Launching on Amazon.com: A Beginner's Guide for International Brands to Succeed in the US Market
Authors - Betsy McGinn, CEO/Founder McGinn eComm, Jeannie Stamberger, CEO/Founder The AmaZone & Meghann Urewicz, Managing Director The AmaZone
We launch and work with many international brands on their Amazon.com business, so we see the vast opportunity and the many steps that brands must take in order to make this dream a successful retail reality.
There is no doubt that launching on Amazon.com is a streamlined path to nationwide product distribution and consumer reach. It eliminates the need to secure a distributor, hire a broker, and pitch to a category manager at a specific time of the year to acquire placement. There’s no 6-month wait to get on the shelf once accepted or the limitation of shelf space itself where a brand may only get 2 or 3 SKUs placed at a given time. And there is no crossing your fingers and saying your prayers that you will have enough weekly sales to remain on that shelf by the next review period.
That said, there is never an easy path to market but there are distinct advantages that international brands have by launching on Amazon.com as their first-choice channel for the US market. Above, we mentioned a few but there are other advantages like no slotting and, most importantly, the ability to manage your Amazon business using Seller Central (Fulfillment by Amazon or Fulfillment by Merchant models) and use the given tools to maintain brand control in its competitive marketplace rife with 3rd party sellers.
That said, there are best practices that are essential for a successful Amazon.com launch, and while we are not able to dig into every single one of them, we’ll highlight a few that are especially crucial for new US Brands:
Understand US Regulatory Requirements for your products and category. This is probably the most important first step and requires research and expertise. While we are not regulatory experts, we place utmost priority on referring our clients to those who are prior to a launch.
Understand Amazon’s Seller Code of Conduct – We encounter situations where brands may inadvertently violate Amazon’s Seller Code of Conduct and suddenly their Amazon journey comes to an end with a suspended account. Know the rules – from limitations on communicating with customers, posting claims that skirt regulatory boundaries, to restrictions on promoting your own website – so you don’t encounter sometimes irreversible consequences.
Have your product warehoused and available in the US – In recent years, Amazon instituted inventory limits and continues to increase monthly storage charges, for the efficiency of their operation and to clearly convey to brands that Amazon is not a US warehouse. Even if Amazon is your only sales channel in the US, brands require a separate warehouse that ships products into Amazon’s Fulfillment Centers (FCs) as needed. From a practical standpoint, it was never an optimal solution to ship directly to Amazon Fulfillment Centers from overseas locations, as the likelihood of gaps in inventory and resulting out-of-stocks is one of the biggest barriers to growing an Amazon business.
Expect to Spend Money on marketing and advertising – Sadly, no matter how cool your brand is, there are no Unicorn Brands on Amazon. Success for innovative brands is hard won and the result of doing things right – from great content to right-sized budgets for on-platform advertising and promotional activities. It’s an “always on” strategy since your goals for an eCommerce endeavor are continual acquisition, conversion and repeat purchasing.
You Will Likely Need Help – Amazon is a complicated beast. Getting the help you need to “get it right” at launch and assure continued growth is pivotal to success. While still in the launch stage, it rarely makes sense to hire internal company expertise, so working with a well-qualified agency or independent contract may be the best money spent on your US journey.
Know your Competition – There is nothing wrong with learning from and modeling best practices of your competitors on Amazon. But be sure to know what those best practices are and who truly are your competitors on Amazon. It may be surprising since they are often not the same brands we classify as competitors in Brick-and-Mortar retail but rather young, creative brands taking the digital native path to market.
We love the opportunity that Amazon affords international brands and believe in its viability as a first stop for US market entry. It’s just a little more complicated for international brands. Making the right moves, in the beginning, will serve your long-term success!
