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The network effect is anti-competitive

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A U.S. federal judge last week struck down Apple rules restricting app developers from selling directly to customers outside the App Store.

Apple’s stock fell 3% on the news, which is being regarded as a win for small and midsize app developers because they’ll be able to build direct billing relationships with their customers. But Apple is just one of many Big Tech companies that dominate their sector.

The larger issue is how this development will impact Amazon, Facebook, Grubhub and other tech giants with online marketplaces that use draconian terms of service to keep their resellers subservient. The skirmish between Apple and small and midsize app developers is just a smaller battle in a much larger war.

App makers pay up to 30% on every sale they make on the Apple App Store. Resellers on Amazon pay a monthly subscription fee, a sales commission of 8% to 15%, fulfillment fees and other miscellaneous charges. Grubhub charges restaurants 15% of every order, a credit card processing fee, an order processing fee and a 10% delivery commission.

Like app developers, online resellers and social media influencers are all falling for the same big lie: that they can build a sustainable business with healthy margins on someone else’s platform. The reality is the App Store, online marketplaces and even social networks that dominate their sectors have the unilateral power to selectively deplatform and squeeze their users, and there’s not much anyone can do about it.

Healthy competition exists inside the App Store and among marketplace resellers and aspiring social media influencers. But no one seems to be talking about the real elephants in the room, which are the social networks and online marketplace providers themselves. In some respects, they’ve become almost like digital dictators with complete control over their territories.

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It’s something every small and midsize business that gets excited about some new online service catering to their industry should be aware of because it directly impacts their ability to grow a stable business. The federal judge’s decision suggests the real goal in digital business is a direct billing relationship with the end user.

On the internet, those who are able to lead a horse to water and make them drink — outside the walled gardens of digital marketplace operators like Uber, Airbnb and Udemy — are the true contenders. In content and e-commerce, this is what most small and midsize companies don’t realize. Your own website or owned media, at a top-level domain that you control, is the only unfettered way to sell direct to end users.

Mobile app makers on Apple’s App Store, resellers on Amazon and aspiring content creators on Instagram, YouTube and TikTok are all subject to the absolute control of digital titans who are free to govern by their own rules with unchecked power.

For access to online marketplaces and social networks, we got a raw deal. We’re basically plowing their fields like digital sharecroppers. Resellers on Amazon are forced to split their harvest with a landlord who takes a gross percentage with no caps. Amassing followers on TikTok is building an audience that’s locked inside their venue.

These tech giants — all former startups that built their audiences from scratch — are free to impose and selectively enforce oppressive rules. If you’re a small fry, they can prohibit you from asking for your customer’s email address and deplatform you for skimming, but look the other way when Spotify and The New York Times do the same thing. Both were already selling direct and through the App Store prior to Friday’s ruling.

How is that competitive? Even after the ruling, Big Tech still gets to decide who they let violate their terms of service and who they deplatform. It’s not just their audience. It’s their universe, their governance, their rules and their enforcement.

In the 1948 court case United States v. Paramount Pictures, the Supreme Court ruled that film studios couldn’t own their own theaters because that meant they could exclusively control what movies were screened. They stifled competition by controlling what films made it to the marquee, so SCOTUS broke them up.

Today, social networks control what gets seen on their platforms, and with the push of a button, they can give the hook to whoever they want, whenever they want. The big challenge that the internet poses to capitalism is that the network effect is fundamentally anti-competitive. Winner-take-all markets dominated by tech giants look more like government-controlled than free-market economies.

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On the one hand, the web gives us access to a global marketplace of buyers and sellers. On the other, a few major providers control the services that most people use to do business, because they don’t have the knowledge or resources to stand up a competitive website. But unless you have your own domain and good search visibility, you’re always in danger of being deplatformed and losing access to your customers or audience members with no practical recourse.

The network effect is such that once an online marketplace becomes dominant, it neutralizes the competitive market, because everyone gravitates to the dominant service to get the best deal. There’s an inherent conflict between the goals of a winner-takes-all tech company and the goals of a free market.

