automechanika follow up1

Amazon 101:Grow your business with Amazon

AMAZON EU SARL CONFIDENTIAL© 2012 Amazon.com, Inc. or its affiliates

1. Confidential Information. As used in this Agreement, “Confidential Information” means all nonpublic information relating to Amazon or disclosed by Amazon to the above-referenced company, its affiliates or the agents of any of the foregoing (collectively, “Supplier”) that is designated as confidential or that, given the nature of the information or the circumstances surrounding its disclosure, reasonably should be considered as confidential. Confidential Information includes, without limitation (i) all nonpublic information relating to Amazon’s technology, customers, business plans, promotional and marketing activities, finances and other business affairs, and (ii) all third-party information that Amazon is obligated to keep confidential. Confidential Information may be contained in tangible materials, such as drawings, data, specifications, reports and computer programs, or may be in the nature of unwritten knowledge.2. Exclusions. Confidential Information does not include any information that (i) is or becomes publicly available without breach of this Agreement, (ii) can be shown by documentation to have been known to Supplier at the time of its receipt from Amazon, (iii) is received from a third party who did not acquire or disclose such information by a wrongful or tortious act, or (iv) can be shown by documentation to have been independently developed by Supplier without reference to any Confidential Information.3. Use of Confidential Information. Supplier may use Confidential Information only in pursuance of its business relationship with Amazon. Except as expressly provided in this Agreement, Supplier will not disclose Confidential Information to any person or entity without Amazon’s prior written consent. Supplier will take all reasonable measures to avoid disclosure, dissemination or unauthorized use of Confidential Information, including, at a minimum, those measures it takes to protect its own confidential information of a similar nature. Supplier will segregate Confidential Information from the confidential materials of third parties to prevent commingling. Supplier will not export any Confidential Information in any manner contrary to the export regulations of the United States.

Confidentiality: The Short Version

»Information we are sharing with you is confidential

»We want you to learn more about our business

»We ask that this presentation and its content be shared only with persons inside your company who have a need to know

2

AMAZON SERVICES CONFIDENTIAL© 2012 Amazon.com, Inc. or its affiliates

Agenda

»Retail is Evolving

»The Vision

»Why Amazon

»Myths vs. Reality

»Work with US3


E-Commerce Growth Driver

Consumer shopping behavior is changing

RETAIL IS EVOLVING

TIME

4


The State of e-Commerce

E-Commerce growth

significantly

exceeds the growth of total retail-comScore, August 2011

14%

3%

Retail Growth1E-Commerce Sales Growth1

Q4 2011 YoY Growth

Source: 1. ComScore “State of the U.S. Online Retail Economy in Q4 2011,” January 2012; Note: Retail growth does not include auto sales, gas, or food and beverage.

5


Online Research Influences Offline Sales

2012 2013 2014 2015$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

43%

44%

45%

46%

47%

48%

49%

50%

51%

52%

53%

$218 $239 $259 $279 $1,229 $1,347 $1,458 $1,553

46%

49%

51%52%

Web-Influenced Retail Sales(000) Online Retail Sales US online and Web-influenced retails sales as a % of total sales

Sources: Forrester Research Web-influenced Retail Sales Report, 2010 to 2015 (US), Jan 2011

6


Decision

Ecommerce Empowers Customers

7

Traditional Distributor

End User

E-Commerce

End User

Decision

Garage


Top Global Retailer Brand

Sources: Millward Brown Top 100 Most Valuable Global Brands 2011

#1 Global Retailer Brand:

8


>$50 $50-$200 $200+

36%

27%

37%

Amazon’s Large and Active Audience

Monthly Unique Visitors (US):

90MM

Avg. Visits per Visitor (US):

5.2

Active Global Customer Accounts:

173MM

Avg. Daily Unique Visitors (US):

11.1MM

Note: Active Customer Accounts are unique email addresses that have placed an order in the last 12 monthsSources: 1. Amazon Investor Relations; 2. ComScore PlanMetrix March, 2012.

