Amazon’s THREE Pillars for Growth

With an increasingly digital world, the eCommerce giant Amazon is a platform that no brand can afford to ignore. It provides various revenue streams, each with its unique opportunities and challenges.

This guide is designed to help brand owners and Amazon sellers navigate these revenue streams – Organic Traffic, Paid Advertising, and Subscribe and Save (SNS) – with a special focus on understanding and leveraging them for the growth of your brand.

Understanding Amazon’s Revenue Streams

Organic Traffic

Leveraging the power of your brand being at the top of shoppers’ minds and effectively using Amazon’s A10 algorithm is critical in this stream. This organic traffic means all the customers who find and purchase your product without you having to pay for ads. However, measuring organic traffic is tricky because Amazon doesn’t provide separate data for organic traffic, mixing it up with the data from other streams.

Often, brands fall into the pitfall of calculating organic metrics by merely deducting Pay Per Click (PPC) orders from total orders or sessions. This approach doesn’t account for orders from subscriptions, thereby inflating Organic performance data and providing inaccurate results. It’s crucial to find a more effective and accurate approach to separate and quantify this data.

Paid Advertising

Paid advertising, or PPC, involves setting up ads for your products to reach a broader audience on the Amazon platform. Revenue generated from shoppers who click on these ads and make purchases constitutes this revenue stream. It offers an immediate way to boost visibility and often helps build organic rank over time.

Subscribe and Save (SNS)

The less-understood but equally significant third pillar is the Subscribe & Save revenue. It allows customers to receive a product periodically (like every month or every two months) with a discount. This setup not only provides customers with convenience but also gives brands a predictable and recurring revenue source.

The Challenge with SNS Data

However, the intricacies of SNS are often overlooked by brands. Amazon owns the relationship with shoppers, which means the data related to Subscribe and Save is often vague and hard to act upon. The eCommerce behemoth does not offer clean, actionable data around subscriptions, leaving brands in the dark regarding this crucial revenue stream.

Addressing the Challenge

Understanding your SNS data can help tailor your business strategy, manage inventory effectively, and estimate recurring revenue more accurately. Though Amazon doesn’t provide this data directly, brands can use other metrics to estimate their SNS performance. Keeping a keen eye on overall sales trends and any increase in consistent, recurring orders can provide insight into your SNS program’s success.

The Final Word

In the complex world of Amazon selling, understanding your various revenue streams is the first step towards building a successful brand. While organic traffic and paid advertising are more straightforward to comprehend and measure, the third pillar, SNS, requires more attention and analysis.

Keep in mind that the path to success on Amazon involves a balanced approach. Grow your organic reach, invest wisely in paid advertising, and do not underestimate the power of the Subscribe and Save program. Armed with a clear understanding and strategic application of these three pillars, your brand can achieve sustainable growth on Amazon’s vast eCommerce landscape.

Remember, knowledge is power – the more informed you are about these revenue streams, the better you’ll be able to leverage them to your brand’s advantage.