What you should know about how Amazon is affecting the market in Canada
01 Amazon in Canada
02 Opportunities for Canadian Brands to Expand through Amazon
03 The Darker Side of Amazon: How to Protect Your Brand in the Digital Marketplace
04 How to Prepare for Amazon’s Growing Dominance in e-Commerce
05 Set Yourself Up for Success on Amazon
Amazon in Canada
The e-Commerce industry in Canada has exploded over the last few years. In 2019, 28.1 million Canadians made online purchases and 72% of those consumers shopped on Amazon Canada (or Amazon.ca). Amazon in Canada is a powerhouse, and the big question is not whether Amazon will continue to grow in the Canadian marketplace, but how much it will grow.
Amazon Canada launched in 2002 and has been growing ever since. It employs 25,000 Canadians as of 2021 operates 46 warehouses, logistics and delivery facilities across the country.
In 2021, more than 40,000 Canadian sellers sold 110 million products on Amazon.ca, compared with 60 million products in 2020 and 35 million in 2019.
Despite the millions of Canadians who buy from Amazon, few Canadian businesses sell on Amazon.ca, making it a fantastic alternative for small vendors.
As for Amazon Canada’s revenue numbers, they’re continuing to grow, too. Amazon Canada saw $1.85 billion in sales in 2019. Amazon.ca has been increasing its revenue by year over year, and it doesn’t seem like Amazon Canada will slow down any time soon.
Improved delivery from coast to coast
With its vast territory, Canada is no exception to the rule that its low-density population can slow down growth. However, Amazon has shown us how it can build a strong network and provide quick delivery from coast to coast across both landmasses and lakes. Amazon recently opened its first delivery station in Dartmouth, NS, and extended its delivery service to Yellowknife and Whitehorse.
Amazon has been a powerful player in both Canada and worldwide markets. With more than 25 years of experience in e-commerce, the company continues to innovate while expanding its reach across North America. Amazon’s investments in projects such as drone delivery and brick and mortar stores promise to revolutionize the way we shop, and it will be exciting to see what Amazon does next. As for now, this is what you need to know about how Amazon is affecting the Canadian market.
Amazon’s e-Commerce competitors
With few competitors in Canada, Amazon has been able to rule the North American e-Commerce market with an iron grip. Other e-Commerce players like Walmart, Costco and Best Buy have tried but with little success.
Despite launching its e-Commerce site in 2016, Walmart’s efforts have fallen short. In December 2021, the Walmart.ca website garnered 45 million visitors, but that’s a fraction of the 202.8 million website visits to Amazon.ca. BestBuy Canada is even worse with site visits estimated at 32 million.
The good news for those who want a piece of the pie is that you can leverage Amazon’s power to market your product to millions of potential new customers.
Features like Fulfillment by Amazon (FBA) can help you jumpstart your Amazon game. Amazon’s FBA program can help small and medium-sized businesses increase their revenue numbers and bring traffic to their shopfronts. With FBA, you don’t have to ship products yourself — Amazon does it for you. The FBA program lets a Seller send its inventory to Amazon’s warehouse, where the company stores the product in its facility until it receives an order.
You are charged a small fee per order and a monthly fee based on the number of items stored. This can be a small price to pay for gaining access to Amazon’s huge Prime customer base.
If you’re in a niche market, like hardware or electronics, you could broaden your reach by selling your products on Best Buy or Home Depot. However, you will find that Amazon is the biggest marketplace for products like these.
The future of Amazon in Canada
As the industry leader, it’s likely that Amazon will continue to see steady growth in Canada. At this rate, Amazon’s competitors won’t catch up anytime soon.
To compete, niche marketplaces should consider adding Amazon to their marketing strategy. Small vendors can use FBA to increase their revenue numbers and widen their reach.
Amazon also offers one-day shipping to any part of Canada, and it creates very little cost for small businesses. That’s good news because you can see an increase in sales as people purchase your products online because of its convenient option for faster delivery.
