6 Brutal Startup Mistakes that Can Kill your Amazon Business Strategy

The Amazon Marketplace has proven to be highly prosperous to many people who become Amazon Sellers. While success is completely possible, it doesn’t come easy. Just as with any business, owners must invest their time and be fully dedicated to succeed. It may be a hard pill to swallow, but the truth is that most of the businesses that fail do so because of the owner’s flaws — this same concept goes for businesses selling on Amazon.

Every business owner wants to watch their company grow and flourish. When starting up a new business adventure, it can be helpful to look at a list of things you shouldn’t do. With that knowledge, you will be equipped to focus on creating a formula full of actions that will drive success (instead of failure) to your doorstep. Here’s our list of five things you should avoid when starting and managing an Amazon business:

1. Failing to Treat your Amazon Business as a Real Business

Sellers are able to benefit from Amazon’s giant Marketplace. The popular online retailer already has massive amounts of traffic, and the platform is straightforward to use. In most regards, selling on Amazon is easier than starting from scratch and going at it alone without massive website traffic or the marketing budget to get it. However, not treating your Amazon Seller account as a true business is a mistake that a lot of Sellers make when they first start off. Those Sellers quickly fall behind and die off. Amazon may be relatively easy, but it still requires a lot of work. The Sellers who are able to build, succeed and grow are the ones that realize they have a true business to run and can’t just click upload and go. You will have to put in the effort to learn and adapt your Amazon business practices over time as your selling grows — just as any other business would.

3 Tips for Amazon Businesses to Succeed:

Here are a few tips to treat your Amazon Marketplace business as a real business venture and give it the attention it deserves:

  1. Never neglect the importance of planning. Every successful business has laid out a plan of attack, and your Amazon business is no different. Long-term planning and focused goals are the things that will set your Amazon account apart from the vast amount of sellers out there right now. Put together a solid business plan and go after a targeted audience instead of just a product.
  2. Understand how Amazon works. Don’t treat your Amazon business like eBay or Google. Amazon is fundamentally different. Do your homework and align your business strategy with Amazon’s policies so that you get the highest return on investments as possible.
  3. Avoid taking shortcuts in the same way you would avoid the plague. If you think that you can play catch-up to your competitors by taking shortcuts, you are already at a huge disadvantage. Start small and put specific processes in place from the beginning. Your business may be small now and function without a precise process, but if you take shortcuts, you are failing to envision a larger (and more prosperous) business in the future.

2. Failing to Include Relevant Keywords in your Product Listing

If you thought search engine optimization (SEO) practices didn’t apply to Amazon, you are probably losing out on a lot of customers. By optimizing both the title and description of the products you are selling, this will ensure that customers will find (and buy) your product.

Use the following SEO tips to boost your Amazon product listing and generate more sales.
Important SEO Product Optimization Tricks:

  • Use your product title to explain exactly what the product is all about. Don’t leave your potential customers guessing. Spell it out for them.
  • Refrain from using offers or incentives in your title. Stick to the basics — what your product is and how your customer can use it.
  • Use all allotted space in your product description and use keywords to describe your product. The more information you can give your customers, the better they will understand exactly what your product is and why they should buy it. Your description should include key features such as type of product, what it includes, dimensions, color, age group, or who it targets such as women, men or kids. Also remember to include separate pictures for products and name image files with target product keywords.
  • Utilize free resources such as Google Adwords Keyword Planner to help you find the words that people are actively searching for.
  • Check out your competition and analyze their product descriptions for ideas you can incorporate. Do not copy, but incorporate best practices.

3. Failing to Focus on the Customer

In the Amazon Marketplace, your customers have choices. They do not have to choose to buy from you. What makes a customer buy from you (and return to buy again in the future) is excellent customer service. If you are failing to focus on the customer, you are failing your business. It can be tempting to spend all of your time and energy on your product, but without buyers, you will not be in business for very long.

Here are four tips to focus on customer purchasing from you on Amazon.

