follow the customers: selling on amazon & ebay & webstores

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Follow the Customers: Selling on Amazon, eBay and Webstore Michael Levit - Vendio EVP Marketing August 9, 2010 @Vendio @Levitmc #eCommerce

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Michael Levit of Vendio.com presented this session to attendees of the Internet Merchants Association & ASD attendees on August 9, 2010 in Las Vegas.

TRANSCRIPT

Page 1: Follow the Customers: Selling on Amazon & eBay & webstores

Follow the Customers: Selling on Amazon, eBay and Webstore

Michael Levit - Vendio EVP MarketingAugust 9, 2010

@Vendio@Levitmc #eCommerce

Page 2: Follow the Customers: Selling on Amazon & eBay & webstores

Agenda-ish

Why am I Talking to You

eCommerce Industry Overview

The Goliath’s – eBay and Amazon

Other Marketplaces

Emerging Channels

Storefronts

Page 3: Follow the Customers: Selling on Amazon & eBay & webstores

Vendio Introduction

Leading On-demand eCommerce platform for small and medium sized merchants (SMM)– 70,000 merchants selling over $1.5 Billion of goods annuallyIncorporated in 1999, headquartered in Silicon Valley– Offices in Romania and India– ~70 employees worldwideMulti-channel eCommerce Platform offering – Customizable fully-hosted online store– Inventory, channel & business management solutions– Reporting & analyticsDealio.com – Vendio’s comparison/social shopping siteAcquired by Alibaba.com last month – Now enabling B2B2C

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Page 4: Follow the Customers: Selling on Amazon & eBay & webstores

Sales Volume of Select Customers

$865,000

$447,000

$430,000

$1,000,000

$770,000

$2,000,000

$1,900,000$1,000,000$4,665,000

The Digital Oasis

$1,225,000

$1,140,000

$1,150,000

$3,283,000$673,000

$2,175,000

$1,611,000

$1,952,000

$935,000$1,023,000

$1,075,000

$802,000

$953,000

$945,000

$1,432,000

In aggregate, Vendio merchants generate >$1.7 Billion in annual sales

Page 5: Follow the Customers: Selling on Amazon & eBay & webstores

Growth Continues in eCommmerce…

U.S. eCommerce - $128 billion projected to grow at a 8% CAGR from 2010 to 2013

– Online retail growth will continue to outpace brick & mortar sales

– Total U.S. retail is a ~$4 trillion market, of which eCommerce only represents ~3-4%

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$132 $128 $135$150

$166$183

$0

$50

$100

$150

$200

2008A 2009E 2010E 2011E 2012E 2013E

(in Billions)

U.S. Retail eCommerce Sales

9% CAGR

Majority of SMMs have yet to deploy eCommerce or payment processing

– 70% have an online presence– Fewer than 25% have deployed eCommerce

functionality

Small (ish) merchant growth outpacing overall market

$1.0

$1.2

$0.9

$1.0

$1.1

$1.2

$1.3

2007 2008

(in Billions)

13.2% Growth

Source: Internet Retailer.

Revenue of IR 500’s 100 Smallest Merchants

Page 6: Follow the Customers: Selling on Amazon & eBay & webstores

Online Shoppers Use Multiple Sources for Purchases

89%

86%

78%

77%

66%

65%

61%

61%

59%

49%

Marketplaces/ Store/ retailer Websites

Search Engines

Manufacturer Websites

User ratings and reviews of products

Recommendations (People who bought)

Recommendations (recently viewed)

Recommendation emails

Recommendations (People who viewed)

Recommendations (Best sellers)

Question and answer sites

0% 20% 40% 60% 80% 100%

Page 7: Follow the Customers: Selling on Amazon & eBay & webstores

“The reality is that any merchant selling online will list their items for sale in multiple locations—on Amazon, eBay, their own Websites, etc.”

- November, 2008

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Page 8: Follow the Customers: Selling on Amazon & eBay & webstores

SMMs Relied on eBay 5 Years Ago

Online Store

Merchant

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Page 9: Follow the Customers: Selling on Amazon & eBay & webstores

Google is Changing the Landscape

Merchant

9

Online Store+

Page 10: Follow the Customers: Selling on Amazon & eBay & webstores

Creating Challenges

10

Channel Management

and Opportunities

OnlineStore

CSE’s/ Search

Merchant

Page 11: Follow the Customers: Selling on Amazon & eBay & webstores

Ensure you have Channel Management

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Page 12: Follow the Customers: Selling on Amazon & eBay & webstores

Largest Marketplaces in the World

Page 13: Follow the Customers: Selling on Amazon & eBay & webstores

LowerPrices

Winner Take All?

Buyers

Orders

Merchants

Items

LowerCosts(Scale)

Assortment Attracts Buyers• Selection/ Brand• Natural Search (UGC)• Affiliate

Buyers Generate TransactionsTransactions Attract

More Merchants

Merchants Globally List Items Across Stores &

Marketplaces

Page 14: Follow the Customers: Selling on Amazon & eBay & webstores

eBay vs. Amazon GMV

Page 15: Follow the Customers: Selling on Amazon & eBay & webstores

3rd Party GMV - eBay vs. Amazon

2005 2006 2007 2008 2009 2010 $-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

AmazoneBay

GM

V in

Tho

usan

ds

Page 16: Follow the Customers: Selling on Amazon & eBay & webstores

eBay and Amazon are Huge

Page 17: Follow the Customers: Selling on Amazon & eBay & webstores

Amazon is Executing Very Well

Expanding into new markets– Amazon Payments– Mechanical Turk– eBooks and Kindle – growing– Cloud computing– Fulfillment by Amazon (FBA)

