With many new brands we work with, we approach them with data about how their customers are being price-gouged online, simply due to the fact that the brand does not have an online sales strategy or sales partner.
What happens to you brand without a strategy and strategic partner?
1) Online sellers identify your product in stores, like Target, Walmart, or other major retailers. They think, “hey, let me try and resell this product online!” So they purchase a few of your product in the store, warehouse the product in their basement, create a sub-par Amazon listing (often with just a blurry homemade image and a lazy product title and product description), then start selling it for three times the MSRP. Thus, they have begun the process of “retail arbitrage,” one of the most prevalent sales strategies on Amazon, eBay, and Walmart.
2) Other online resellers use software to scan websites such as Target and Walmart, and your products pop up in search results as profitable products to sell. More sellers start buying your product in-store or online, and begin reselling the product alongside the original reseller.
3) Price competition, due to multiple sellers competing, often reduces the price, which creates more sales, but still at a price much higher than MSRP.
4) If the product gets marginally popular online, your brick & mortar stores start becoming upset when their stock keeps getting sold out online or in-store, especially while they run a “loss leader” sale to drive customer traffic. This results in brick & mortar stores complaining about stock-outs, online re-sellers ruining the product, or being unable to compete with Amazon listings if the product is not on sale.
5) You risk losing brick & mortar customers, all the while eroding your brand image since customers are over- or under-paying for your product, while not getting a consistent and professional impression of you brand due to poor product photography, inaccurate descriptions, and no marketing strategy.
So how do we fix this extremely common problem?
The answer is simple…partner with ONE online partner you can trust. The advantages of this are numerous:
Your product sells at the price you intend. That is, your MSRP or MAP.
Your brick & mortar customers are happy that their sales issues with your products are resolved
The online presentation of your products is professional, compelling, and consistent
The value of your brand increases as sales multiply online since your products are selling at a lower price than retailer arbitragers can manage
Your customers are happy they can purchase products on Amazon at the intended price
Customers can rest assured that they will receive a quality product that is not expired, improperly stored, or damaged
Your online distribution is controlled and drastically simplified
Having a coherent online strategy with a trusted partner is a win-win-win for your brand, the customer, and your online partner. Please feel free to contact us to discuss how we can help your brand with all of these opportunities.
