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Surviving ‘the Amazon’: Beyond Commodity Sales

INDUSTRY BUZZ

July 2017

Surviving ‘the Amazon’: Beyond Commodity Sales

Amazon’s North American sales increased 25.2% in 2016 and industry analysts expect this robust growth to continue in the years to come. As numerous brick and mortar chains are downsizing as a result of this shifting retail model, there are some good, basic principles that hydroponic retailers can follow in order to effectively compete, and grow, within this competitive environment. The next few ‘The Scoop’ issues will outline a few of these practices.

Practice 1: Market merchandise that customers can’t readily find on Amazon. Anything that can be traced to an ISBN or SKU number may be mass marketed and mass discounted by e-commerce giants. To avoid competing directly on price, focus on stocking more locally produced items or uniquely distributed ones. Several guidelines are outlined as follows:

  • Research your products to see if they are available on Amazon. Search by product name as well as sku
  • Research alternative brands, not marketed through Amazon, and look for differentiating features/benefits
  • Compare your price point. At the extreme, match Amazon’s price rather than beating it.
  • Leverage your local services and relationships over Amazon’s price
  • Manage inventory ‘turns’ and assure that your top products are on hand for same day delivery
  • Know your product. Train your staff on how your products are differentiated verses Amazon’s

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