Avoiding the Siren Song of Amazon Will Save Your Business

Posted on November 7, 2018

The siren song of selling on Amazon is unavoidable. They’re the biggest brand in e-commerce and reach a wider audience than is comprehensible. Surely your product would sell itself with the reach of Amazon, right? That may be true, but it won’t sell itself for long. The siren song may be unavoidable, but if you remember The Odyssey, ships that sailed toward the sirens ended up at the bottom of the sea.

Amazon controls 50 percent of the market share of all e-commerce brands. That did not occur by cooperating with other brands. It occurred because Amazon has been focused on the long game since its inception, prioritizing market share over short-term profits. Amazon is willing to lose money and has the capital to do so for a long time. That’s their model, and it works in a ruthlessly effective way.

So imagine your store sells dog food, and you sell it on Amazon’s marketplace. Perhaps people will see your dog food when they’re trying to feed the family Springer Spaniel, Dutch. They might even visit the product page. But as they’re about to buy your product, something detrimental to your store happens: Amazon offers them a more affordable option.

As you’re checking out on your dog food, Amazon gives you 50 percent off a trial sized bag of their brand, Wag. The prices are lower too. Oops, you’ve just lost a customer.

Amazon can afford to offer a 50 percent discount and can afford to undercut your prices drastically. Maybe they’ll hemorrhage money on the brand initially, but when you lose customers at every checkout, you’ll have to close up shop eventually. And when you close up shop, Amazon’s brand takes that share of the market. It’s a brilliant strategy and has obviously been a winner thus far.

As you can see, while selling on Amazon sounds lovely, it can lead to the demise of what you’ve curated and toiled on for years. It’s much more difficult to sell on your own terms, but it’s also much more sustainable. It doesn’t matter if you’re reaching a larger audience of customers if that larger audience picks Amazon’s brand every time.

So go out and build your brand into something that stands out from Amazon. Put proverbial wax in your crew’s ears and tie yourself to the mast of the ship. You’re going to be tempted, you’re going to be wooed, you’re going to be intoxicated, but you have to stay on course because Amazon’s siren song does not have a happy ending. Be like Odysseus and make it through the dangerous waters of e-commerce a stronger, better person with a stronger, better store.