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Amazon has been crowned a revolutionary platform for many small to medium-sized businesses and online retailers looking to increase the visibility of their products. This eCommerce marketplace has attracted sellers with its wide-ranging reach and reputation. However, sellers on Amazon make sacrifices to sell through this behemoth.
Selling your products directly to the consumer (some say DTC sales, others say D2C—potato, po-tah-to 🥔) gives you more control over distribution of your products.
Sellers get a choice between two plans: Professional and individual. Both plans have a subscription fee and a selling fee for each item that sells through Amazon. As a seller, you get to decide what service to use to dispatch the items. There’s also another option (not-so-secret option C), the FBA aka Fulfillment by Amazon. And, you guessed it, it comes with a fulfillment fee attached.
Don’t get us wrong. FBA has a ton of perks. Picking, packing, shipping, and handling. This comes in super handy when you’re dealing with returns (or more accurately when you don't want to deal with returns, so Amazon takes care of the hassle).
Overall, sellers use Amazon to boost sales because they believe it’s a good solution to one or more of their pain points, whether that be inventory management or audience reach.
At some point, you probably thought about Amazon and worried that you might be losing money by not showcasing your hard work in the marketplace. After all, your target market is definitely lurking there looking for exactly what you’re dealing in right now. Let’s take a look at some of the positive and negative points of marketplace selling vs. direct-to-consumer transactions.
While you shouldn’t completely demolish your listing on Amazon after reading this post (unless you find it isn’t making a big difference in your revenue), you should consider making a switch to direct-to-consumer sales.
Diverting resources from Amazon to set up a D2C model will help you take steps toward full control over your sales. You get to work on building a competitive edge on your own terms, and as you grow your business you are also growing a brand.
Here are some tips on how to do D2C right: