2P Selling Model
on Amazon
Gain Enhanced Control over your Product Offerings and Inventory Management
GAIN FULL CONTROL OVER YOUR BRAND WITH AMAZON
2P SELLING MODEL
In the 2P (Second Party) selling model, you use Amazon as a platform to sell your goods directly to customers. You don’t rely on dealers to distribute your goods – you sell them yourself. 2P brands will operate through their own Amazon Seller Central accounts and will compete with the rest of Amazon sellers for the attention of customers.
You will have undivided control over your brand catalog and image, but it also means you will have an immense scope of work on your plate.
THERE ARE FOUR WAYS FOR SELLERS TO ARRANGE THEIR WORK THROUGH AMAZON, FOUR SELLING MODELS YOU CAN CHOOSE FROM.
If you want to reach higher profit margins and be the only representative of your brand on Amazon, then the 2nd Party Selling Model is a great option. But you may get acquainted with the other:
HOW WE CAN HELP
If you are ready to cede some control over your operations to Amazon in exchange for a reliable source of revenue and a diminished scope of work, then the 1st Party Selling Model might be a great choice for you.
Amazon Brand Registry
If you plan to choose the 2P selling model, you should consider enrolling in the Amazon Brand Registry. It is an invaluable program that brand owners can use to get access to exclusive marketing tools.
Brands enrolled in the brand Registry Program can use A+ Content for their product detail pages, Sponsored Brand and Display Ads in addition to Seller-Central-standard Sponsored Products, an exclusive Amazon Storefront that serves as a piece of digital real estate where you can display your products as well as many other tools. It will give you the means to protect your intellectual property and counteract gray sellers, should they appear.
Amazon Store Creation
Amazon Storefront is a one-of-a-kind microsite within Amazon that enables you to showcase your products in a unique, appealing way. It serves as a virtual storefront where you can convey your brand story and message, all while having your customer’s undivided attention: no competitors will be displayed in your Store. Creating an effective Amazon Store that stays in line with your brand image and displays products in an inviting manner calls for expertise in both design and marketing.
We can create an Amazon Store that will convey your brand story and showcase your products most intriguingly.
Account (ASC) Management
Amazon Seller Central grants the sellers all the tools they need to start selling on Amazon, and by all we mean quite many. Navigating those tools might be challenging, not to mention mastering or at least getting a good command of them. After all, those tools cater to different spheres of selling on Amazon, including marketing, advertising, catalog and inventory management and customer support. One person simply cannot do it all, that’s why any 2P seller needs a whole team to be successful on Amazon. Alternatively, you can turn to us.
We can manage your Amazon Seller Central, monitoring your Account Health and helping identify specific problems with means to address them.
Account (ACS) Creation
Amazon Seller Central is the control panel from which you manage everything related to your Amazon activity. Here, you can manage your inventory, list new products, get sales statistics and provide customer service, in short, do everything there is to do on Amazon.
To get a Seller Central Account, you need to provide relevant business information, personal information, billing information as well as information on your products and store. Navigating the requirements might be difficult even for experienced users and it also requires time. Whether you are a first-timer or a seller who wants to spend that time doing more important things, we can help you get your account registered.
PPC Advertising
Everybody aims for the top positions in Amazon’s search, but this road may take a while to walk. Advertising is a much quicker way to bring your goods to customer’s attention. Brands new and old benefit from this feature as it doesn’t account for how experienced a seller is. However, advertising is a field of its own, and it’s quite easy to squander a hefty sum without generating any sales at all. But there is no need to risk your resources.
We know all the ins and outs of Amazon Pay-Per-Click Advertising and have mastered all three types of ads. One doesn’t need massive budgets to launch ads that work, and if anybody tells you otherwise, well, you know where to go.
Amazon Brand Launch
If you are at the very beginning of your selling odyssey and need help launching your brand, we can help you as well. We offer our assistance with any of the brand launch stages, beginning with drawing up a pre-launch campaign and developing a brand launch strategy to launching your brand and post-launch advising.
