Amazon Storefronts is an Amazon microsite that highlights independent retailers that manufacture or handcraft unique products. Amazon launched this subset of their ecommerce platform in September and accompanied it with a national TV advertisement featuring The Little Flower Soap, an indie retailer that has used Amazon to grow their business on a national scale.
The Storefronts microsite lets shoppers buy exclusively from small and medium-sized businesses. Amazon also highlights independent business owners with “Storefront of the Week” videos and “Artisan,” “Family-Focused Businesses,” “Women-Owned Businesses,” and “Innovator Makers” sections that profile a few businesses that fit into each category.
Pro
In a press release, Amazon said they opened Storefronts “to offer customers an easy way to buy from small and medium-sized businesses in all 50 states through the convenient and trusted Amazon experience.” Amazon VP Nicholas Denissen says “Amazon first invited businesses to sell on Amazon nearly two decades ago, and today, small and medium-sized businesses are a vital part of Amazon’s large selection and commitment to customers.”
On a surface level, Amazon Storefronts introduces Amazon shoppers to independent business that they might not otherwise come across. Shoppers who use Amazon out of convenience now have the option of shopping form a curated selection of small businesses. The Amazon Storefronts platform is a great way to get in front of an audience that your business might otherwise never reach.
Con
On a more sinister level, Amazon is under investigation by the EU for using data from third-party sellers to track product sales and profitability. In essence, whenever a third party seller has a product that is performing really well, Amazon notices, duplicates the product, and starts selling it at a lower price.
Shopify’s CEO Tobi Lütke said at Code Commerce that “in a couple of years, if merchants decided that giving all their business’s data to Amazon… didn’t work out as that good of an idea, then I would not be surprised.” He continues, “Amazon’s worldview is that merchants don’t matter. Factories and consumers matter,” he said. “Everything in between is Jeff’s opportunity.” Jeff, referring to Jeff Bezos, Amazon’s CEO.
What’s New
Amazon’s new Storefront effort may be in response to complaints that Amazon is harming Main Street retail. In addition to launching Storefronts, Amazon recently published a “Small Business Impact Report” which says that half of all items purchased on Amazon come from small and medium businesses, and those small and medium-sized businesses selling on Amazon have created over 900,000 jobs.
In 2017, sales from third-party sellers on Amazon exceeded sales from Amazon itself for the first time. Overall, Amazon is a good way for businesses to gain lots of exposure. But, we generally advise that retailers use Amazon as a supplemental storefront, and not their only source of revenue.
Will Clarke, SVP, head of creative at Shoptology tells Independent Retailer, “Today, over half of America holds a Prime membership, so your shoppers are probably already Amazon shoppers. That’s where storefronts could be good for you. If you sell unique, hard-to-find products, then setting up an Amazon Storefront could unlock a huge and ready audience for you.”
Conclusion
At the moment, Amazon Storefronts comes at no extra charge for qualifying Amazon sellers. As an Amazon Storefront seller, you have the possibility of being one of their rotating featured businesses. To participate in Amazon Storefronts retailers need to have an active registered trademark and sign up for Amazon’s Brand Registry. Once you are a registered brand on Amazon, you can sign up for your storefront.
Will Clarke advises, “If I was an independent retailer, I’d first look into ecommerce platforms that allowed me to compete head-to-head with Amazon like Shopify. I’d look into Shopify’s 2-hour delivery options with Post-Mates and I’d really understand how their buyable Pinterest pins and Facebook/Instagram shopping plug-ins work. I’d invest in Google Adwords and make sure my store came up on Google maps to the right audience. And then and only then, would I think about getting into bed with a frenemy like Amazon Storefronts.”