Ensure your business is equipped for the modern age by taking your business to the next level with Amazon. The competition will continue to heat up, but Amazon Canada is well-equipped to continue growing.
Opportunities for Canadian brands to expand through Amazon
Amazon, and e-Commerce as a whole, presents immense growth opportunities to small businesses in Canada. Not only does your brand have access to 72% of Canadian shoppers who frequent Amazon.ca; your products also benefit from Amazon’s global customer base to help you grow your brand and product visibility internationally.
Global marketing strategies to expand your business with Amazon
Amazon.ca is still highly undersaturated as a global seller. With over 200 million visitors and only 40,000 Canadian brands on the platform, there’s a great opportunity to capture a larger share of the pie in this market.
Whether you’re looking to break into a new region or simply expand your product line, selling beyond your local borders through Amazon can boost sales and improve market penetration.
As you plan your immediate and long-term marketing strategy, consider these offerings:
Amazon global selling
As a global seller, your products can appear on Amazon.com and over 16 international Amazon country sites, including the Americas, Europe, Asia-Pacific and the Middle East. Through your seller central account, you’ll have access to millions of customers looking for new products — so this is definitely worth considering for your business.
Amazon’s Global Selling Program offers you the opportunity to make your products available internationally without having to maintain separate inventory in each country. When an international customer places an order on Amazon, you can fulfill the order from your single inventory located in one of Amazon’s fulfillment centers.
Amazon Canada is a competitive global marketplace. You can focus your efforts on prospective customers in Europe, the United States, and the developing regions of South America and the Middle East.
Fulfillment by amazon (FBA)
In addition to offering your products on Amazon’s marketplace, you can also list your products in FBA programs, where you send your inventory to an Amazon fulfillment warehouse, and they pick, pack and ship your orders. Customers benefit from this service because they know your products will arrive quickly and as promised, and buyers purchase with the Fulfilled by Amazon badge.
Here are some additional benefits of using FBA:
- Your products are eligible for Amazon Prime FREE Same-Day Delivery.
- Having your products fulfilled by Amazon can help you avoid fulfillment issues and improve the customer experience.
- You have access to sales performance data from within seller central, so you can measure the success of your products on Amazon.ca.
- Fulfilling orders through Amazon also affects your brand’s Best Seller Rank, which has positive implications for your search ranking.
- Amazon’s fulfillment services will help you grow your business by expanding into new markets, managing inventory and offering one-hour delivery on select items.
Vendor central program
Amazon’s Vendor Central is an invite only program for first-party sellers. This is an opportunity to offer your products in bulk at discounted pricing, increase your brand visibility and streamline the fulfillment process of your large-volume orders.
Instead of selling on the Amazon marketplace, you’ll sell directly to Amazon through the Vendor Central web portal and then they will fulfill your orders — with no additional fees or obligations. Since Amazon own the stock, it controls the retail price of your products.
Generally, you can tell that a company is selling through Vendor Central if the phrase “Ships from and sold by Amazon.com” appears on the product detail page.
These are the main Vendor Central advantages:
- You won’t have to handle or ship your products, so there’s no need to invest in inventory.
- There are no fees for listing, selling, storing or shipping your products to Amazon.
- There are no monthly commitments.
- You’ll get access to reports about your product’s metrics within the Vendor Central dashboard.
The Amazon Vendor Central program is ideal for large brands that are looking to offer their products on Amazon.com.
A subprogram of Vendor Central, Direct Fulfillment is a fulfillment service that allows you to drop-ship orders of your product directly to customers on behalf of Amazon. This means that you will be able to fulfill items directly from your warehouse.
The customer never sees the difference because they’re receiving their package in exactly the same way as if it was sold by Amazon because the phrase, “Sold and shipped by Amazon” will still be on the product description page.
