Last Updated on March 8, 2021 by Filip Poutintsev
Amazon is one of the most widely used e-commerce websites. It has millions of users that make billions of transactions every year. It is a great platform to be used for selling your products because it is known and trusted by users across the globe.
There are some downsides to using Amazon to sell your products. The pros and cons have been discussed below.
Advantages of Self Selling on Amazon
1. Existing Customer Base
The biggest step in starting an online business is creating a customer base. This takes a lot of time when you have your own separate website. Amazon takes care of this.
There are over 250 million active users on Amazon from all over the world. This is especially great for start-ups and small businesses because this kind of customer base is extremely difficult to create.
2. Instant Credibility
Buying from a small business or a start-up is not always easy as a consumer. You question whether or not the products are any good or if the payments are a scam. Since Amazon processes the payments to distribute to the vendors, customers seem to find it comforting.
This comfort that Amazon provides the customers gives the vendors credibility that would require years to earn.
3. Customer Service Issues Handled Internally
One of the biggest issues with starting an online business is dealing with customers and their issues and complaints. This could get hectic when you are just starting.
If something happens to an order, Amazon is responsible for handling that order. They process the returns and handle the order fulfillment.
4. Lesser Technical Issues
Amazon has a phenomenal uptime. The site is always up and available in every country that you can think of. To you as a vendor, this means that you don’t have to worry about your products not being able to be searched by people in a certain area or the downtime affecting your sales. This could save you thousands of dollars annually.
Disadvantages of Self Selling on Amazon
1. Competition
There are over 100 different brands on Amazon. When a customer searches for a product, all those brands that have that product are listed. Your product might not necessarily be at the top of the search so naturally, your sales might decrease. The competition is a lot more than when you have an individual website.
2. No Access to Customer’s Information
Every customer that buys your product from Amazon leaves their information like name, address and email address but you don’t have access to it since Amazon process the order. On your part, this could mean that you will not be able to send your customers additional marketing efforts. As a result, it could cost you a few sales.
You could get access to their shipping address but sending a mail to these locations will cost you and it might not be worth it.
3. Competition for Similar Products
When you’re selling products on a platform like Amazon, there is a good chance that there are a few other brands that sell the same product. There is a lot of competition but lesser individual brand awareness. This could make it next to impossible for you to get your foot in the door.
4. No control on Product Reviews
It is normal for a product to have reviews. The customers that leave these reviews base their feelings on the actual product but it is also normal for them to base their feelings on the time of delivery or quality of service provided by the vendor.
It is not unusual for a seller to purchase or encourage good reviews from customers since negative reviews affect the sales of that product. Selling on Amazon could take this ability from you.
These advantages and disadvantages of Amazon show that it could be the right place for you if you are a small vendor or a start-up. It could give you access to the customer database that you need and give your business a boost. If you are a bigger business, Amazon might not be the right path for you to take.
