In the past few years, Amazon has seen swift growth largely propelled by its principal commerce division. It was responsible for roughly 44% of online sales in 2017 and around 4% of all retail sales across the United States.
This expansion offers great potential for individuals in the online commerce field, but it also presents challenges for sellers on Amazon.
In the competitive world of online retail, the way you showcase your merchandise is key to attracting contemporary consumers. A systematic strategy may elevate your likelihood of triumph, improving efficiency and outcomes via a series of tactical maneuvers. Central to this approach is Amazon Catalog Management. As vendors on the biggest virtual marketplace globally, you can enhance your product rankings and sales by properly arranging and displaying your Amazon offerings. This boosts exposure and lays the groundwork for enduring expansion in the long run.
What is Amazon Product Catalog Management
A digital merchandise listing is similar to an old-school paper catalog. This is the method Amazon employs to describe a product or a group of goods and their properties. A digital archive could include several items that have specific shared features.
eCommerce firms such as Amazon strategically manage their product catalogs to encourage upselling and cross-selling by structuring product information in their online catalogs. Regardless of whether your product information is kept in-house or by an external provider, you must adopt catalog management strategies for your eCommerce site.
What are some best practices for successfully managing the Amazon Catalog
Crucial strategies for managing an Amazon catalog effectively include:
- Utilizing superior product catalog management tools to enhance workflow efficiency.
- Examining and structuring your product catalog meticulously.
- Formulating and charting out robust order management procedures Labeling, classifying, and supervising product information.
- Employing automation to save valuable time and enhance productivity.
- Enhancing content to offer precise, reliable data to consumers.
- Establishing variations and bundles to amplify product exposure throughout your entire catalog.
- Recommending associated products for cross-selling and up-selling opportunities.
Adding products to a catalog is a task any business can undertake, yet leveraging Amazon catalog management is an exceptionally efficient method to work more intelligently, not merely harder. Without a dependable process in place, devising a workflow that augments profitability may pose a challenge.
What are some common Amazon Catalog Challenges you might face on your Amazon journey?
Packaging Restrictions
Amazon enforces strict rules regarding the packaging and shipment of goods to its Fulfillment Centers. Over time, Amazon has proposed specific box dimensions, and any deviation from these could either slow down the processing time or, in the worst-case scenario, deem the entire shipment unsuitable. In such cases, the products are returned to the seller, and the sellers shoulder any prior handling expenses.
Sellers face multiple hurdles, one of them being that they have to cover both the shipping and return costs from Amazon’s warehouse. This situation also has significant implications regarding lost opportunities as inventory tied up in transit or inspection could have been sold through other channels. The rejection of shipments can happen for various reasons, including using unauthorized shipping partners, non-compliance with Amazon’s pallet requirements, or cancellations due to delays.
To read more about packaging requirements, visit this page.
Stock Expectations
The primary hurdle for Amazon vendors is always keeping up with the required stock levels. An insufficient stock with a high turnover rate can lead to recurring stockouts. Conversely, maintaining an excess of stock that doesn’t sell for extended periods results in steep storage fees and penalties levied by Amazon. Both scenarios can negatively affect a seller’s performance in the Amazon marketplace.
In the current business environment, companies require a predictive and advisory system based on algorithms for maintaining optimal inventory levels. These systems use past inventory and sales data, enabling businesses to reduce inventory holding costs and enhance customer satisfaction and loyalty.
Amazon’s inventory restrictions aren’t limited to just inventory levels. The company uses a measure known as the Inventory Performance Index (IPI) to evaluate a seller’s inventory management skills. This index is determined by considering the one-year performance of four elements: excess inventory, sell-through rate, stranded inventory, and in-stock inventory.
A poor IPI score can pose several challenges. To begin with, Amazon vendors with such scores might find their products buried in search results, giving their competition an upper hand in an already tough market. Furthermore, a low IPI score might result in losing the coveted Amazon Buy Box, thus prioritizing other sellers offering the same product on the platform’s product page.
High Fees
The final hurdle in this list of Amazon difficulties is the medium to high fees Amazon FBA imposes for its services at each stage. These fees vary, recurring or one-time. As they accumulate, some Amazon FBA merchants have reported as much as 53% of their total income being paid to Amazon in various charges. Even under the FBM or Fulfillment-by-merchant model, sellers have reported Amazon-related expenses reaching up to 27% just for product listing and any search advertisements they might have launched.
To read more about Amazon fees, visit this page.
Changing Product Information
One frequent frustration for merchants is wanting to edit their listed product details via the Seller Central platform yet finding themselves unable to remove or alter the data. This could be because the product details they’ve provided don’t align with the style guide or due to contribution conflicts from a reseller.
As an Amazon merchant, numerous hurdles await you, particularly in the early stages. Nevertheless, as alluded to initially, the digital bazaar is a distribution outlet teeming with immense possibilities. Thus, the moment has come to tackle these issues and refine mechanisms to harness this latent potential effectively.
Are you facing these issues regularly and unsure how to devise a permanent solution? Reach out to our team of experts.
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