Customer Retention Rules:

  • Listen to your customers. If your customers have feedback, don’t brush it off. Make use of both positive and negative product reviews. Respond to every email. Fix any issues customers are experiencing. Why? Because your customers are who will ultimately make or break your business.
  • Build your customers’ trust. When they have issues, help resolve them even when your business is not at fault. You should genuinely care that every person that purchases your product is happy with it because your business name is at stake. People that trust you and your business will become your loyal and sustainable customers. Just because Amazon is a massive online marketplace that can feel disconnected from a personal experience, don’t make the mistake of creating an impersonal experience. The people shopping on Amazon are still real people who like genuine customer service.
  • Show appreciation to your customers. To most people, small things matter the most. Small gestures of appreciation go a long way. A short personalized thank-you note can make a customer come back over and over again. A follow-up phone call, a birthday or holiday card or a simple loyalty program are all easy to implement and won’t cost you much as the business owner, but they could create lifelong customers that will refer you to friends and family time after time.
  • Failure to provide great customer service can cost you your entire business. People talk. People read reviews. One bad piece of feedback can haunt you for years. While happy customers may tell one or two people, unhappy customers will tell anyone and everyone that will listen.

4. Using a Derivative Business Model

Many businesses are imitations of other businesses. Someone sells a product or provides a service that does well, and others start to copy it. While many markets can handle a small amount of saturation, the Amazon Marketplace isn’t one of them. If you try to copy someone else’s product or business (especially if Amazon owns or sells the product), you are setting yourself up for failure. The more original your product and business model is on the Amazon platform, the more your business will stand out from the competition.

5. Using Low-Quality Images

If you are using low-quality images for your Amazon product listing, you are going to appear unprofessional and the product loses credibility. You cannot expect customers to spend their hard earned money on products that . If you want to succeed with your Amazon business strategy, you will need to appear professional in all aspects of your marketing. Remember that pictures are worth a thousand words.

Keep these additional four tips in mind when sourcing images for your Amazon store.

Image Optimization Tips on Amazon:

  • Do not use the original manufacturer’s pictures of your product or snap a quick, low-light picture with your cell phone. Doing so will scream “amateur” to your customers.
  • Take high-quality pictures of your product from multiple angles. Professional photos will help you stand out from your competitors. You want your customers to visualize your product and how it would fit into their lives. This can still be done with a cell phone! Just follow tips to ensure your cell phone pictures come across professional, not amateur.
  • Post one picture of a consumer using your product. This picture will give your customers an idea of size, usability and quality of your product.
  • Ensure that your images meet all of Amazon’s product image requirements to avoid penalty.
  • Add a file name for your image, which is the targeted product keyword for your image.

6. Running out of Inventory on Amazon & Missing Out on Sales

It should be obvious, but without an inventory, you will not be able to sell your product. Not only will your sales go to zero, but Amazon will “ghost” your listing as soon as your product page shows “currently unavailable.” Your rankings will plummet. Inventory management is essential to your success as an Amazon Seller. If waiting several weeks for your Amazon payout is hurting your ability to keep inventory in stock, consider a savvy alternative so you have working capital to use for inventory purchases in advance to receiving your Amazon payment.

Replenish Inventory Faster with Payability

You can use Payability to receive faster payments on Amazon — the next day or on a weekly basis thanks to Payability Instant Access for Amazon Sellers and Payability Weekly Payments for Amazon Vendors. You don’t have to wait to order inventory as you will receive your earnings daily or weekly so you will have the capital you need, depending on type of program.

From the outside looking in, running an Amazon business might appear to be an easy way to sit back and watch the money roll in. In reality, the owners of those businesses are taking chances and accepting risks every single day. Many businesses fail on the Amazon platform by making simple and avoidable slip-ups. If you are interested in selling on Amazon, there is one thing that you can do to help ensure your success: limit mistakes and make smart, calculated choices.

Alison Sperling
Alison is the Director of Marketing at Payability. She has 10+ years of experience in marketing helping small businesses and startups find new tools to grow their business. Prior to Payability, Alison started the marketing team at Stack Overflow. Alison completed an MBA with a concentration in Finance from Syracuse University in 2011. She volunteers with several cat rescue organizations.

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