Dominant online marketplaces are only competitive for users. Meanwhile, marketplace providers operate with impunity. If they decide they want to use half-baked AI or offshore contractors to police their terms of service and shore up false positives, there’s no practical way for users to contest. How can Facebook possibly govern nearly 3 billion users judiciously with around 60,000 employees? As we’ve seen, it can’t.

For app makers, online resellers and creators, the only smart option is open source on the open web. Instead of relying on someone else’s audience (or software for that matter), you own your online destination powered by software like WordPress or Discord, and you never have to worry about getting squeezed when the founders go public or their platform gets bought by profit-hungry investment bankers. Only then can you protect your profit margins. And only then are the terms of service the laws of the land.

Politics aside, as former President Donald Trump’s deplatforming demonstrated, if you get kicked off Facebook and Twitter, there’s really nowhere else to go. If they want you out, it’s game over. It’s no coincidence Trump lost his Facebook and Twitter accounts on the same day the Republicans lost the Senate. If the GOP takes back the Senate, watch Trump get his social media accounts back. Social networks ward off regulators by appeasing the legislative majority.

So don’t get too excited about the new Amazon Influencer Program. If you want to build a sustainable digital business, you need an owned media presence powered by software that doesn’t rake commissions, have access to your customer contact information and has an audience that can’t be commandeered with an algorithm tweak.

TechCrunch

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AMAZON

Amazon Listing Optimization for Maximum Conversions (Step by Step)

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shopping cart on amazon site

Amazon is one of the great places brands and individuals sell their products. It’s a marketplace where buyers search for what they want to purchase. 

According to research done by Statista, the site gets traffic in billions. In December alone, the website got 2.9 billion visits from target customers.

Data showing traffic to Amazon website from september 2021 to February 2022

Source: Statista

This shows that more target customers visit the site to search for products. Therefore, if you have a product you want to sell, it is essential to make sure many of your target buyers see it to increase the chance of selling it. 

This short article will teach you how to optimize your Amazon listing to increase visibility, drive more traffic to your product, and increase conversion rates and sales.

What is Amazon Product Listing Optimization

This is a strategy used to optimize your product’s visibility on Amazon. The plan lets more target customers know about your product and how it can solve their pains.

It makes it easy to rank on Amazon search engines, be discovered by target customers, increase your product’s conversion rates, and drive more sales and revenue.

Why Invest in Amazon Listing Optimization

As an individual seller or a business owner, there are important reasons why you should invest and optimize your products on Amazon. This section of the article will highlight some of these reasons and their importance when selling products through Amazon.

Attract More Target Customers to Your Products

When your listing is optimized, more target customers engage with the products you have to offer them on Amazon. Since they’re on Amazon to search for products to solve their pains, they will get to know about your product and how it can help solve their pains. 

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Increase Brand Awareness

You could be a business offering products through Amazon, but most of your target customers don’t know about your brand or your products. With Amazon listing optimization and the traffic you drive to the product, more people will learn about the different products you offer. 

They will also know about your brand and engage more with it from the website links, where they get to hear from other customers and build more trust with you and your products.

Drive More Conversions and Sales

When your product is optimized with the right quality images, descriptions, and key features or keywords, your target customer can easily search for the product and engage with it. 

They can see that the products can solve their pains and be convinced to try the product to solve their challenges leading to more sales.

Steps for Amazon Listing Optimization

You want to reach more target customers and drive them to engage with your products on Amazon and even buy them, right? Well, to effectively achieve that, there are steps you can follow for your listing optimization. Here are some of these steps for your Amazon listing optimization

Research Keywords

Target customers’ search for products starts with using the keywords associated with what they want. As part of Amazon optimization, keywords target customers use in their search are essential. 

Do a keyword search to know the best keywords your customers use when searching for what to buy from Amazon. You can use the best Amazon PPC management tools and other keyword research tools to help get the best keywords.

It is also essential to use keywords with high search volume. High search volume makes it easy for many of your audience to know about your product listing.

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One way to use the right keywords is to research competitors making more sales from the Amazon website. See the keywords they use and how they connect with their target audience. 

Since you’re in the same market and target the same customers, you can use those keywords for your product optimization and promotion through Amazon. 

You can also read through their product description and key features. See how they write the descriptions and how they use the keywords within the product description and key features sections.