12 2 2

8%

37%

22%

33%

0-18 18-34 35-44 45+ <$25K $25K-$75K $75K +

14%

46%40%

Household Income of Amazon Unique Visitor’s2

Age Composition of Amazon Unique Visitor’s2

% of Amazon Shoppers Who have Made an Online Purchase2

Amount Spent

9

'02 '03 '04 '05 '06 '07 '08 '09 '10 '11$

$10,000

$20,000

$30,000

$40,000

$50,000

Media EGM Other

Net Sales History

Sources: Amazon Investor Relations

$3.9$5.3

$10.7$8.5

$14.8

$19.2

$24.5

$6.9

$34.2

$48.1

10

Mill

ions

$

Growth in sales YoY (2010-2011)

41%


Much More Than a Bookstore

11

Electronics & General Merchandise now account for

64% of Net Sales (as of Q2 2012)

In Q2 2012, Worldwide EGM was $8.16 billion


—Jeff Bezos

start with the

customerand work backwards

12


Amazon’s Vendor Vision

Create strategic, long-term vendor relationships

enabling our virtuous cycle of

value, selection & convenience

13


Part Finder on Amazon.com

14


Part Search Results

15


Part Detail Page

16


Full Selection

Part finder allows customers to find every possible part out of millions of application specific

parts

Offering your full selection on Amazon is important: if your part is not there, somebody

else’s will be

17


Full control over your product information

18

100% on-message, all day, everyday, 24/7/365


Customer Reviews

of consumers read product reviews

when considering a purchase

19

Increase trust in your brand and improve your sales

92%

Source: Channel Advisor Consumer Shopping Habits Survey 2010


How does Amazon promote Brands

20

Search Engine

Marketing

Search Engine

Optimization

Vine Community

Affiliate Marketing

Amazon Prime

Email Marketing


Myth vs. Reality

21

Amazon

brands.premium doesn’t sell


Myth vs. Reality

22

Amazon is a:A. RetailerB. Marketing ChannelC. Research DestinationD. Digital Content

Provider

E. All of the Above


Myth vs. Reality

23

I do not plan to go on-line

You are on-line. At Amazon you have full control

over the customer

experience


What’s next?

• Sign terms and conditions using Amazon Vendor Central

• You create all detail pages in 5 languages in Amazon Vendor Central

• Amazon makes initial stock-up PO based on your advice

• Additional inventory is ordered based on customer demand and customer visits to your detail pages

24

For more information contact » Michal Bohosiewicz – Sr. Vendor Manager

» +352 691 999 864

» [email protected]

APPENDIX


Adjusting Your Strategy for Online Retailing

27

Amazon Differences Winning Manufacturer Approach

1. New Retail Channel Redesign your partnering strategy to reflect the new channel needs

2. Online Shelf Invest in appropriate “e-packaging” for your customers

3. Consumer Direct Supply Chain Optimize for the radically different product flow

4. Merchandising and Marketing Environment

Leverage the Amazon customers/viewers to the fullest extent

5. Platform for Innovation Exploit the Amazon platform to create new capabilities, products, or businesses

Amazon is Different: successful vendors who partner with us keep these differences in mind.


Pitfalls to Avoid

28

Common Pitfalls Considerations

Simply offering the same products and merchandising material developed for offline channel

-Make your entire assortment available on Amazon-Ensure appropriate packaging-Provide thoughtful and extensive digital content-Submit products well in advance to allow for pre-order

Not reallocating funds from unused offline-focused activities

Funds and resources available for reinvestment include:-Slotting Fees-Field support for in-store execution-Physical promotion support (mods, shippers, displays)-FSI coupons

Underfunding new activities or new services not offered by offline retailers

-Support free shipping for heavy/bulky items-Take advantage of Amazon advertising opportunities-Invest in Subscribe & Save, Free Financing, etc.

Failing to take advantage of online efficiencies

-Avoid unfavorable “Channel” terms-Reconsider order minimums to optimize for the new flow-Offer returns, damage, and expired product allowances

Web-savvy manufacturers have learned to avoid these common errors


Keys to Your Success

Keys

Give us best-in-class support by assigning your “A” Team…direct contacts to Marketing, Merchandising, Brand, and Logistics teams

Leverage Amazon.com as a customer education and marketing channel, not just a retailer

Ensure that we have full-line selection

Optimize your “e-packaging” by loading your richest content

Partner for logistics integration to ensure high “in-stock” levels

Launch new products in advance on pre-order

Leverage cross-category branding opportunities

Avoid complex and hard-to-implement policies

Use our customer base for product and market input

Use our analytical tools in conjunction with your offline efforts

29

Collaboration Supports Both Online and Offline Sales

automechanika follow up1

Technology

confidential materials

usamazon services confidential

nonpublic information

thirdparty information

businesswith amazon

amazon investor relations

auto sales

online retail economy