Maintaining Conversion Rates

This is the fifth of our eight part series on driving traffic and conversion on Amazon. 

Earlier we looked at how traffic is the most fundamental metric in retail and the best way to generate traffic, as well as a few ways brands can utilize to actually win at search and improve conversion rates. Finally, we’ll conclude by glancing at how cereal brands and computer monitors brands are winning on Amazon in the US and UK. Also included is a Q/A with Content26 co-founder and president Mark White and gen.video’s co-founder and president Jessica Thorpe, as they tackle several key questions generated by attendees of our recent webinar, “Driving Online Retail Store Traffic with Paid Advertising and Influencer Programs,” which can be found here.

Maintaining Conversion Rates

In our previous post we looked at how strong conversion rates start with optimizing content - both product and user-generated. To maintain these strong rates, however, brands must invest in managing stock levels and control the buy box. While these steps give traffic and search rankings a slight additional boost, not maintaining stock levels and controlling the buy box will lead to a precipitous drop in conversion.

Stock

Maintaining a rock solid supply chain has always been fundamental to the success of every business. Stock issues are obviously a huge problem for brands, since they represent a period of time during which consumers can’t buy their products. But this is especially true on the digital shelf. Going out of stock, even just temporarily, can have lasting ramifications on Amazon.

This is because search ranking on the digital shelf replaces shelf placement in brick-and-mortar. When an OOS item returns to stock, it just goes back on the shelf. When an item online has stock issues, its search ranking plummets as traffic and conversion fall. When the item returns to stock, it must recover its lost search ranking.

And initially at least, items newly-returned to stock almost never return to their previous organic search ranking.Amazon won’t automatically return recent return-to-stock items to their previous search rankings before the OOS period - brands will have to elevate their products organically. In the meantime, however, competitors and third-party sellers (3Ps) have coalesced around and consolidated that product’s former position, making it even harder to catch back up.

In other words, availability has a direct impact on performance - and out of stock periods can lose the buy box for brands and hand it to 3Ps.

Managing 3Ps

Indeed, dealing with 3P’s is one of the most important ways for brands to control the Buy Box. Needless to say, it’s a nightmare for any brand manager to find themselves competing for the buy box with their own products.

And though 3Ps don’t have the resources, scale, or customer loyalty of the established brands, they often have two key advantages that make them a thorn in the side of even the category giants.  First, they don’t have to invest in brand integrity, and secondly, many 3Ps have first-mover advantage.

Many 3Ps are digitally-native sellers who are comfortable in the digital environment and who have been operating on Amazon much longer than the big brands.  In other words, by the time a major brand adopts a coherent Amazon strategy, many 3Ps have already been on the platform for months or years, building sales volume, ratings and reviews.

The way for brands to counter 3Ps is to control the Buy Box.  Manufacturers can manipulate product ASINS in ways that 3Ps can’t, and savvy brands can use this to improve their own traffic and conversion rates and starve out 3P listings.  

First of all, First Party sellers can take steps to ‘age’ their ASINS to match up with the established 3Ps. This means that every subsequent product model will be added to the same ASIN page instead of creating new pages for each new model - in the meantime ratings & reviews and traffic will continue to accumulate and search ranking should continue to improve.

And secondly, similar to aging ASINS, 1Ps can also add product variations to the same ASIN and merge 3P ASINS to their own. Product variations - different flavors, colors, sizes or formats of the same basic item - can be combined under a ‘parent’ ASIN onto a single product detail page. This allows consumers to easily browse for their preferred version of the same product, improving the shopping experience and encouraging them to spend more time on your product detail page.

Meanwhile merging ASIN’s means that 3P sellers will no longer appear in search results, but instead only appear in the ‘other sellers’ link on the main 1P page.

Brands must always remain vigilant - 3Ps are always waiting in the wings to capture sales when brands go out of stock or lose the Buy Box. The best strategy is to maintain competitive pricing, control the supply chain, and boost performance by collecting all variations, duplications and consumer reviews in one place - all of which drives traffic and sales on Amazon.

To go more in depth on how to succeed in this crucial space, download our whitepaper “Turning Amazon traffic into Amazon sales” here, or give our on-demand webinar “Driving Traffic and Conversion with Paid Advertising” a listen here, and check out the rest of this blog series, and all of our expert insights here.

Danny Silverman
Article by:
Danny Silverman
Marketing

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