Marketing on Amazon resembles a game of poker in 2020. You bet, you win, you lose. You can get fantastic wins and you can generate losses. It all depends on your agility, and on who else is playing at your table. And there tends to be more and more players at Amazon Marketing. We interviewed around 25 professional players; Amazon marketing experts, Sellers, Vendors, technology providers, powerful agencies and also a new breed of agencies, fully dedicated to the game.
We discovered this game when we asking a seemingly innocent question to a group of leading Search agencies in 2018. “Are you active on Amazon?”. Whereas 80% of the respondents were involved in shopping campaigns, only 32% were active on Amazon Ads. We discovered this gap in our research for the Search Trends Report and already then, the idea for the new Amazon Marketing Report was starting to take form.
Seven expert interviews, over twenty respondents to a 64-question survey and 67 pages later, we have acquired insight into this magnificent universe of crazy growth, huge gains, and intense competition.
Who plays and who wins?
Amazon Ads grew by 41% between 2018 and 2019 and passed the volume of advertising revenue generated by Bing already some time ago. Amazon is now considered part of the Triopoly of global digital giants: Google, Facebook, Amazon. This notion does ignore some major Asian players, but from a European and North American scope, which is what we had in our research project, it is a very useful notion. Amazon is still the smaller player representing around 23% the size of Facebook and 12% of Google, but its’ growth is much higher than the others, and it is therefore taking market share within the Triopoly.
And advertising is not even Amazon’s primary activity. As global ecommerce leader with a 12% market share, Amazon becomes a major force to be counted within several of the strongest growth markets in the economy with consistent double-digit growth.
Operating behind the two types of players mentioned, we find the marketing operators and these are inhouse teams, digital marketing agencies and this new type of agency which we have called the Amazon-specific agencies; fully dedicated to marketing on Amazon and often created by ex-Amazonians. It is almost like history repeating itself. How many search agencies were created by Xooglers (ex-Googlers), I wonder?
However, the biggest surprise in the game is that Amazon is a player itself. Either as an operator for Vendors, or with its’ own brands like Amazon Basics and all the time aiming to perform on its’ two obsessions: user experience and sales growth.
So, who is winning this game? Our experts gave a large range of opinions, like Megan Harbold of Kenshoo explaining how it used to be the brands and then it used to be the size of the budgets that matters, but today it is about being present and optimizing for the entire user journey to succeed.
Some inputs were surprising, like the input from Tanner Schroeder of Hanapin Marketing who simply stated that Prime is the big winner presently. For Nils Zündorf from factor-a, a tools provider it is clearly the end user who is the winner and finally for Evan Facinger from Foremost Media it is Amazon. « Because Amazon is forcing everybody to do it the way they want ». Lots of winners but not necessarily the ones we expected.
What are the rules of the game?
You can explain the marketing mix on Amazon in a very simple manner by revisiting one of the most well-known marketing models created by McCarthy in the 1960’s, the 4 P’s of marketing. The product, its definition and description, the price which plays a major role, the place which we define both as the geographic dimension for delivery as well the semantic territory (keyword positions) where the product is placed, and finally promotion incorporating advertising, special operations and peak events. Operation on the Amazon platform really requires one to optimize all 4 dimensions of this model and not just one of two. The importance of managing price was put in perspective by Nils Zündorf: « Advertisers are worried that Amazon will destroy their price if they launch their products on the platform. But Amazon already destroyed the price. »
Beyond these four marketing dimensions, it is important to remember, that Amazon is first and foremost a search engine and has an algorithm deciding, what the user will see. « It is a bit like Google 10 years ago ». Similar yes, but also different, because the sale will be a contributing factor to deciding, what products will appear in search and in the buy box. The faster a product is selling, the better its’ position. This « sales velocity » is part of the algorithm and thanks to this factor, there is an almost direct positive impact of advertising on positioning in the search results. This is very different from Google, where we have heard ourselves explain again and again that: “NO, there will be no direct beneficial impact on your SEO from your Google Ads spend”. Advertising is not a ranking factor. On Google.
Obviously, there are many other factors than the Sales velocity. We have categorized them in 3 sections: User experience obsessions, Sales maximization and Product attractivity. The successful Amazon marketer will act on the 4 P’s and aim to optimize the user experience and product attractivity and maximize their sales. They will do this with data. Amazon is a data-driven platform and the marketer is a Data marketer tracking KPIs, applying optimization cycles and testing all along.
How do you win?
To win a game of poker, you need to decide what cards you are betting on. To win at marketing on Amazon, you need to select the products you want to put in the game. Product selection is the first strategic choice you need to make, and it can have an impact beyond the Amazon platform. In the Amazon Marketing report, we detail four different winning strategies. They are not contrary strategies rather they correspond to different maturity stages in Amazon marketing. All the strategies have an advertising element to them. It is similar to betting – if you don’t bet, we believe it is difficult to win on Amazon today. A strong brand is not enough, products without competition hardly exists, and we rarely see players who have a significant price advantage over competing products.
