Amazon Seller’s Survival Guide—COVID-19 Edition

Most optimists would agree with me when I say that a setback is a setup for a comeback. In an uncertain time, Amazon sellers are all but comfortable as they see their sales volumes dwindling. COVID-19 may have that silver lining. Most industries are affected by the viral spread as sellers struggle to sell their products and to replenish their inventory. Safe to say that the toilet paper industry has experienced a pleasant surprise in sales.

Amazon’s response:

Amazon rolls out new regulations bit by bit and as of the writing of this article, we know that Amazon only allows replenishment of essential product categories:

• Baby
• Health & Household
• Beauty & Personal Care (including personal care appliances)
• Grocery
• Industrial & Scientific
• Pet Supplies

As a result, Amazon uses an influential strategy reserving their fulfillment channels for the delivery of essential products: pushing back the Amazon Prime guaranteed delivery date. On March 25th, a non-essential prime product had an estimated delivery date of April 22nd. This strategy acts as a deterrent and prevents consumers from clogging up the main fulfillment channels. Consumers will still buy what they need, they might receive it later than 2-days.

Shivam from the Amazon Customer Service team has chimed in by saying that “Because we cannot estimate how future conditions are going to be and how will we able to [source] the products from the seller and make them delivered to you, we are trying our best to get them delivered as soon as possible.” This means, that consumers might still receive your FBA products in a reasonable and shorter delay.

Shoppers’ response: Social distancing done right.

The initial panic has subsided, and yes, toilet paper is available for the next year or so. Shoppers were quick to dig into Amazon’s offerings and honoring social distancing by shopping from home. Roughly 87% of the top 100 search queries on Amazon.ca in the week of March 8th-14th had something to do with COVID-19. While most search terms related to toilet paper, masks, hand sanitizers and gloves (even a hazmat suit made the list), non-perishable foods and bidets were also in demand.

A market shift of this rapidity affects all non-essential products as attention has pivoted on items necessary to live out the self-isolation and tough financial times. There is also a spike in productivity from home, explaining a demand in home office electronics such as monitors, laptops, and accessories.

Advice for sellers: Do’s and Don’ts

All markets will eventually bounce back, and Amazon is no exception. Several hundreds of sellers are currently strategizing on their next move to win a bigger market share in the coming months. Unlike during the toiler paper crisis, this is the one time I recommend following the herd. Here are some critical do’s and don’ts you should focus on:

Do: Make sure your products are still in stock and aren’t perishing in the upcoming weeks.
Don’t: Worry about your non-essential product sales bouncing back up.

Stay informed.

Staying informed is a key survival tool in this business. Daily, various levels of governments, corporations, and policymakers announce or ease restrictions. Keep up to date via Amazon’s news outlet in Seller Central.

Do: Make a habit of scanning relevant news and abiding by new restrictions and policies.
Don’t: Ignore warnings as Amazon is swift to punish uncompliant sellers with a suspension.

Review your ad strategy

Spending money on Sponsored Ads is a pillar of a good sales strategy, but not when there’s nothing to support. PPC strategies work on a demand basis, and if there’s no demand, there will be no sales. This is a complex topic, and you can get certified to use Sponsored Ads by Amazon here.

Do: Adjust your budgets according to recent trends and focus on future Amazon Sponsored Ads strategies. Review A+ content and promotions.
Don’t: Increase your budgets during an uncertain time as conversion rates are quite low.

Boost that SEO

Amazon’s ranking algorithms are like Google’s; they are both search engines. Having a properly structured product listing increases the chances of ranking higher in organic search results and a customer purchasing your product. Oftentimes, sellers find this critical task tedious and end up procrastinating.

Do: Inform yourself on Amazon’s best practices and policies, review your titles, bullet points, photos, descriptive texts, and back-end information.
Don’t: Make false claims, especially concerning COVID-19 and the current global situation. Amazon are hawks when it comes to verifying genuine information.

Review your pricing strategy

Shoppers are conscious of their expenses in the present day. The right price may make or break a sale. Many sellers are revising their pricing strategy and they are right in doing so.

Do: Offer competitive prices. See this as an investment where a seller can absorb a lower profit margin in exchange for a long-term higher seller ranking. A higher-ranking drives more organic sales, thus lowering reliance on ad expenditure.
Don’t: Gouge prices, especially for products in the essential category. This is unfair and policy-violating behavior.

Leverage data to forecast sales

As the market for non-essential products ends its self-isolation, I urge all sellers to be ready, as I assure you that the competition will be ferocious. Popular products will regain their demand and there will be dozens of third-party sellers competing for every marginal sale.

Do: Streamline your logistics, prepare a shipment plan, and properly forecast demand based on historic sales data. This way you’ll avoid long-term storage issues.
Don’t: Expect organic sales to immediately come back to the same volume as pre-COVID-19.

Use social media

Facebook and Instagram are being hounded right now by stay-at-home responsible self-isolating citizens. Social media communications, if used wisely, can boost your brand-awareness using little to no investment.

Do: Take this time to build and communicate with your fanbase and to optimize your social media business presence. It’s free!
Don’t: Inject large amounts of money in ads; boosted posts on Facebook are just fine.

Temporary engagement in FBM

As I mentioned above, Amazon wishes to keep its fulfillment channels clear for essential products. This may bring up some frustration for your customers, especially repeat buyers.

Do: Explore the Fulfilled by Merchant (FBM) option. This alleviates stress on FBA and makes your products readily available. Furthermore, some sellers qualify for Seller Fulfilled Prime; a fantastic alternative.
Don’t: Recall your products from FBA warehouses to sell them as FBM, this will waste time, resources and money.

Take this learning experience

A global crisis such as COVID-19 served as a harsh reminder of how rapidly our environments may take a turn for the worst. Focusing on the positive, I appreciate the lessons we’ve learned as business owners for any future turmoil.

Do: Prepare a long-term business strategy with contingency plans in case of global crises.
Don’t: Think this is over, as markets will most definitely take months to recover.

Take action now

It’s nearly impossible to predict and adjust perfectly to today’s reality, which is why several resources exist for sellers, ranging from support forums on Amazon Seller Central to expert consultants for hire.

Do: Contact an expert in the field for advice or management of your account. At Reptile, we specialize in well-beyond digital marketing and Amazon Seller Central management.
Don’t: Wait for his to blow over as other sellers are likely preparing for a market bounce-back with marketing offensives and restocking logistics.

Final thoughts

Amazon has become a lifeline for many business owners and my heart goes out to sellers currently affected (not you, Charmin). With a combination of optimism, preparation and proactivity, I foresee many sellers coming out stronger out of these hard times. After all, every setback is a setup for a comeback!

Michel is also an instructor at Infopresse and his course for Amazon Sellers is available in english.

2nd photo credit: Evgeni Tcherkasski

3rd photo credit: Mick Haupt