Amazon is the undisputed king of the jungle when it comes to dominating worldwide e-commerce sales. According to recent findings from Business Insider, more than 50% of all online sales for 2016 went to Amazon. Other merchants had to fight for the remaining 47%.
For 2017, Amazon is expected to increase its market grab, currently valued at about 53% of all e-commerce transactions, to an unprecedented 60%, in par with a 2015 Fortune publication that predicted similar year-over-year growth. Four reasons why Amazon is able to win over half of all purchases online is because it offers unrivaled selection, low prices, cheap or free shipping and hassle-free returns; the core tenants to e-commerce success.
Most Amazon Sellers Are Multichannel Merchants
The vast majority of Amazon sellers are cross-channel merchants. For these retail businesses, it’s been near impossible to consolidate cross-channel data, much less get a complete look a customer’s life cycle, up until just recently.
Amazon’s backbone is its healthy merchant base, which accounts for more than 2 million sellers around the globe, according to Tech Crunch. These merchants are what keeps this e-tail giant at the top of all Google searches, combining to sell more than 2 billion products.
But if you are a cross-channel seller, you already know the hair-pulling that goes into trying to consolidate data between all your channels, especially when Amazon’s system doesn’t talk to most software solutions, and proprietary CRMs won’t work with other sales channels, like eBay, Shopify, BigCommerce, 3dCart and others.
The Data Pinch is Real
A recent Web Retailer survey of 1,500 Amazon merchants revealed some surprising numbers: 77% of Amazon sellers are cross-channel merchants. These multichannel merchants are selling on other marketplaces like eBay, Etsy and Rakuten, as well as hosting their own online stores. According to the survey, 35% are using Shopify, 32% are using Magento, and the remainder are using a mixture of various shopping cart hosts like 3dcart. With two-thirds of Amazon’s seller base selling on more than one channel, the need for cross-channel data analysis and customer relationship management is omnipresent.
The Cost to List
While Amazon remains a lucrative market to sell on, multichannel sellers also pay handsomely in fees to do so. According to Amazon, Individual Seller and Pro Merchant accounts cost sellers 8%-15% in fees per transaction. If they are using Fulfillment by Amazon (FBA), they can expect to pay added fees. All the while, sellers need to follow Amazon’s listing rules and honor the returns policy while maintaining a positive store rating.
For some sellers, a variety of items in their inventory may not have enough of a threshold to make sense listing them on Amazon. Sometimes, it’s more advantageous for merchants to instead offer such products on their webstore to make them profitable. Either way, merchants don’t have a clear-cut way to compare data, improve the customer journey or market to their target audience directly from the numbers Amazon delivers in their reporting without spending hours manually inputting data from one system to the other.
Solving the Data Pinch for Cross-Channel Merchants
While cross-channel sellers have a vested interest in operating on competing marketplaces, Amazon, of course, does not. The company stands to gain nothing by allowing fully integrated systems into their API, which can open the door to competitors like eBay and Jet. By forcing retailers to manually aggregate data, it also ensures Amazon’s marketplace dominance.
But for multichannel merchants who need to know who’s buying and returning what, when and why, what’s trending, historical data, and a way to improve the connection with the customer and ultimately their journey, there’s a lot on the line.
Newer cloud-based Amazon CRM software solutions are emerging that can help resolve this data pinch. These systems connect to the seller’s sales channels and import all the data, including things like sales reports, shipping, returns and tracking data, as well as pertinent customer information, delivering the traditional bells and whistles of CRM while maintaining an analytical e-commerce approach.
Unlike conventional CRMs, the databases of those designed for e-commerce are populated in real-time and are powered by the cloud, which improves security and increases accessibility. These newer CRMs enable the multichannel merchant the ability to finally get a complete look at all of their data, as well as their customers, in real-time. Retailers can then use this data to improve their operations and offerings, while empowering them to enhance the customer relationship and journey, ultimately leading to increased retention and better long term loyalty.
SaaS Integrators Are Changing E-commerce
As the Huffington Post reports, “Integrators will become the new hub for e-tailers, namely because they will merge data from all sales and social channels, including cloud services, hybrid cloud applications and even light client applications.”
Just how applicable is a cross-channel CRM for e-commerce moving forwards? According to forcasts by Forrester Research, 2017 is predicted to deliver more than $1.8 trillion in cross-channel sales. Finally, these retailers will have a clear-cut way to dig through their data and put it to work for them… with trillions of dollars on the line nonetheless. Amazon will still be king of the jungle, but who says that the lions can’t divvy up the lion’s share?