For many brands we talk with, the sales world has been flipped on its head. Traditionally, before the age of Amazon, the predominant theory of sales and revenue growth was “more is better.”
In other words, brands had been conditioned to wander the streets searching for more and more retail outlets to carry their products: More sellers --> More sales --> More market share --> More revenue --> More profit.
What was so great for a brand just five or six years ago is now turning into an unmanageable nightmare online. Now more is not better. Now more means more sellers pushing subpar content on marketplace listings. Now more means more sellers - legitimate or otherwise - pushing prices down to win sales. Now more means higher chances that consumers receive damaged product.
What does this all mean?
Brands need a sales channel strategy. You would be surprised at the number of brands with which our work actually begins at simply formulating a plan of attack. Sure, we do content, advertising, brand protection, etc. for brands, but before the brand is even ready to invest in these efforts, there needs to be a strategy in place.
A Sales Channel Strategy Leads to Control
This comes in the form of sales channel control. By taking these straightforward steps - as arduous as they may be for larger, more established brick-and-mortar brands - you can avoid the chaos that entangles virtually every large brand these day online:
- Determine the marketplace approach that best fits your brand (based on factors such as industry, freight, margin, etc.). – Is the 1P approach best? Would splitting your catalog up across a few, trusted 3P sellers be ideal? Maybe only selling 2P through your own seller account is best.
- Craft and implement authorized reseller policies – This step is absolutely crucial to providing your brand with the legal foundation necessary to actually enforce on unauthorized sellers down the road. See our previous blogs explaining this vital process.
- Adapt your distributor agreements/provisions as necessary to ensure no leaks – Part of crafting the proper reseller program is also tightening up leaks that may be occurring through wholesalers and/or distributors. Getting transparency in their operations and prohibiting sales online by these middlemen without brand approval is key.
- Implement internal rules for your sales team – Policies are only as good as the compliance with those policies. If your reseller policies say one thing, but then your sales team is out at trade shows providing 25 percent discounts, free shipping, etc. The leaks and unauthorized sellers are sure to pop up.
- Craft and implement a proper MAP (pricing) policy – Once your ‘realm’ of approved sellers is formed, establishing a proper MAP (minimum advertised price) policy is essential to keeping a level playing field among your resellers. With this tacking on to your reseller program, you will be able to not only protect your sellers from rogue sellers, but also keep competition level and fair among your sellers.
All of these steps will combine to preserve margin, elevate your brand’s reputation, and protect your network of authorized resellers online.
If you’d like to learn more about how Retail Bloom partners with brands to protect their presence online, connect with our team of Amazon experts and schedule a consultation today.
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