We named one of these strategies “Holistic takeover”, and it was inspired by an expert Amazon marketer named Cherie Yvette. This strategy is for mature Amazon marketers, and is a real all-in poker game, where you identify a product with a strong position, analyse competitors and especially the category leader, build a feasibility and risk assessment for a category takeover, and then saturate the entire competitive space with advertising, in order to build the necessary sales velocity to become the top seller. If the strategy succeeds, you will typically have more than doubled your sales and probably lost money in the process – money you will win back quickly by maintaining your category position at a much higher leverage.
So, to win at this poker game…
Before placing your bets, you need to analyse your cards carefully. Do you have strong hand? Should you rather quit or wait for better cards? How many cards do you need to change to have a winning hand? And how fierce do your adversaries look?
Do you have the right hand? Yes? Then it is time to go all-in and dominate the table.
Source : « Marketing on Amazon in 2020 », Innovell February 2020, https://www.innovell.com/amazon-marketing-report/
Amazon’s AWS logs third outage this month, affecting Slack, Epic Games Store, Asana and more
Amazon’s crucial web services business AWS is experiencing problems today, with issues affecting services like Slack, Imgur, and the Epic Games store for some users. It’s not looking good if you’re working from home, with some Slack users unable to view or upload images, and work management tool Asana also hit by the outages. As of 6:13 AM PST, Amazon said it had restored power to affected servers, but users may still experience issues going forward.
In an incident update, Slack said its services were “experiencing issues with file uploads, message editing, and other services.” Asana said the problems constituted a “major outage,” with “many of our users unable to access Asana.” Epic Games Store said “Internet services outages” were “affecting logins, library, purchases, etc.”
It’s the third time in as many weeks that problems with AWS have had a significant effect on online services. Two incidents earlier this month involving AWS ended up knocking out a huge array of platforms and products, taking out streaming sites like Netflix and Disney Plus as well as smart home devices like security cameras from Ring and Wyze.
Today’s outages seem less widespread but still notable, with some users unable to access services entirely and others merely experiencing intermittent faults. DownDetector.com shows reports of issues with the platforms mentioned above, as well as news aggregator Flipboard, online learning site Udemy, dating app Grindr, streaming service Hulu, and IoT services from Honeywell, Life360, and Samsung’s SmartThings.
The official AWS service health dashboard blamed the issues on power outages in a single data center, affecting one Availability Zone (USE1-AZ4) within the US-EAST-1 Region. At 6:13 AM PST, the company said it had restored power to the data center and was making progress recovering the affected instances. However, users will likely continue to notice the effects of these outages for a while longer while systems are updated and restored.
Update Wednesday, December 22nd, 8:36AM ET: Updated story to add responses from affected services.
Update Wednesday, December 22nd, 9: 34AM ET: Updated story to note that AWS has restored to power to the affected data center.
The NLRB decision against Amazon was correct and shows the need for stronger labor laws
The National Labor Relations Board (NLRB ruled last month that Amazon had cheated to defeat a high profile union organizing campaign.
It found that Amazon violated federal labor laws during its anti-union campaign at a Bessemer warehouse, Ala. earlier this year. This will result in a do-over election.
The NLRB criticized Amazon’s “flagrant disregard” for federal union election rules and stated that the management had “essentially highjacked” the process and given the impression that it was in control of the outcome.
Last week, Kirsten Swingingen, the head of the virulently antiunion Coalition for a Democratic Workplace, published a misleading op ed in The Hill about the NLRB ruling.
Let’s first be clear about the reasons why Amazon was ordered to rerun its election by the NLRB.
According to the op-ed, Amazon installed a mailbox in order to make voting easier. However, the NLRB repeatedly told Amazon that it couldn’t have onsite voting. After the company pushed for it, and then unsuccessfully appealed against the NLRB decision. In a stunning act of arrogance, Amazon’s top managers ignored these clear instructions and forced the United States Postal Service to install an onsite mailbox just before the election period. A senior USPS manager stated that this was the first instance in his many decades of service when it had set up a “cluster mailbox” for a single customer due to the upcoming NLRB elections.
After being told by the USPS to not place stickers on the mailbox, Amazon covered the mailbox with a marquee with large slogans. The USPS replied, ” Surprise” when asked how he felt about Amazon’s disregard for clear instructions. Moreover, the NLRB discovered that Amazon’s management engaged in illegal monitoring of workers’ voting intentions.
These charges are serious, considering the overwhelming evidence of illegal activity. It would be surprising if NLRB did not reverse the tainted election. This would be a message to employees that the law doesn’t apply to them if they have the wealth, resources and ability to bully them if it was in the way of Amazon’s illegal conduct.
The NLRB Hearing officer and its Atlanta-based Regional director made the decision to reverse the tainted vote. Neither of these people are political appointees – instead, they are career lawyers or “former employees” as the op ed misleads. Swearingen instead resorts to misleading tropes regarding “Big Labor” in order to describe a small, but determined union, the Retail Wholesale & Department Store Union. This union is up against Amazon, one of the most powerful and wealthy corporations on the planet. Bessemer was not the first to find Amazon guilty of illegal anti-union behavior. The NLRB found Amazon in violation of its laws.