Ensure you don’t copy their description for your products as that can affect your product’s optimization and traffic to your products, affecting your sales.

Use Informative Titles For Your Products

Another essential part of your Amazon listing optimization is your Amazon product titles. Ensure that the headlines of your title are captivating and attractive and use primary keywords in the title. 

Make the titles easy to read and ensure the target audience can get a glimpse and know more about your product from its title even before they read the description. 

Target customers now use mobile devices more than ever for their product search. As you look for the title description of your products, ensure that the title is optimized for mobile search. 

Suppose the target customer is using a mobile device and can’t engage with your product title, description, or any other part of your product optimization. In that case, they will look for other alternative products to buy. As a result, you lose an opportunity to engage and convert a potential customer and make sales.

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Remember, you’re optimizing the listing to drive and engage more target customers, increase conversions, and make more sales. So, if you can’t engage target customers on their mobile devices, you lose a big chance to drive them to take action and convert to be customers.

Use Quality Images For Your Products

Your target customers need to see the product you’re promoting on Amazon, even if you have an excellent product description. As part of Amazon optimization, ensure the product pictures have a high resolution and are clear, especially your main pictures.

It will be easy for the target audience to see the images of what they want to buy clearly. You can even drive the target customers to make a purchase easily when they see the main parts of the product you sell on Amazon.

Your target audience should also be able to zoom in on the product images. It will help them see the parts of the products well. For example, here is a picture of a hp laptop from Amazon with the main product image and other zoomable images.

Zoomable images for a laptop on sale from Amazon site

Source: Amazon

When taking the images for the product, use a white background like the above images for the laptop. Your product should be large enough to occupy  85% of the space allocated for the image on the Amazon site. 

Write Optimized Product Descriptions

Your target customers need to know more about the product. So explaining how your product works in detail is essential. Help the customers know how your product solves their pains and convince them that it’s the best they can have.

Let the customers see the benefits of your product. It will help them quickly see the value and connect how the benefits will help them solve their pains.

As you write the description, use the right keywords with high search volume. The target customers mostly use keywords to search for products from the website. 

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When writing the description, mention relevant details about the product that your target customers can easily understand and are more linked to the pains they want to solve. In addition, it raises their curiosity and makes them engage more with the product to learn how it will quickly help solve their challenges.

Optimize Product Key Features (Use Bullet Points)

When describing the product value and showing the target customers how it works, use bullet points to make it easy for readers to view the content about your products. 

They can quickly skim through the content and engage with it with ease. Use short sentences when showing target customers the product’s key features.

Highlight key benefits of the products to the customers for them to notice as they read and know more about the features. Don’t forget to add to this section’s primary and secondary keywords.

Add Q&A for Customers and Reviews

You have done your customer search and understand their pains and how to address them. Even if you have given the target customers all the other information and description for the product, they will have questions to ask.

You can identify the possible questions your target customers can ask about the product and then provide the best answers. For example, some customers have questions about a car vacuum cleaner sold on Amazon.

Samples of questions and answers customers asked for a car vaacum clearner on Amazon

Source: Amazon

You can also see the questions addressed by your competitors and add them to your questions collection in this section of the Amazon optimization.

You should also add keywords within this section. They will make it easy for your optimization efforts and can also drive more potential customers to engage more with this section and the others above.

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To help build trust and show potential customers that your products have value, add reviews of the product from the past customers. 

Customers trust other customers. Here are the car vacuum cleaner product reviews from the above customer Q&A. Since some sellers want to get customers, it’s essential to use an Amazon review checker to see if the reviews are genuine.

Customer reviews and ratings for the car vaacum cleaner from Amazon site

Source: Amazon

When they hear that other customers with similar problems benefited from the products, they’re more likely to try the product to get equal or far much better results for their pains.

Ready to Improve your Amazon Listing For More Sales on Amazon?

Brands and other sellers are looking for the best channels to drive traffic to their products on Amazon, engage with the target audiences and convert them to make more sales. 

Using Amazon and optimizing your product listings can help you reach those goals and drive more sales for your product.

Suppose your products are not selling on Amazon. In that case, the above steps will help you optimize your product and attract a large target audience who will get to know about your product offers and even convert more customers to your amazon products.

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