Expand your reach with Amazon ads
As a small business, leveraging Amazon Canada as a marketing channel can help you reach more customers and write a new chapter in your brand’s success story. There are a few ways entrepreneurs can use the platform to build their brand and customer base while also providing additional value to their customers.
Amazon Canada’s search algorithm is designed to make your products more visible and provide an easy way for you to discover new products. You can also use Amazon’s Seller Central to create ads that appear when shoppers are browsing for products similar to yours. This is a great way to gain exposure, drive traffic to your products and boost awareness of your business.
Amazon Canada’s sponsored ads are a great place for small businesses to build their visibility, so it’s something you should consider helping your business succeed. There are several options for small businesses looking to use this platform as a marketing channel, including:
- Sponsored Products ads. These pay-per-click adverts use keywords related to your product’s title and description to attract more buyers.
- Sponsored Brands ads. This type of ad targets customers based on the brand they’ve viewed and allows you to increase your exposure among your potential customers.
- Product Display ads. These ads allow you to reach more customers by targeting buyers who are browsing specific products. Unlike the previous ad types, product display ads are only available to registered vendors.
Amazon offers pay-per-click (PPC) advertising on sponsored product keywords for any search that’s relevant to your business. Regardless of which option you choose, Amazon’s PPC advertising has a very low cost-per-click (CPC) and can be a great way to generate sales.
Use ads to test potential markets
For those who are just launching their businesses or have a new product, Amazon’s sponsored ads can help you test your market and find your target audience. You can use different ads to see the type of response you get and determine which audiences are most responsive.
Amazon’s sponsored ad platform helps small businesses reduce the cost of their initial marketing efforts by allowing them to test multiple ads simultaneously. So if you’re just starting out, this is a great way to see which ad type is most effective, so you can optimize your sales process.
You can also test which ads receive the most engagement to find the best format for your business. For example, if one product description is more effective than another at generating sales, you can use this information to create a more effective ad copy going forward. This is often called A/B testing.
Enhanced customer experience
Amazon may have started as an e-Commerce store. However, it’s expanded beyond that into the realm of customer experience. People now look to Amazon as a source of information, which is how they manage their lives. Customers will research products and brands on Amazon before going to a physical store or purchasing on your website.
One reason for this is that buyers are more likely to trust a brand or product that appears on Amazon and has positive customer reviews. The website has long since become an authority on a vast number of topics, so customers now rely on reviews of the products they’re considering buying to help them make informed purchase decisions.
It also means that consumers have come to expect the same level of quality in Amazon Canada as they do on Amazon.com. Offering the same experience across various channels is crucial for your brand, and Amazon Canada allows you to reach a larger client base who have come to expect this high level of service.
As an entrepreneur, the best thing you can do is keep customers satisfied at all times. Your customers are the reason your business exists, so it’s important to constantly be thinking of ways to enhance their experience. With the expanding market that is Amazon, this represents an opportunity for small businesses, but only if you’re willing to put in the work.
A Consumer-focused experience
In addition to selling millions of products, Amazon now has a number of additional services designed to make shopping easier. You can subscribe to Amazon Prime for free shipping. There’s also a variety of delivery options including next-day, two-day and same-day shipping.
Amazon Canada shoppers have come to expect a high-level shopping experience, which includes multiple payment options. A single online purchase can include using a credit card, Amazon Pay, credit card or an Amazon gift card.
Not only does your inventory extend far beyond the few products that are selected by the retail chain, but it’s also available to all of your consumers, all the time. Since Amazon Canada is available to consumers across the country, it means more eyes on your products and larger target markets.
Use both Google and Amazon ads
Google Ads and Amazon sponsored ads are completely different. Amazon ads are more focused on product targeting users once they’re on the Amazon.ca site. You can include keywords in your ad copy, but they only work when the buyer is on Amazon.
Google Ads are different by comparison. These types of ads are highly focused on your branding. They are always running in the search engines, which makes them highly targeted to consumers who are looking for buying information.