It is important to correct a blatant lie about the Protecting the Right to Organize legislation (PRO Act), currently pending before the U.S. Senate. Incorrectly, the op-ed states that the PRO Act “potentially eradicates secret ballot elections” but allows for “card certification” of unions. This is essentially recognizing unions only after authorization cards are signed by the majority of workers, as practiced in many rich democracies.
To be clear, the Pro Act does not mention card check certification. The author created this provision to support her extreme anti-union views. The PRO Act would ban mandatory anti-union “captive audience” meetings- forcible listening sessions. According to Amazon’s own testimony, these were conducted thousands of times at Bessemer. It also imposes harsher penalties on corporations like Amazon who violate workers’ right to choose a union.
The op-ed also states that “Big Labor… succeeded in pushing Democrats to include PRO Act policies into the budget reconciliation bill.” However, the bill only contains the PRO Act provision. This includes the much-needed financial sanctions for corporations such as Amazon that repeatedly violate workers rights.
The NLRB was right to reverse the Bessemer election that was fundamentally tainted due to Amazon’s conduct. The Bessemer campaign demonstrates that the NLRB needs to have more options. As it stands, the law is too toothless for a massively powerful, incredibly wealthy, and frequently illegal corporate bully. The Senate should immediately pass the PRO Act.
Amazon Alexa SEO Tools Is Closing
Alexa.com announced that it will be retiring its marketing services after 25 years. Founded in 1996, Alexa was subsequently acquired by Amazon in 1999. It was initially known for providing rankings based on traffic measured through a toolbar but Alexa eventually expanded to provide a full suite of marketing products including site auditing and backlink checking.
Screenshot From Alexa Content Marketing
Alexa.com provides a full suite of search marketing tools. However what it’s mainly known for is their Alexa Rank.
Alexa Rank is a metric that offers a measurement of site popularity.
In the early 2000s the data was collected via an Alexa toolbar that users downloaded and surfed with. The toolbars collected web traffic information from the users which fed into the Alexa Rank site popularity metric.
Web publishers could also install a script on their site that reported traffic which could then be used to raise their Alexa Rank scores.
The Alexa Rank scores were generally viewed with suspicion because some people claimed that installing the toolbar and visiting ones own sites could result in dramatically raising the Alexa Rank score.
Another criticism of Alexa Rank was that the data was more relevant for Asian countries than in English speaking countries. This was based on the rumor that the Alexa toolbar use base was heavily weighted towards users in Korea and not users in English speaking countries like the United States, Canada, Australia, New Zealand and the UK.
The negative reputation of Alexa Rank and anything offered by Alexa was sealed by 2005.
One search marketer in a 2005 forum discussion remarked:
“Isn’t it time for Amazon to throw in the towel on Alexa? For a company that does so many things well, Alexa is really a blight on their reputation. Why would they want to be associated with such garbage.”
Nevertheless, use of the Alexa Rank metric continued to be used by a dwindling amount of search marketers.
For example, to this day there are some companies that offer affiliate programs and use Alexa Rank to determine the popularity of potential affiliate partners and will not accept affiliates whose websites do not reach a minimum Alexa Rank popularity threshold.
Alexa Was More Than A Site Popularity Ranking Metric
It might come as a surprise to many that Alexa offered a complete suite of search marketing and analytics programs.
For some reason the Alexa suite of online marketing tools, which included a backlink checker, was almost kept as a secret, with apparently no outreach to the search marketing community or seemingly no promotional activity to speak of.
Alexa crawled the entire Internet and for many years provided snapshots of the Internet to Archive.org. It’s backlink information was extensive.
Because of that it was able to offer services like showing which backlinks competitors have in common, including as many as ten competitors at a time.
Screenshot Of An Alexa Backlink Information Page
The Alexa $149/month plan offered:
- Content Exploration
- Competitive Content Analysis
- Topic Research
- Top Publishers by Topic
- Competitive Analysis
- Competitor Keyword Matrix
- Keyword Difficulty Tool
- Keyword Share of Voice
- Organic Keywords
- Paid Keywords
- Site Audits
- On-Page SEO Checker
- Competitor Backlink Checker
- Backlink Checks
- Audience Analysis
Alexa announced that it will all be going away on May 1, 2022.
The announcement was short and with no explanation as to what led to the decision.
“Twenty-five years ago, we founded Alexa Internet. After two decades of helping you find, reach, and convert your digital audience, we’ve made the difficult decision to retire Alexa.com on May 1, 2022.
Thank you for making us your go-to resource for content research, competitive analysis, keyword research, and so much more.”
Alexa offered a powerful suite of SEO and marketing tools and it’s sad to see them go away.
Many people didn’t know about the tools and perhaps it might still be around if it had been promoted better.
Official Alexa.com Announcement
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