Growing FBA but still competing with their sellers

Aggressively growing 3rd party merchant base – 30% items sold by 3rd party merchants– 2MM merchants

Page 18: Follow the Customers: Selling on Amazon & eBay & webstores

The Only Constant is Change

Lowering insertion fees as they are traded for final value fees

Many promotions can bring down costs for merchants (i.e, free listings)

Complex pricing… changes favor ‘store’ subscriptions with no store benefits

Facing extreme item dilution with millions of new items flowing into the ‘core’

Focused on streamlining the buyer experience and increasing cataloging

Merchants can still sell successfully but need a strategy…

Page 20: Follow the Customers: Selling on Amazon & eBay & webstores

Analyzing the Other Marketplaces

Page 21: Follow the Customers: Selling on Amazon & eBay & webstores

Analyzing the Other Marketplaces

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eBay and Amazon are Huge

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Should You Care About Mobile?

eBay is projecting $1.5 billion in mobile GMV in 2010

Amazon completed $1 billion in sales in the past year

Page 24: Follow the Customers: Selling on Amazon & eBay & webstores

Other Commerce Opportunities?

Private Online SalesOnline/ Offline Commerce

Page 25: Follow the Customers: Selling on Amazon & eBay & webstores

Riding the Facebook Rocketship

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The Third Leg of the Stool – Your Own Storefront

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Ewwwww, ahhhhhh, How Pretty…

Beauty Is more than skin deep

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Vendio Platform—Channel Mgmt

Simultaneous item publishing– Single inventory item created and marketed across all channels– Channel specific requirements simplified with “profiles”– Inventory quantities kept in sync across channels as items sell

• User defines “stock out” risk to determine reserved quantities• Includes refund management and inventory audit tracing

Unified order and customer management– Each channel has a unique and complex management system– Merchants see a comprehensive view of all customer activity– Customization lets each user tailor the experience to their needs– Extensible through web services integration

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Page 29: Follow the Customers: Selling on Amazon & eBay & webstores

Other Store Considerations

Storage and BandwidthSKU’sSearch Engine Optimization (SEO)Security/ PCI ComplianceItem & Order ManagementThird Party IntegrationCSE FeedsCustomer SupportDesigns/ TemplatesPrice

Page 31: Follow the Customers: Selling on Amazon & eBay & webstores

Setup fee Monthly Fee

Transaction Fee Checkout Storage Bandwidth SKUs

$ - $ - 0% PP, GOOG, A.net Unlimited Unlimited Unlimited

$ - $ 9.95 0.5% - 5% PP, GOOG, A.net Not published Not published 50,000

$ - $ 59.95 7% AMZN Unlimited Unlimited Unlimited

$ - $ 29.95 0.5% PP, Check, Money Order 5 GB 50 GB 5,000

? ? ? ? ? ? ?

$ 50.00 $ 39.95 1.5% PP Unlimited Unlimited 50,000

$ 49.95 $ 49.95 0% PP, A.net 1 GB 10 GB 300

$ 49.00 $ 59.95 0% PP, GOOG, AMZN Not published 10 GB Unlimited

$ - $ 99.00 1% PP, GOOG, A.net 1 GB Unlimited 10,000

$ 49.00 $ 99.99 0% PP, GOOG, Checks Not published 15 GB 5,000

A Further Slice of Providers

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Signup and Setup Should be Easy

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Domains Should Integrate Easily

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Simple Setup for Categories

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Manage one set of inventory from one dashboard, across your Vendio store and if you choose – other

channels such as eBay, Amazon, Google (CSE).

Manage one set of inventory from one dashboard, across your Vendio store and if you choose – other

channels such as eBay, Amazon, Google (CSE).

Add Items to the Store

Vendio Stores feature full Inventory Management. Easily add and remove items for sale including

post-sale functionality such as automating coupons to your past bidders.

Vendio Stores feature full Inventory Management. Easily add and remove items for sale including

post-sale functionality such as automating coupons to your past bidders.

Page 37: Follow the Customers: Selling on Amazon & eBay & webstores
Page 38: Follow the Customers: Selling on Amazon & eBay & webstores

Comparison Shopping Engine 101

CSE’s/ Deal Sites/ Coupon Sites

Google

Shopping.com, Pricegrabber, Shopzilla/ Bizrate, Smarter, Become

Dealio, Thisnext, Kaboodle, Couponcabin, Retailmenot, Fatwallet, ebates, Shopstyle, Shopwiki, Dealnews, Ciao

Page 39: Follow the Customers: Selling on Amazon & eBay & webstores

CSE’s are in Tough Spot

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SEO 101 – How do you SEO?

Pick target keywordsOptimize page– Title– Content– URL– Description/ Images/ Meta Tags– H1’s

Secure BacklinksFree Tools – Seobook.com / Seomoz.org – Keyworddiscovery.com – Google Insight

Avoid “Black Hat” tactics (i.e, keyword stuffing, buying links and copying content)

SEO is a ‘black box’ that is purposefully hard to understand.

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SEM Work 101

SEM is complex too however it is more transparent

– Q-score (Landing page, CTR, ad copy, bounce rate)– Bid amount– Keywords and keyword groups– Content networks vs. search network placement

SEM can be as little as $0.05 CPC & go up above $200 CPCTrack, track, and track some moreSet low spending caps so you don’t lose your shirtGet Free bonuses for getting started

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Questions?

Michael [email protected]

Twitter: levitmc