Incorporating Google Ads into your strategy can help you increase your brand visibility. If consumers like what they see when they visit your website or find your product while searching the web, they may be more likely to go directly to your Amazon store. In essence, it casts a wider net for potential customers.
Both Google and Amazon ads work well together as long as you are consistent with your brand messaging. The Amazon ads are already targeted conversions, so it’s important that your Google Ads supplement the Amazon experience.
You may also want to consider using social media advertising to promote your brand. Social media ads are less expensive than Google or Amazon ads, but they can still produce a strong ROI. Think of it as an opportunity to get your brand in front of new buyers, and accomplish the same goals as ads on Google or Amazon.
The darker side of Amazon: how to Protect your brand in the digital marketplace
When it comes to protecting your brand, you need to think beyond the sale. There are many aspects of your business that need to be protected, especially when it comes to an online marketplace like Amazon. From your product images and descriptions to your position in the marketplace, you need to be prepared for any issues that arise when selling through Amazon Canada.
Amazon is e-Commerce
There’s no escaping Amazon. It’s not a gateway into e-commerce; Amazon is e-commerce. It’s almost a cliché to say that if you’re not selling on Amazon, you’re leaving money on the table. But it’s truer now than ever, since Amazon is so far ahead of the game.
Moreover, even if you’d rather not sell your products on Amazon, you’re still at a disadvantage. Someone can easily list your products on Amazon without your permission or knowledge. Why not stay on top of what’s happening with your brand? Use Amazon to your advantage by remaining active and taking full advantage of the sales opportunities it provides.
To maintain your presence on Amazon, it’s essential that you’re aware of potential problems. Whether it’s a third-party seller listing a counterfeit product, or a customer returning an item that wasn’t as described, you need to be prepared for any issues that could arise.
Succeeding on Amazon isn't easy
The truth is that it’s much harder to catch decent sales on Amazon and even harder to make a profit. Some agencies might promise overnight success, but that’s not the whole story. However, you shouldn’t count on overnight success. It can take weeks, even months, for you to start seeing results. You might not even make a dollar profit at first.
It’s essential to take the long view when you start selling your products online. If you’re realistic about how much money you’re likely to make and set the right goals, you will be more likely to stay motivated as you build your business.
The more experience you have with Amazon, the easier it will be for you to create ad campaigns that convert. Stay active on the site, monitor your sales and maintain an accurate track record of everything that happens with your brand. If you have solid, accurate data, it will be easier to spot the problems that need to be fixed right away.
While Amazon may not be a traditional marketplace, making sure your product gets seen by enough potential buyers remains key no matter where consumers spend their money online.
Having said that, Amazon isn’t impossible. There are many people who have successfully sold on Amazon by building their own brand and growing it firmly in the marketplace. The key is being well-prepared before listing your products and knowing what to expect while you’re selling on Amazon.
Protecting your brand in the Amazon Canada marketplace
Making money online is not easy, but it’s possible. When a brand creates a product that allows other people to make money without having to do much work, it’s called arbitrage.
If a brand has too many resellers on Amazon, they inevitably fight with each other to get sales. Because resellers promote the same product, price becomes the final defining factor. So, price-cutting becomes unavoidable and sometimes, it happens well below cost.
Amazon has been known to have a rooting interest in the competition between resellers. This is because it drives down prices for consumers, which means more sales and profit to Amazon. If you want to prevent reselling issues before they start, you need to protect your brand now while the problem is still small. How do you protect your brand? By enforcing your own distribution deals.
To track down resellers, consider hiring an agency to manage the process for you. Liability for the actions of your independent distributors rests on your shoulders. An agency can help you take action against resellers and distributors who might try to cut deals behind your back.
Foreign brands mean foreign competition
There’s no better way to become an established and respected brand than by building trust with your customers through reviews. Unfortunately, that applies to every brand on Amazon, including international ones.
