By Greg Mercer, founder & CEO of Jungle Scout, the leading all-in-one platform for selling on Amazon.
I’ll let you in on a little secret: it’s not brands that are leveling up product quality on Amazon — it’s third-party sellers.
I’m the founder and CEO of Jungle Scout, the leading all-in-one platform for selling on Amazon. We help entrepreneurs of all kinds sell great products on Amazon and build profitable businesses. Selling private labels, or creating your own product or brand to sell, is the most popular sales model on Amazon. With the right strategy, it’s highly lucrative. You may think private label means coming up with a new product idea, but entrepreneurs are really thriving because they’re improving an existing product.
Because of Amazon’s design, competition lends itself to inevitable ingenuity. Today, it’s not enough to have a good product to win on Amazon, it’s about having a great product with the reviews to back it up.
So how are third-party sellers changing the product quality game on Amazon?
While innovation can come from invention, many entrepreneurs find success on Amazon by going back to the drawing board with an existing product. They find an existing product that has high demand and low competition, as well as some need for improvement. These sellers identify pain points or find new use cases for a product, and then they go manufacture a better solution.
So how do sellers know what to improve? They look at product reviews. Reviews are a window into all the ways a product can be changed to satisfy future customers.
The key to selling a product is having it stay great. That’s why maintaining solid reviews and listening to customer feedback are so important. Shoppers are fickle and selective, and they won’t stick with you if they can easily find a superior alternative.
Despite a product appearing to be popular on Amazon, sellers can see that shoppers may want a new addition to the product, better functionality or a different color in product reviews. For example, we recently found a dog toy advertised for “aggressive chewers,” although low ratings claim the product lacked durability and posed a threat as a choking hazard.
Sellers can make superior products by fixing the current seller’s errors. In this case, they can make a dog toy with stronger materials. Sellers find a similar — or even the same — supplier for the product and then create a unique brand or “private label.” Third-party sellers use this strategy to capitalize on existing opportunities all the time.
Now, a seller can create an optimized listing to proactively advertise the new and improved “ultra-tough” nature of the dog toy.
With the product’s refreshed listing, ranking improvements and keyword strategy tweaks, the newer iteration has a strong chance to be the preferred choice for shoppers and could out-sell its predecessor. This new product has leveled up product quality all around. The cycle continues — products get better or they won’t get purchased.
Challenging Traditional Brands
Third-party sellers are becoming the tastemakers of the online consumer space. Amazon has seen a massive rise since the beginning of Covid-19. According to Jungle Scout’s Q1 2021 Consumer Trends Report, 70% of U.S. consumers have an Amazon Prime membership. Sellers must hit a certain benchmark of excellence to stay relevant on the world’s largest retail platform.
Third-party sellers are keeping brands on their toes, too. Sometimes brands don’t know who their competition is online or think they don’t have competition on Amazon at all (big mistake right there).
Third-party sellers may have the benefit of being more agile and able to understand what’s in demand. More and more shoppers are turning to e-commerce and diluting the power and influence of traditional brands with social proof. Shoppers heavily rely on crowdsourced reviews to make decisions, not the pedigree of a brand name.
Now, brands must constantly improve their products to go toe-to-toe with the product excellence of third-party sellers. And of course, consumers are the ones benefiting from the competition. Product reviews are the fastest avenue for research and development brands have ever had — spurring them to take quick action and make better products.
What We Can Learn From Third-Party Sellers
As more consumers flock to e-commerce and Amazon, subpar products won’t be able to capture rising demand. In the Amazon world, creativity and quality are “survival of the fittest” for third-party sellers. And we can learn a few things from them:
• Read product reviews. In a digital environment where social proof is king and shoppers do the talking, read reviews. And do everything you can to solicit more and accumulate product feedback. Reviews beget more reviews, only increasing your product’s influence.
• Always be ready to iterate. Improving your product (or improving an existing idea) should be top of mind. Choosing a product that can be easily changed is one of my must-haves for selling on Amazon, and creating a business in general.
• Deliver a great product. As an entrepreneur, your sole mission is to provide a product or service and exceed customer expectations. You can’t hope your business will succeed, you have to ensure it will by following steps #1 and #2.
We owe the high benchmark of product quality to third-party sellers on Amazon. Through their pursuit of building profitable businesses, third-party sellers provide an invaluable service of creating only the best products for Amazon.