA, brands must first be enrolled in Amazon’s Brand
Registry program, designed for trademark owners only. Brands will receive the below
reports, whether you’re selling on Vendor or Seller Central:
Geographic Sales
Search Terms
Data
Market Basket Repeat Purchase
Item Comparison
Analysis BehaviorMEASUREMENT & OPTIMIZATION +
The Amazon Advertising console leads in real-time,
actionable reporting to advertisers
Amazon empowers brands to better understand campaign performance for insights and
optimizations. Whether a brand is solely running in Sponsored Advertising or taking
advantage of opportunities across the funnel, there’s a full suite of reporting capabilities
available.
Closed Loop Reporting
Tracking front end media spend and metrics to sales in real-time. Unique
reporting variables include:
Purchase Consideration Awareness
• Average cost of sale (ACoS) or • Cost-per-Click (CPC) • Reach
Return on Ad Spend (ROAS) • Cost-per-Detailed- • View Views
• Promoted/Brand Halo Sales Page View (CPDPV) • Brand Lift/Purchase
• Purchase Rate • Branded Searches Intent (3P Measurement)
• New to Brand Rate
Interactive Dashboards & APIs
Allows brands the flexibility to view and understand performance and traffic
sources:
Sponsored Ads: Offers real-time reporting and optimization abilities in console. Brands can
choose to leverage the API to utilize bid management platforms to optimize more
effectively.
DSP: Real-time reporting and optimization in console; bulk reports and API available
Brand Store Analytics: Gain insights into overall traffic, sales, page depth and sources for
brand store activity that is available within Sponsored Ads Dashboard.
Amazon Attribution: Free beta measurement solution that allows brands to measure non-
Amazon campaign impact on activity and sales on Amazon, now available via API.MEASUREMENT & OPTIMIZATION +
Amazon Advertising Reporting & Analytics
Third-Party Measurement
Leverage external reporting and research to validate performance beyond
Amazon KPIs.
Major brands rely on third-party measurement studies when evaluating the success of their
campaigns:
Brand Effect Offline Sales Lift Location-Based Marketing Mix
Studies Studies Foot Traffic Analysis
Audience Reports & Insights
Access to audience data has advanced planning across all channels by providing
advertisers with rich customer insights.
These audience reports are valuable for pre-planning, defining targetable audiences and
campaign optimizations:
• Overlap Reports: Learn shopping behaviors and discover audiences for targeting
• Audience Segmentation Reports: Optimize audiences within your campaigns
• Audience Insights Beta: Understand your audience demographics, temporal and
buying behaviors vs. competitive set
• Audience Insights Premium (AIP): Deepen knowledge of customer through custom
analysisMEASUREMENT & OPTIMIZATION +
Amazon Marketing Cloud
Holistic Measurement & Analytics Solution
Finally, the data has been unlocked. Amazon is providing access to robust and rich
data sets for brands to do their own modeling and customized analysis.
The Amazon Marketing Cloud (AMC) is Amazon’s cloud-based solution for marketers to
enhance analysis and insights. AMC is a flexible and privacy-friendly environment,
powered by Amazon Web Services (AWS).
AMC provides access to event-level data to help clients and partners pull customizable
reporting for their brands and to understand more detail across the consumer journey.
Use Cases
Advanced Audience
Reporting Insights
Supply Privacy-Safe Path to
Transparency Clean Room Conversion
AMC is best for advertisers with the following:
Complex brand Overlapping Omni-channel Regional variances
portfolio audiences media strategy & approaches
& activations+
Commerce
Innovation
Consumers will expect brands not only to solve
their problems but anticipate them in real time.
Commerce will be everywhere and truly
omnichannel and media innovation will be
powered by new technology and data sources.COMMERCE INNOVATION +
Advancements in technology make shopping
experiential, adding new data sets and behaviors for
audience reach
5G & Frictionless Shopping
Creating and normalizing Augmented/Virtual Reality and AI in-
store and online
Technology like AR/VR is only as good and fast as the connection available. The
expansion of 5G allows retailers to build infrastructures necessary for highly
interactive transactions. Major retailers such as Walmart and Amazon have already
introduced in-store and voice shopping assistants, adding layers of branded content
accessibility to audiences at mass.
Technologies to watch: “Just Walk Out” from Amazon, Intelligent Retail Lab by
Walmart
Humanized Data
Moving from transactional to behavioral data (reading emotions,
biometrics, accessibility) across devices and experiences
Affective computing allows for emotion-sensing technologies within devices,
creating actionable insights for brands to understand how consumers make
decisions i.e. interpreting stress signals, confusion, sleepiness, inebriation. As a
result, content and interactions can adapt and be proactive to real-time customer
needs.
As voice-activated devices are becoming a norm in households, AI-driven speech
recognition will power voice advertisements and interactions with skills. Voice
technology is quickly adapting to unique voice recognition and can adapt to
multiple user profiles on a singular device.
Technologies to watch: In-cabin Sensing by AffectivaCOMMERCE INNOVATION +
Customers will not only hold brands accountable for
ethically responsible product but also shift loyalty to
those who align with their values
Responsible Commerce
Building trust with consumers who care about environmental and
social footprints
Consumers are increasingly making ethically-minded shopping decisions,
assessing every aspect of the retail experience, from product sourcing to final
consumption. Retailers and brands adopting ethical practices can ensure quality
control and testing standards are matched directly to sustainable claims. As a
result, brands will highlight responsible claims from source to store through
marketing activations (e.g. QR codes on product packaging), displaying a fully
transparent supply chain to the customer.
Initiatives to Watch: Amazon’s Climate Pledge Friendly program
Digital Representation
Inclusivity and representation of audiences across brand campaigns and
advertisers
Brands and retailers will prioritize historically under-represented audience
segments. Major retailers such as Amazon and Walmart started accepting
SNAP benefits online in 2020 and both are aggressively launching healthcare
initiatives to address low-income and uninsured populations. Ulta and Apple
both made commitments to racial equity and implementing diversity
initiatives across leadership.
Brands, retailers and advertisers must ensure campaigns are authentic and
empathetic to meet the needs of these intended audiences. Advertisers will
have to address their own workforce diversity and representation while
considering the voice of the customer.
Programs to Watch: dentsu’s The Code and Female FoundryThank you.
linkedin.com/company/sellwin
@sellwin
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