When Amazon Canada was first launched, it allowed international brands to easily enter the Canadian market. Not only was the Amazon.ca marketplace a great opportunity for small entrepreneurs to make a living, but it was also great for international brands who wanted to enter a growing market.
Since Amazon Canada’s launch in 2012, many international brands have started to use Amazon’s platform to sell their products to Canadian’s. However, it’s important that they’re aware of any Canadian-specific requirements and restrictions in the marketplace.
When a brand from outside the Canada has many positive reviews and is priced competitively, they become much more likely to rank well on Amazon’s website. More over, if an American product does well in the USA, the algorithm will favour it on the Amazon.ca site as well.
This means that many foreign products can take over the Amazon Marketplace in Canada, and if a brand isn’t established enough to protect themselves, they will be run off the platform.
Many Asian brands have started selling directly to Canadian customers, and they do so at very low costs. The quality of these items is top-notch as well. Customers looking for a bargain won’t think twice about purchasing these items, and they can quickly become as popular than pricier Canadian brands.
Stay ahead of The curve with ProMerit
Finally, the truth is that Amazon Canada’s marketplace is rapidly growing and expanding. This means there is a huge potential for any brand, but they must keep up and be on top of their game to avoid being run off by competitors. If you are a Canadian brand that wants to compete with international brands on Amazon Canada, it’s important that you know your competition.
ProMerit’s Amazon marketing team is able to provide you with valuable insight into your competitors’ product pages. With this information, you will be better equipped to drive your own product pages to the top of the rankings and make more sales.
How to prepare for Amazon's growing dominance in e-Commerce
In the past, online shopping was something that people did when they couldn’t get to a mall or didn’t have time for a road trip. It allowed customers to shop from the comfort of their own homes, but it lacked human interaction.
This has changed over the years. The Amazon Effect has made online shopping much more personal. People are using the Internet to get in touch with brands, connect with each other about their purchases, and influence other people’s buying decisions.
This has made online shopping more social than ever. The personal touch that Amazon’s marketplace brings is especially powerful, and if you are not an established brand, it will be difficult to compete with larger brands.
How to run an Amazon business in the future
1. Plan for the long term
Amazon is known to be a champion of innovation and cutting-edge technology, but it has only just scratched the surface of what is possible.
The Amazon Effect is only getting stronger, and it’s important for your business to be prepared. Companies that are able to adapt, iterate and improve their solution are the ones who will be able to take advantage of Amazon’s innovation.
2. Get the basics right
Don’t let the idea of being an innovator scare you off. As long as you have a basic understanding of customer interactions, communication, and marketing, you will be able to keep your business relevant in the future.
To position your brand for success, make sure you have high-quality, professional product photos, and that you understand the basics of SEO and keyword research. Next, write descriptions that list the features and benefits of your product. Make sure your ratings and reviews reflect the value and quality of your product and brand. Finally, use enhanced content features such as A+ Content, video features like enhanced brand content (EBC) to make your product pages stand out.
3. Offer a great customer experience
One of the most important things to understand when selling with Amazon is that you are not in charge of the experience.
Amazon has its own policies, rules and guidelines that you must follow. Customers will also have their own expectations, and it’s your job to meet them.
You can do this by offering an easy-to-understand return policy, answering questions quickly, and accurately filling orders. Not only will this make it easier for customers to buy from you, but it can also improve your ranking on Amazon’s search results.
4. Optimize your product listings
You have an incredible opportunity with Amazon’s new features. The A+ program allows you to stand out from other brands on the site, making it easier for you to attract more customers.
As with any customer interaction, you need to meet their expectations in order to earn their business. This begins by customizing your product listings so that they follow Amazon’s rules and guidelines.
Brands can also create stores within the Amazon environment that function much like regular websites. Enhanced Brand Content (EBC) gives you the power to highlight your brand by allowing you to create videos, images, and text that can help customers understand your brand and what it stands for.
