Why (and How) Amazon Seeks to Seduce Small Traders

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At the end of January 2019, Amazon kicked off the 2nd edition of the Amazon Campus Challenge. Principle of the competition: 450 Master’s students grouped into more than 100 teams, in partnership with as many VSEs and SMEs, who are launching and managing their own shops until May. If this challenge offers students a chance to acquire e-commerce skills, for small French companies, it’s a way to take the next step while benefiting from Amazon’s know-how in terms of logistics, sales and marketing, explains the e-merchant.

It is an understatement to say that third party vendors are a real challenge for the e-merchant, who develops via its marketplace a battery of tools to help them launch or consolidate in e-commerce. The marketplace is at the heart of the customer experience offered by Amazon, announces Patrick Labarre, Director of the Amazon France marketplace, whom Usine Digitale was able to meet during the Salon des Entrepreneurs on February 7, 2019. Patrick Labarre was there alongside SMEs who were demonstrating the benefits of a presence on the marketplace.

Over the past two years, Amazon has multiplied the creation of thematic spaces within its platform for them: a space for start-ups specializing in connected objects, another virtual corner dedicated to handmade objects, called Amazon Handmade and last year a shop for small producers. A way to address more personalized spaces to professionals attached to their image, and often not very familiar with Amazon’s service offer. The transition to e-commerce is sometimes perceived as costly or complicated, continues Patrick Labarre. Now, we have very simple tools for an affordable price (39 euros monthly, editor’s note) to accompany them in their desire to sell online and internationally.

A positioning as a service provider

This is the case of Amazon’s Shipped by Amazon service, which helps them develop their business in France but also internationally by relying on Amazon’s logistics resources (storage, collection, packaging and shipment of their stock throughout Europe), as well as its customer service A service that can lift an apprehension related to logistics issues, amplified during commercial highlights. Start-up Dodow, for example, which sells sleep activators, has used this service to ship its orders to Canada and Australia. Products also become eligible for Amazon Prime giving them access to millions of Amazon customers.

It is the notoriety of this true positioning as a Service provider that the American company is seeking to increase. Alongside a television campaign last autumn featuring one of its salespeople, the e-merchant went out to meet VSEs and SMEs as part of Amazon Tour, in Paris and in major provincial cities. The objective of these tours: to explain how Amazon can help small and medium enterprises to sell their products online via its interface.

Among the examples cited by the e-merchant, Dodow made half of its online sales on the Amazon Marketplace in 2018, i.e. 101,742 products sold, for a turnover of 4.3 million euros Vertbaudet, for its part, sold 14,000 items in France, Germany, Spain, Italy and Great Britain with a presence among Amazon Prime members. We have strengthened our presence in Europe by adding to our own international sites and can now offer Prime customers one-business day delivery through this channel, while our sites provide standard three-business daydelivery, Vertbaudet explains. For Amazon, it’s touching on a dream that many large e-merchants dream of achieving: a comprehensive offering and an exponentially growing number of sellers.

Delay of French SMEs in e-commerce

But the path is not easy, even when you’re called Amazon. In addition to a lack of awareness of its tools, the company has to face a certain delay from French e-commerce merchants. According to the Conseil National du Numérique, only 16% of French SMEs and VSEs were selling online in 2015. This rate places France 13th in Europe. Although the Amazon France marketplace claims 10,000 third-party sellers (the same figure as in 2014, editor’s note), it is still far from its German version, which counts 75,000 sellers to date. The same applies to exports. According to Deloitte, only 8% of French companies sell online to consumers in other European countries, compared to 10% of German companies.

Offer more products from French manufacturers

The American giant is facing another difficulty. He has been accused, because of too rigid rules, of too brutally dereferencing his salesmen. In the summer of 2018, Caurette, an Alsatian publishing house, recorded a 20% drop in turnover for four months, particularly abroad, due to its abrupt deregistration, prompting an official reaction from Mounir Mahjoubi, Secretary of State for Digital Affairs, who in November 2018 called on French professionals who were having difficulties with Amazon to report it to the government. It’s a good thing, analyses Stéphane Jauffret, President and co-founder of SellerMania, a company that supports SMEs and brands on marketplaces, and first director of the marketplace, launched in 2003. On the one hand, Amazon puts customer satisfaction first, and is therefore very demanding with its salespeople, who have to play by the rules of the game. On the other hand, some merchants make their entire turnover on Amazon, and can find themselves in a delicate situation. A constable is therefore required. The European Union is also seeking to regulate the relationship between platforms and their sellers and is working on a regulation that could be adopted in the coming months. For his part, Patrick Labarre says: The trader keeps track of his products, prices and stock.We ensure that it meets its commitments in terms of product quality and delivery times.

One thing’s for sure: Amazon has been multiplying its actions with regard to small French retailers, aware of the need to establish a relationship of trust with this typology of actors… but also to be able to offer its customers products from French manufacturers, at a time when Chinese products are arriving in large numbers and can raise questions in terms of regulations and quality. Amazon knows that quality and durability of products are nowadays real demands fromconsumers,” adds Stéphane Jauffret. A strategy that also enables it to attract a Chinese clientele eager for French products and to attack Alibaba and JD.com, which are putting the necessary resources into developing in France.

To win over even more professionals, the platform will expand its offer and now aims to facilitate sales of heavy and bulky products. Some companies are afraid to go because they fear that Amazon will not be adapted,concludes Stéphane Jauffret. However, there are solutions and a real opportunity to be among the firstvendors.




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