In the ever-shifting landscape of Amazon in 2024, sellers encounter challenges and opportunities necessitating a strategic outlook. From harnessing the potential of Amazon Marketing Cloud to embracing the pivotal role of data-driven strategies and nuanced advertising approaches, there are key areas that demand attention and offer avenues for advantage as 2024 unfolds. Join me in exploring these facets.
Amazon Marketing Cloud (AMC): Potential Vs Reality
AMC’s introduction sparked anticipation as a data analysis powerhouse, but its full potential remains elusive for agencies and sellers alike, due to its high learning curve to access and leverage its granular data for advanced applications. Measuring new-to-brand performance, customer journey segments / touchpoints, and more remain out of reach. High-value features like micro audience targeting are currently inaccessible, prompting a need to shift from generic buzzwords to practical applications.
Anticipate Amazon’s efforts to enhance AMC’s user-friendliness over time and integrate it with other data platforms. Stay informed about evolving changes to determine the opportune moment for implementation at your company/agency, as the learning curve remains a hurdle.
Data Analytics: The Heart of Success on Amazon
Data analytics stands at the core of success, yet fragmentation among service providers poses challenges for brands seeking material value through timely insights. Holistic integration of AMC, Ads, Revenue, and operational dynamics unlocks optimization across the entire profit and loss spectrum.
Sophisticated analysis tools are essential for understanding nuanced customer behaviors, market trends, and operational efficiencies however majority of insights platforms in the marketplace live in the stone age as it relates to translating these into tangible daily tactical activations. This goes beyond surface-level metrics; it’s about diving deep into customer reviews, return rates, and buying patterns to inform product development, inventory management, and personalized marketing strategies. Embracing data analytics enables us to make informed decisions, tailor our approach to specific customer segments, and stay ahead of the next best competitor in a data-driven marketplace.
With Amazon expanding complexity by enabling targeting of cluster audiences, the difficulty has reached new heights. Despite most insights platforms lagging in translating data into daily tactical activations, scaling data analytics capabilities is growing ever important to a determinant of Amazon (and omnichannel) success.
2024 Winners will effectively translate vast data points into cohesive and timely strategy activation, delving deep into customer reviews, return rates, and buying patterns. It’s coming down to: Get a handle on your data or “hand” your business to your competition.
Advertising Strategies: Beyond Budgets and ROAS
The Amazon advertising landscape often fixates on budget size, especially with tools like Amazon DSP. However, the effectiveness of large budgets, particularly for display ads, is under scrutiny. While Amazon DSP offers advanced targeting and reach, there’s a growing concern about its reporting of actual incremental ROI.
It’s becoming increasingly clear that throwing large budgets at ads, especially display ads, doesn’t necessarily yield efficient growth. (A well-known fact in the D2C environments.) Instead, a more nuanced approach is needed evaluating overall growth marketing tactics with an omnichannel perspective instead of moving dollars to channels with goal of smoothing ROAS. That is by far the most harmful action. Of course, Media Agencies are all too happy to indulge in a myopic view of channel level ROAS as it is the easiest lever to manipulate and deflect responsibility when performance is lackluster.
Agencies carry a large responsibility taking our businesses to new heights. We recommend tasking them to deliver the best possible analysis of your performance. One place to start is using a set of metrics that go beyond ROAS, including ACOGS or MOAS (Margin on Ad Spend)*, to paint a more realistic picture of where you are winning in the Amazon marketplace.
*Check out VP of Media, Harriet Carson’s “Metric Monday” LinkedIn post on the MOAS metric here.
Final Thoughts: Adapting Dynamically on Amazon in 2024
For experienced Amazon sellers and vendors, navigating the dynamic and unpredictable marketplace requires agility, deep platform understanding, and a continuous learning mindset. Leveraging AMC (understanding current shortcomings), improving data analytics, and getting smarter with advertising strategies, are keys to success in 2024.
Considering reaching out to the iDerive team to tackle any instability issues hindering your 2024 Amazon growth goals? Our SaaS Analytics platform and managed services solutions have been crafted by experienced brand owners and former Amazon employees. Get in touch by booking a meeting (below).