We know first-hand that thorough preparation is the best foundation for a successful brand launch, with or without Amazon
Catalog Management
As a 2P seller, you have to manage your catalog by yourself. That is both a blessing and a curse. If you know how to do it effectively, using all the tools that Amazon grants, we can only congratulate you on your expertise. However, in most cases, at least some of the tools remain unutilized, which means missed opportunities for improving your performance.
Weby Corp can help you manage your catalog by creating eye-pleasing and SEO-optimized listings that are bound to catch the customer’s eye. Here are the services we provide as part of our Catalog Management offer:
PROS & CONS OF 2P SELLING MODEL
GREATER PROFIT POTENTIAL:
As a 2P seller, you set your own profit margins and thus may expect to earn more than with other models. 1P sellers don’t have this degree of pricing control since Amazon sets the product prices on its own. You can also sell products at higher prices since you don’t operate through dealers, who would further increase the prices to cover their expenses.
FULL-TEAM NECESSITY:
Managing a 2P business model calls for significant expertise and resources. You need to have specialists who will curate every aspect of your operations on Amazon. That includes people who will set up and manage your Seller Central account, create and optimize product listings, manage inventory levels, provide customer service, run promotional activities and do other tasks. This requires a lot of people and money, and not every brand can afford that.
CONTROL OVER BRAND PRESENCE:
2P sellers have undivided control over their brand presence. Only you will have the right to alter product information and manage inventory. As such, you can ensure that all the product descriptions and visuals align with your brand image and convey a holistic message.
COMPETITION AND PRICE WARS:
Amazon is a highly competitive marketplace, with countless sellers offering the same or similar products and competing for the attention of the same customers. Some sellers are more experienced and thus are more likely to be favored by Amazon, whereas others entice people with lower prices. To keep up with that, you need to be constantly on guard, ready to change your tactics and make concessions to snatch selling opportunities.
DIRECT INTERACTION WITH CUSTOMERS:
Since you interact with buyers directly, you can foster a strong relationship with them and gather valuable feedback on your products and services. This direct interaction is not possible in any other model, since you have either dealers or Amazon itself as intermediaries. Though this interaction comes with challenges of its own, it allows you to build brand loyalty
AMAZON FEES:
Amazon charges various fees for 2P sellers, including referral fees, closing fees and storage fees for those using Fulfillment by Amazon (FBA). Whereas those fees aren’t significant by themselves, they can add up quickly, thus taking away from your potential profits.
FLEXIBLE INVENTORY MANAGEMENT:
2P sellers single-handedly manage their inventory, which gives you the flexibility to swiftly adapt to changes in demand. You are also exempt from Amazon’s stock limitations or storage fees that apply to 1P sellers. You also don’t need to worry much about stockouts, since they are not so detrimental to your performance.
INVENTORY MANAGEMENT CHALLENGES:
While having complete control over your inventory can be an advantage, it can also be a challenge. You need to ensure that you have enough stock to meet demand, but not so much that you incur high storage fees. To do that, you need to constantly monitor current sales and make educated predictions regarding future ones. You also need to account for the seasonality of your products.
ACCESS TO DATA:
As a 2P seller, you will have access to all the aspects of your operations on Amazon. You will have information on your sales, listings’ visits, customers, promotions and anything else you might think of. This wealth of data will allow you to adjust your strategies, optimize listings and promotional campaigns that don’t perform well, alter your customer persona profile based on information from real buyers and modify other aspects of your work on Amazon.
COMPLICATED POLICIES:
Amazon is notorious for its more-than-numerous policies. If you want to sell on Amazon, you have to comply with all of them. Failure to do so will bring about penalties of various severity. You might get some of your listings banned or even the whole account suspended. And even if you think you are aware of all of them, Amazon is equally known for constantly updating its policies. Monitoring the changes in policies is another task you will need to perform.
