Amazon Sellers 101 – How to Know the Difference Between Good and Bad Sellers on Amazon

Spotlight Brand Services Amazon Optimization Experts Good Versus Bad Sellers on Amazon

When selling your product(s) through any sales channel, including Amazon, one of the most common mistakes a brand will make is thinking that the more sellers they have, the more successful their product(s) will be. We are here to tell you that is simply NOT TRUE!

Especially when selling on Amazon.

More sellers do not drive more customers to your Amazon listing. More sellers do not mean more sales.

Let’s say it together:

“More sellers do not drive more customers to your Amazon listing.”

“More sellers do not mean more sales!”

Let’s take a minute to think about this logically.

By having multiple sellers carrying your products on Amazon, you’re actually competing against yourself, advertising to customers in the exact same space, which increases your cost of customer acquisition. So, by having more sellers, you’re making it much more likely that customers won’t find your product(s).

Now, let’s examine the difference between having good sellers and bad sellers, and how both affect your brand.

What is a "Good Seller" VS a "Bad Seller"?

First, let’s start by defining what a “Good Seller” or “Professional Seller” is versus a “Bad Seller” or “Unprofessional Seller”.

A “good seller” is someone who understands your brand’s vision and is knowledgeable about your products. They answer customer questions correctly, properly and in a timely manner. They understand the importance of delivering a great customer experience and the negative impact it can have if they do not. They follow the steps that are put in place by you to deliver the amazing customer experience 100% of the time. They serve as an ambassador to your brand, often finding ways to help new customers find your products and put your customers first before themselves and their profits.

A “bad seller” is often confused with someone who actively hurts your brand. Often, these sellers don’t actively do much of anything outside of place orders with you and list your products for sale. They don’t make an extra effort to promote a great customer experience and do the bare minimum to not get their account suspended on Amazon. Their only concern is the money they make, and they do it at the expense of your customer’s experience.

Bad sellers are under prepared and don’t understand what steps they can implement to positively impact the experience they’re delivering to their customers. They don’t know how to run impactful advertisements to drive traffic, how to create a quality Amazon Listing that converts, or how to get the right pictures on the listing that are going to lead customers to purchase your product. They don’t know how to get the right copy in the listing to ensure the correct customers are finding your product. And they don’t follow-up with customers who have had a poor experience and help repair the possible damage it can have on a long-term customer relationship. Ultimately, they don’t know how to positively impact and protect the brand. They take up space and allow negative experiences accumulate through their lack of interest in solving customer problems.

How Can You Identify a “Good Seller” Vs “Bad Seller”?

At Spotlight Brand Services, one of the ways we identify a “bad seller” is when they speak about the brand and what it needs in a very segmented way. It’s one of the first signs that they are an inexperienced seller.

For example, if they talk to you exclusively about ads, as opposed to all of the promotional opportunities that are available on Amazon, they aren’t getting the full picture. They don’t understand all the components needed to be selling successfully on the Amazon Marketplace. They’re not utilizing all their resources and running ads plus coupons, plus cross sales, plus sponsor displays, plus video ads, etc.

We don’t think that these sellers are necessarily trying to be bad, but by being under equipped and under prepared, they are unable to deal with real problems and ultimately don’t have the skills or expertise to drive traffic to your product(s) and grow your brand. The Amazon environment is hyper-competitive and if you’re not gaining ground, you’re losing it.

Conversely, a professional seller systemizes everything. A good seller is going to create the best possible experience for a customer and replicate that repeatedly to guarantee 100% satisfaction each and every time. They want every customer to enjoy the product for what it is and does, as opposed to how fast it arrived. And more importantly, they are invested in driving sales and creating ways to land attract and convert long-term customers.

They are doing this by leveraging resources, leveraging expertise to create benefit for your brand, beyond simply placing an order. Most professional sellers are using a full suite of tools to drive business, because everything is incremental on Amazon. By utilizing the necessary tools and understanding the impact they make working together, a professional seller can increase the sales of a product quite substantially, because the sum of all of those actions is greater than any one of them individually.

How Can I Prevent Unwanted Sellers from Selling My Products?

So, we’ve defined a “Good Seller” vs a “Bad Seller” and how to identify both. Now, let’s talk about how to prevent unwanted sellers from selling your products.

The first and absolutely crucial way to prevent unwanted sellers selling your product is by knowing who all of your sellers are. This may seem super simple and obvious, but I can’t tell you how many clients come to Spotlight Brand Services trying to understand why there are so many people selling their products and do not know who they are.

