Amazon has reached the Nordic region. Here we review why you should take a stand on your Amazon strategy right now and the factors you should pay particular attention to.
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AMAZON
The large e-commerce mastodon, Amazon, has reached the Nordic region. Rumors have flourished for many years, but now the giant e-commerce platform has made its entrance into the Swedish market.
What does that mean for you?
Amazon is no stranger to Nordic consumers. Many of your customers have already shopped on Amazon for several years, where the products have primarily been shipped from the platform’s domain in Germany, England and the USA. In Denmark, Amazon already accounts for almost two percent of online shopping without formally being present. A figure which, according to Boston Consulting Group, will rise to between eight and 20 percent over the next five years.
Even though Amazon has not yet made its official entry into Denmark, they actually have a shared third place in the market share of e-commerce and is the fourth most used online store in Denmark. Imagine how important Amazon will be now that they have officially launched in the Nordic region and will be able to offer customers the opportunity to become a member of the Prime program. Among other things, they offer day-to-day deliveries, which in their other markets is one of the keys to success.
What should you be aware of before joining Amazon?
With the above in mind, it is difficult to understand how you can avoide to establish yourself as a seller on Amazon. But Amazon is also characterized by high competition and incredible price pressure, which can make it difficult for you to achieve success.
In addition, the distribution of power is not on the side of the negotiators. Amazon has incredibly high standards for delivery and customer service, and even if you manage to meet those requirements, bad reviews from your customers can negatively affect your visibility on the platform. If, on the other hand, you perform exceptionally well, you risk that Amazon sees a good deal, copies your product and sell it under its own brand at a lower price.
Therefore you won’t be able to establish yourself as a seller without a risk og it requires you to set aside time and energy to get acquainted with the platform.
If, on the other hand, you choose to stay away from the platform, you must also be aware that this does not necessarily mean that your products will not be available on the platform. On Amazon, everyone has free access to create an account, which means that other retailers, and even your customers, will be able to sell your products with their own pictures, descriptions and prices and are therefore able to snatch your customers.
What should you know about Amazon?
Since 1995, Amazon has evolved from being a small online bookstore to being one of the world’s most valuable companies. The e-commerce platform is already present with local domains in 15 countries on 5 continents, selling everything from electronics and groceries to streaming and cloud services.
Amazon is a search engine just like Google, only exclusively with e-commerce. Therefore SEO optimization and advertising are just as important as they are at Google. Your optimization of keywords in your product title and description is just as important in order for your product to appear in search, as it is on Google – if not more.
Therefore optimizing your advertising on Amazon is just as important as optimizing your Google Ads.
Where the majority of consumers in Denmark use Google when they have to search for products – from inspiration to purchase, the majority of product searches in the USA and in Germany are carried out on Amazon. In the two countries, Amazon have a larger share of product searches than Google has, and it is assumed that the majority of Danish product searches will pass to Amazon when the mammoth make its entrance on the Danish market.
When Amazon comes to Denmark and initially get a hold of the Swedish market, you must not only deal with increased competition from all the existing Amazon sellers, but you will also have to deal with new search patterns among your customers.
Why you should consider your Amazon strategy right now
If you want to establish yourself as a seller on Amazon, there can be great benefits in testing the marketplace already. It will give you a head start in relation to your competitors, where you can get to know the platform and its mechanisms better.
The day Amazon chooses to launch in Denmark, you will already be present on the platform. And you have the opportunity to collect reviews in advance, which will give you an advantage in relation to your competitors.
Are you still wondering if Amazon will have an impact on you and your e-commerce?
If Amazon’s dominance is not clear enough from its already large influence on the Danish market, then a look at the statistics from the markets where it has already made its entrance, may convince you.
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AMAZON STATISTICS
- In 2017, Amazon accounted for 44% of all e-commerce in the USA. That equates to about 4% of the total retail sales in the USA.
- In Germany, as much as 46% of online shopping in 2017 was done on Amazon.
- In 2016, Amazon had a market share of 16% in online retail in the UK. And today it is the UK’s 5th largest retailer.
- In France, Amazon accounted for a 19% market share in online retail in 2017.
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