The Black Friday and Cyber 1 promotions in 2021 passed in a flash, and major retail platforms also competed to show their performance. Amazon officials said that the platform's sales during this promotion once again set a new record, and more than half of the contribution came from third-party sellers around the world.
However, Amazon did not release the specific sales figures. Facing such a "mysterious" poster, the sellers can only feel that "people's joys and sorrows are not the same." Sales are all off-season, and ACOS and shipping costs soaring together seem to be the main theme of many sellers during the promotion period. Why did Amazon's sales still hit a new high despite the seemingly collective cold situation? In fact, although this year's Black Friday and Cyber Monday sales have cooled down compared to previous years, there are still many sellers who are keenly aware of the trend and are at the forefront of the industry, and they are very popular abroad. Annual sales of hundreds of millions! Why are these sellers successful? Recently, overseas blogger @我是郭杰瑞 visited two Chinese cross-border e-commerce companies that mainly operate on Amazon, and answered the questions of every cross-border seller: What is the secret of the successful overseas expansion of those Chinese sellers who became popular on Amazon during Black Friday? The blogger first visited the clothing brand Orolay from Jiaxing, Zhejiang . Two years ago, the down jackets sold by this Chinese brand became a big hit abroad, even favored by many celebrities and Internet celebrities, and triggered crazy reports from the American media. It is understood that the popularity of orolay is not accidental, and there are many experiences worth learning from for sellers: 1. Find the right product positioning: “Down jacket for traveling in the city”. 2. Start from the customers and explore the aesthetics and preferences of foreigners. 3. Focus on product quality and attach importance to after-sales service: set up a quality control department to collect negative feedback and adjust the process in time 4. Use social media channels and collaborate with influencers to promote your product and increase your visibility. It is reported that Orolay's annual sales volume is about 200,000 to 300,000, with a revenue of about 260 million yuan. Its performance during Black Friday was also booming. Looking to the future, the founder of Orolay is optimistic that sales may achieve a new leap. The development history of Orolay also provides insights into some new trends in current cross-border e-commerce. Many companies started out as OEMs, but due to low profits and fierce competition, they are facing the risk of elimination at any time. Therefore, transformation to brand building and refined operations have become the general trend in the turbulent environment. Through in-depth interviews with top sellers in the industry, the overseas blogger also summarized their secrets to success and revealed the secrets behind their opening up of overseas markets: 1. Product positioning: Find the customer group that suits your product, and don’t try to sell to everyone from the beginning. 2. Brand awareness: focus on the brand, read more user reviews, improve after-sales service, improve product quality, and don’t just do OEM. 3. Channel promotion: Make good use of overseas social media and its influential influencers. Sellers sound the alarm! New outlet or leek garden? However, while the video sparked heated discussions, many Amazon sellers also stood up to sound the alarm: be cautious when entering the market. The video only presents successful cases, and there are more people who followed the trend and got hurt. Indeed, with the help of the epidemic, 2020 became a blowout year for Amazon, and many entrants took advantage of this bonus to taste the sweet fruits. However, as more and more people rushed to seize the market, and various training institutions fanned the flames, the new outlet became a "leek garden", and the industry trend went from getting rich overnight to being in a state of collapse. A seller lamented the fierce competition in the industry today: the nearby software park is full of companies doing cross-border e-commerce, companies are born and closed down quickly, a former classmate has been doing cross-border e-commerce for almost a year, the company continues to lose money and is unable to make ends meet, and can't even pay its employees' salaries. As we enter 2021, the dividend tide has receded and hard power has become the key to success or failure. The strong will always be strong and the weak will always be weak. Some sellers said helplessly that they can still make money on Amazon this year, but the big sellers will make a lot of money, while the small sellers will see their profits shrink. Take the clothing giant Orolay mentioned above as an example. During Black Friday, it launched a 24-hour event on the Amazon homepage, and all customers who entered Amazon could see the products. The reason why Amazon was willing to provide such high exposure for free was mainly due to the high sales volume of the products. The platform's traffic is limited, so the majority of the traffic is basically concentrated on the top products with higher conversion rates and better sales. This results in the top sellers having high prices, while the middle and lower sellers are fighting hard to share the traffic, making it increasingly difficult for them to stand out. In addition to fierce market competition, Amazon's ever-increasing risk control policies and increasing fee exploitation are also severe challenges that sellers must face. With 121 billion RMB defrauded in one year, are sellers suffering from Amazon addiction? According to a recent study by ILSR, the fees charged by Amazon to its third-party sellers are becoming its largest source of income, and the rising costs of sellers have triggered a chain reaction of rising product prices and disrupting market competition. If many sellers want to maintain their business, they have to become Amazon's "cash cow". Cross-border navigation , seller fees have become Amazon's main source of money! Where is the money spent? #Amazon##Cross-border headlines#Cross-border e-commerce video account ▲ Video account focuses on cross-border navigation
The new ILSR report found that Amazon’s seller fees averaged 19% of seller revenue in 2014, but nearly doubled to 34% in 2021. This year, Amazon is expected to collect about $121 billion in revenue from sellers. Sellers’ expenses mainly come from three aspects: sales, logistics and advertising. According to ILSR data, before 2017, sales commissions accounted for the majority of sellers’ expenses, but now FBA services have become the bulk of Amazon’s revenue. In addition, with the continuous increase in advertising fees, Amazon’s advertising revenue is growing steadily. However, despite this, under Amazon's high-end "PUA techniques", many small and medium-sized enterprises have become dependent on Amazon . As costs rise, sellers have to pass on the costs to buyers by raising prices. Due to the pressure of Amazon's pricing policy, prices on other platforms will also increase, making it more difficult for these platforms to compete with Amazon. If sellers want to reach a larger consumer group, they can basically only choose Amazon. It is understood that Amazon currently occupies 40% to 50% of the US e-commerce market share, while its biggest competitor Walmart only accounts for 7%. The U.S. antitrust agency said that in the digital economy, small and medium-sized enterprises have no choice but Amazon, so Amazon uses its monopoly power to suppress competition. Youkeshu, which was deeply affected by the account suspension shock in the first half of the year, stated when adjusting the company's operating strategy that Amazon has strong brand power and huge traffic. While developing other third-party platforms, the company will not give up the Amazon market, which accounts for the largest proportion of revenue. It can be seen that although operating costs and risks are increasing day by day, Amazon is still the main channel for most sellers due to its monopoly position in the e-commerce market. At the current stage, Amazon is still a fertile land with huge potential. With opportunities and challenges, some people have achieved great results while others have not. However, the future is uncertain. The torrent of industry development is pushing everyone forward, and perhaps it will eventually lead to a new era of harmony amid the shock.
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