Brands Report A Seven Times Return Rate From Advertising on Amazon, According to New Feedvisor Survey
With brands reporting e-marketplaces as a top priority selling channel, Feedvisor provides the holistic solutions and insights brands need to optimize their advertising, pricing and inventory strategy on leading e-marketplaces
Feedvisor, the “AI-first” optimization and intelligence platform for brands and sellers on Amazon and e-marketplaces, announced the highly anticipated results of its fourth annual brand survey. The 2022 report, “Brands, Amazon, and the Changing Landscape of E-Marketplaces,” documents more than 1,000 U.S. brands — from direct-to-consumer to Fortune 1000 companies — and their unique relationships with e-marketplaces and Amazon.
“Brands, Amazon, and the Changing Landscape of E-Marketplaces”
The report highlights a wide range of topics of importance for brands, examining their advertising and media strategies, expansion plans, the supply chain’s impact on their businesses, as well as specific challenges and opportunities. The number one takeaway? E-marketplaces are critical to a brand’s retail success. Related survey findings include:
- E-marketplaces remain a priority channel: As consumers continue to favor efficient shopping experiences, 42% of brands ranked marketplaces as the greatest e-commerce opportunity, along with social media (46%) and mobile (43%).
- Brands continue to primarily leverage e-marketplaces to drive sales and new customer acquisition, but brand-building is a growing opportunity: Nearly half of brands (46%) leverage e-marketplaces to drive sales, followed by acquiring new customers (45% up from 38% last year) and building brand awareness (45%). This indicates brands are seeing the need for diversification to reach as many potential customers as possible in their shopping journeys.
- Holidays are still a strategic source of growth for e-marketplaces: 42% of brands selling on e-marketplaces reported an increase in holiday sales despite inventory shortages. And 42% also ranked Black Friday as the best performing occasion on e-marketplaces with Cyber Monday (21%) and Thanksgiving (17%) falling behind.
As a leading e-marketplace, the report also highlights how brands are leveraging Amazon as an engine for growth and retail success. For example:
- Brands see Amazon as a growth engine: 96% of brands agreed that the best part of selling on Amazon is the increased sales volume, and nearly half of brands (45%) take advantage of Amazon in their current retail strategies.
- Amazon is viewed as a launching pad for brands: 44% of brands said they launch new products on Amazon. This indicates that brands rely more on Amazon for testing new products while simultaneously leveraging other e-marketplaces to achieve different business objectives, like selling surplus or end-of-life products.
- Brands are deploying a number of Amazon-specific tactics: 49% of brands used Fulfillment by Amazon, 48% used Amazon Advertising and 43% used Amazon free returns in 2021.
E-marketplace Advertising Becomes Priority for Brands
From lingering pandemic shutdowns to supply chain disruptions and inflationary concerns, brands are doubling down on their advertising strategies on e-marketplaces to rise above the competition.
“Supply chain logistics (38%), changing customer demands (33%) and shipping and fulfillment challenges (29%) are now top-of-mind for brands and sellers. While it is critical that today’s brands overcome these challenges, they cannot afford to sideline the pricing and advertising strategies that acquire and retain customers,” said Dani Nadel, President and COO, Feedvisor. “Success on crowded e-marketplaces like Amazon, Walmart and Google will come down to how well the brand understands the platform and the opportunities within it. As the leading experts in this space, we have structured both our Brand Services team and our advanced technology platform, Feedvisor360, to provide expert-level support to both 1 brands and 3P sellers to ensure our customers always outpace the competition.”
When asked about top advertising priorities on e-marketplaces, brands identified the following:
- Amazon Advertising works: 58% of brands reported seeing “great value” in Amazon Advertising, the highest percentage to date.
- Top bracket spending on Amazon Advertising has increased: More than one in five brands are spending $100,000 or more per month on Amazon Advertising.
- New advertising opportunities are emerging: Mobile remains a digital ad format perceived to have the greatest ROI, followed by desktop and video.
- Brands are investing in video advertising: 44% of brands now use Amazon video ads. As a result, video ads and custom advertising solutions have eclipsed Sponsored Products, Sponsored Display, Sponsored Brands and Amazon DSP Display Ads as the most frequently used type of Amazon Advertising.
Feedvisor Expands Brand Services @ Feedvisor
With so many confounding factors impacting a brand’s chance at success on e-marketplaces, the report highlights the importance of using data-driven e-commerce analysis and marketplace optimization. Feedvisor’s Brand Services team and proprietary platform is the leading solution for brands in today’s hyper-competitive e-commerce environment.
Brand Services @ Feedvisor is a boutique e-retail group within Feedvisor that is purpose-built to deliver unmatched Amazon expertise together with Feedvisor’s market-leading technology, processes and data to Fortune 1000 brands on Amazon. This team gives brands direct access to the market leaders, with a proven track record of helping brands win in the world’s largest retail marketplace.