Amazon is a liberal marketplace that allows sellers of all types to enter the retail industry — for some, that means selling goods as a third-party vendor. This is how businesses end up with their brands represented on Amazon, even if they don’t list products there. E-commerce isn’t about manufacturing, only selling, so many enterprises use different products and brands to expand their efforts in this global marketplace.
Unauthorized retailers present a unique challenge for businesses looking to defend their brands and profit from their own e-commerce sales. Amazon does not take responsibility for unauthorized sellers. It’s up to businesses to find ways to protect themselves — and that takes a working brand strategy.
1. Be an Amazon Vendor
This allows your business to represent its brand on the platform. There are two primary options for Amazon retailers:
- Vendor Central
- Seller Central
The company that utilizes Vendor Central is the recognized first-party seller providing products to the marketplace as a wholesaler. Consumers will see the label: “Sold and Fulfilled by Amazon” when purchasing. The company works exclusively with the Vendor Central platform, and Amazon takes responsibility for managing inventory and fulfilling orders.
The other option labels your business as an independent seller and provides less brand defense. This option means the company takes all responsibility for managing its products, including maintaining inventory levels and servicing the customers.
Both the Vendor and Seller platforms offer Prime shipping as well as merchant-fulfilled and Amazon-fulfilled inventory options for sellers that meet the requirements.
The Vendor Central program is by invite only. Amazon looks for businesses with high-volume sales for this platform — but Amazon also has a third option for those that can’t meet all these requirements. Vendor Express is a hybrid program that has less stringent guidelines for brand owners. Amazon handles the shipping and customer service with this plan.
2. Create a Strong Focus for Your Brand Identity
Consumers don’t always know who owns a brand, so it’s up to each business to make it clear. Set up and manage a public website for your brand to establish your ownership of it. With proper optimization, the website should pop up on organic searches over third-party Amazon retailers.
Make a point of physically labeling each product with the brand name or logo to further enhance that focus. This is useful if you need to pinpoint counterfeiters, too. Both of these steps are requirements when applying to the Amazon Brand Registry, as well.
3. Enroll in the Amazon Brand Registry
The Amazon Brand Registry program allows businesses to identify themselves as the brand owners in an easy and recognizable way. It is one Amazon brand protection tool that defends owners from third-party sellers. Once enrolled, you’re given access to tools that help protect your intellectual property and copyright, and can more powerfully apprehend unauthorized sellers that are misrepresenting your brand on Amazon. By certifying your company as the brand owner, your product details trump any keywords or descriptions the other third-party sellers might attempt to use. This only works if you properly enroll each product, though, so having a consultant familiar with the process further enhances your brand protection.
4. Understand That Amazon Supports Third-Party Retailers
Amazon is built on the concept of multiple retailers, so it will not intercede when it comes to unauthorized sellers. The multiple-vendor setup allows for a competitive pricing environment that attracts buyers. It’s critical that businesses understand Amazon’s position on this because it will not work to police each brand. It’s up to individual companies to find ways to protect themselves by having trademarks and engineering strategies for public acknowledgment of their brand ownership.
5. Set Limits for Distributors, Resellers and Retailers
Businesses that want explicit rights to represent their brands on Amazon may need to enact stricter agreements with their distributors, resellers and retailers, or to develop a stringent MAP (Minimum Advertised Pricing) policy. The first approach stipulates that these secondary enterprises cannot sell the brand on Amazon, allowing for just one authorized seller on the platform.
The second requires you to create a MAP to control the pricing. MAP policies contractually restrict advertised pricing below a specified rate by authorized third-party sellers. An enforced MAP plan protects your business from being undercut on Amazon.
To ensure full compliance with these two protections, companies can add serializations to their products. Serialization allows brand owners to easily identify any business that violates their terms.
6. Take Precautions if Using Amazon’s FBA Program
FBA (Fulfilled by Amazon), is a program that allows each company to ship its merchandise to Amazon. Amazon will then fulfill each order. The alternative is the Merchant Fulfilled option where the business ships directly to the customers. When participating in FBA, sellers can choose to not use Amazon barcode labels on their products. This puts you at risk for counterfeiting, because the order packers may mix counterfeit products with your original brand items. Poorly made counterfeits will reflect on the brand and negatively impact its online reputation.
7. Create a Reactive Strategy to Handle Unauthorized Sellers
This requires someone monitoring the Amazon marketplace to identify unauthorized sellers. Once identified, the brand owner would issue a message via Amazon that instructs the seller to cease and desist. In some cases, it is necessary to make a purchase to prove a product is counterfeit, allowing the brand owner to file a grievance with the marketplace in an attempt to shut the seller down. It’s a brand protection strategy that is time consuming, so consider outsourcing the effort to a consultant with the expertise to handle these tasks.
Your brand may be at risk on Amazon whether you know it or not. Third-party sellers impact brand effectiveness on the world’s largest e-commerce site unless businesses take defensive steps to prevent this intrusion. Finding the right brand strategy to police your products on Amazon is time consuming but essential. A bad customer experience will impact your bottom line, even if your company wasn’t involved. In some cases, it may not even be your product, but a counterfeit sold under the brand label.
Digital Brandworks partners with Amazon sellers to protect their brands and create divisive Amazon brand protection plans to market their products in a safe, efficient and cost-effective manner. Reach out to us today to learn more.