Finally, Amazon’s advertising platform is one of the best ways to drive sales directly through the site. Whether you are using sponsored ads or Amazon’s pay-per-click (PPC) advertising, it can be incredibly easy to generate leads and drive traffic directly to your product listings.
How to create an Amazon listing that converts
If you are looking for new ways to put yourself ahead of the competition, use these copywriting tips to help convert more customers:
- Use descriptions that clearly communicate the benefits of your product. Don’t focus solely on the features, but instead emphasize what they can do for the customer.
- Use persuasive language that addresses your customers directly, and motivates them to buy. Do your research and find out what types of words they are using to describe the products.
- Create a sense of urgency with a limited time offer, or limited quantity items. These encourage customers to act quickly.
- Use positive reviews as social proof that your product is worth buying. Optimize your listings to show the most helpful review first, and use a section for testimonials to highlight this proof.
- Take advantage of variations (like different sizes, colors, or higher quality model) to help improve your conversion rates and increase revenue.
Put these simple copywriting tips into action to help improve your product listings and build a brand that customers will love.
5. Listen to your customers
Customers want a relationship with your brand, and they want to feel like you understand them and their needs.
While it’s not your job to personally respond to every single one of your customers, you need to have a system in place to ensure that your marketing and customer service are accurate.
When customers make suggestions, use them as an opportunity to listen and improve your product. While you don’t need to do everything that every customer asks, it’s important to keep your relationship with them positive. Responding to comments and reviews can help you to keep your relationship with customers going, and can build trust.
Remember that Amazon can take down your listing or account if you have too many negative reviews or returns or if you don’t offer good customer service. Amazon also has a special algorithm that ranks products, and you don’t want your product to be ranked poorly because of negative customer feedback.
6. Approach Amazon listings with a growth mindset
There are always opportunities to grow on Amazon. Making data-driven decisions is always a good way to ensure that you are continuing to improve. As a seller, you have access to a wealth of data that you can use to monitor your product sales rank, conversion rates, and revenue. It’s also helpful to use the customer data that Amazon has collected to understand your buyers better.
7. Keep up with industry trends
The e-Commerce industry is always changing, and the same is true for Amazon. Stay on top of industry news and trends to make sure you know what is happening with your competitors and how that could impact your business.
The best thing that you can do for your business is to give yourself the time and space to focus on innovation, iterating, and improving your business.
Amazon is known to change the rules, and if you are not able to keep up with their innovations, you will be left behind. If this happens, work toward being ready to optimize your listings before you launch a new product.
You should also be prepared for the possibility that Amazon will change its policies and guidelines. This can happen anytime, so make sure you are always aware of what you need to do in order to succeed on the platform.
it’s also important to focus on what you can control. While it may feel like Amazon’s algorithms are the only thing that matters, there are other factors that can influence your sales.
Focus on improving your product listings, customer experience, and brand to make sure you are meeting the needs of your customers.
8. Counterfeit and fraudulent listings
There are a number of things that cause products to be removed from Amazon. This includes counterfeit products and infringing trademarks. Amazon has guidelines for its sellers to help them ensure that they’re selling authentic products.
If you see counterfeit listings on Amazon, you can report them by clicking on “Report a product” on the seller profile. If a trademark infringer has not been removed from Amazon after filing a complaint, you can escalate the issue by applying to Amazon’s Brand Registry. Brand Registry is a process of registering your brand with Amazon, which makes it easier for you to identify infringing listings using your brand name.
To avoid problems with your distribution agreement, make sure that selling on Amazon is clearly marked as unauthorized. If a reseller gets too close for comfort, then take immediate action and have them removed before things get worse.
Set yourself up for success on Amazon
Amazon is a key platform for selling your products, but there are best practices to consider when you first launch. The more prepared you are, the more likely you are to succeed on a platform that’s very different from others.
By following best practices, you can avoid common pitfalls and ensure that your business is prepared to sell successfully on Amazon. Contact ProMerit today for more information on how we can help you grow your business on Amazon Canada.