If you don’t know who all of your current sellers are, the first step is to reach out to the unknown sellers on your listing to find out who they are. This can be tedious and very tiring as you’re always going to be chasing people down, but it can be well worth it and lead to a much brighter future for your brand.

If you can, it’s much better to implement the correct documentation in the beginning of the process. This documentation should outline the specific uses of your IP and how it is able to be used within various channels. This will help ensure that right from the start, people are following your rules to keep your brand protected and growing strong.

Another way to prevent unwanted sellers from selling your product is by controlling the method in which a seller can acquire your products in the first place. It is crucial to know at what point they can obtain your products within your supply chain and who is buying the product. Understanding how a seller can acquire your products is crucial in protecting your brand from these “bad sellers”.

Unfortunately, there really isn’t easy way to get unwanted sellers off of your listing. At Spotlight, we work with brands to do this; however, it is a tedious, cumbersome, and imperfect process. The only way to really protect your brand is by being proactive from the start and having all the proper tools in place to help you do so. If you’re living in a constant state of reaction, you’ve probably realized that you are fighting an uphill battle. The sellers don’t stop coming and Amazon isn’t much of a help. Amazon will never take a seller off simply because you don’t want them carrying your product, unless they are strictly violating a rule that would affect Amazon’s customer experience. So, it’s incumbent upon you to manage your supply chain and protect your brand.

How Can Unwanted Sellers Affect My Brand?

As we discussed in previous posts, there are multiple forms of advertising on Amazon, but sellers can only engage in advertising when they have the Buy Box.

What is the Buy Box you ask?

The Buy Box is the white box on the right side of the Amazon product page, where customers can add items for purchase to their cart. It’s important to note that not all sellers are eligible to win the Buy Box. Due to stiff competition and Amazon’s customer-centric approach, only businesses with excellent seller metrics have a chance to have this feature on their listing.

Now, the Buy Box rotates amongst sellers depending on price. This opens up the possibility of multiple sellers running ads to the same customers — which we discussed earlier — can negatively affect your traffic and sales. Having multiple sellers also opens you to the risk of some sellers who are running advertisements and some who aren’t – causing periods where your products are not being advertised and not reaching potential new customers at all!

You definitely don’t want that!

Another problem with having multiple, unwanted sellers, is that it can actually drive-up advertising costs.

As an Amazon seller, you always want to ensure that you have the best ad strategy in place – optimal performance, at the cheapest possible price, while attracting the most “right-fit” customers. Adding more sellers will actually hinder the performance of your advertising strategies and hurt your sales.

Let’s imagine you and another seller have a couple of similar SKUs and are both running ads, for different SKUs, but using the same keywords. By doing this, you are actually competing against each other for the same keywords. The result is increasing your advertising costs and your cost of customer acquisition. Even worse, this scenario makes it much less likely that you’re going to continue to be able to reach potential new customers.

Now, we know a lot of work goes into acquiring new customers on Amazon and we just discussed how it can be even harder with more sellers. So, after all that work, do you want to also increase your chances of losing them? It makes no sense, right?

The hallmark of any retail establishment, big or small, brick and mortar or online, is for their customers to have a great experience, 100% of the time.
Consistency is key!

Why do you think Amazon has grown so much and their customers are so emboldened to continue to buy from Amazon? It’s because they have a convenient and friction-free experience every time. They receive their orders in a timely manner, they receive their orders professionally packaged, and often, they get them in two days without any questions or hassle. You don’t want a seller representing your brand who is not a professional, who doesn’t package your product correctly, or able to answer customer questions correctly.

One of the first ways unprofessional sellers try to cut corners is by trying to figure out how they can save money. The first areas they focus on is logistics. What they don’t understand is that by taking a shortcut and not packaging/shipping customer’s order the right way, or prepping their products correctly for shipment to Amazon, they’re actually reducing the likelihood that a customer is going to have a great experience with that product (your product) and makes it much less likely that they will purchase from you again.

Furthermore, when bad sellers providing a poor customer experience it increases the chances of the customer leaving a negative review , which can have a lasting black eye for your brand. It affects your social proof and the positive star rating that you worked so hard for. This can all have a very negative effect, not just on them as the seller, but more-so on you, your product…and your brand!

The truth is that having any sellers means that you don’t control the customer experience, and having multiple sellers results in further inconsistency that is likely to result in even more negative experiences. If you’re working with sellers, it’s imperative that you are working with seller’s who understand your vision and have your best interests in mind.

If you’d like more information or assistance in learning more about Amazon sellers and how to identify the good sellers vs bad sellers, click the button below to schedule a FREE Amazon Product Listing Audit and one of our Spotlight Brand Services Brand Strategy Specialists will meet with you to help you start growing your business on Amazon.