How to break out of the low profit trap and build your own brand on Amazon? How should sellers respond to industry insiders?
Yi'en.com interviewed Zhengzhou Yilianke E-commerce Co., Ltd. (hereinafter referred to as "Yi'en.com")Wang Quan, the Operations Director of Yilianke. He has been working in the cross-border e-commerce industry for many years and has rich experience and unique insights into Amazon's operations and branding construction. Wang Quan gave some suggestions to sellers regarding the problems they encountered in Amazon operations.
Successfully transitioned to Amazon, with sales doubling annually3x
Established inIn 2014, Yilianke was a cross-border e-commerce company specializing in beauty and nail products, mainly targeting the European and American markets. Yilianke is an enterprise incubated by Henan Post Industrial Park, and has received strong support from Henan Post during its establishment and development. Since entering the Amazon platform in 2018, it has achieved an annual growth rate of tripling sales.
According to Wang Quan, the initial platform operated by Yilianke was not Amazon, but ratherWish and AliExpress.
When it comes to the reasons for changing the platform, Wang Quan stated that in addition to the long account period and unstable platform rules of the original operating platform, more importantly, Yilianke hopes to transform the pastThe business model of "distribution" aims to find platforms and channels that can bring higher profits to the company and support business development. At that time, our businesses were doing very well, and we made a great decision to cut them down, "Wang Quan said.
The development situation after Yilianke has proven that the decision made at that time was correct:stayAfter joining Amazon in 2018, Yilianke's sales scale and team continued to expand, achieving an annual triple growth in sales.
Like most sellers, the epidemic has also brought opportunities to Yilianke. According to research by Yilianke, before the outbreak of the epidemic, the market share ratio of beauty products offline to online was8: 2.
Due to the impact of the epidemic, a large amount of offline traffic has been transferred to the online market, bringing significant growth to online brands. Although with the relaxation of epidemic prevention policies in Europe and America, some people will return to offline consumption, in over a year, Yilianke has also cultivated a large number of users who are accustomed to online consumption.
For what happened on the Amazon platform this yearWang Quan's response to the "Great Earthquake" was calm: "This has no impact on our company because we always adhere to the 'three no's': not providing inferior products, not letting small cards go, and not brushing orders
Although it also has its own independent station, Yilianke has a different positioning for its own independent station.For Yilianke, an independent website is not only a sales channel, but also a platform to extend user experience, showcase brand new products, and accumulate users.Therefore, at present, Yilianke does not have any sales indicators for independent websites, and advertising around independent websites is also targeted at user growth.
How to get rid of internal competition and overcome the low profit dilemma
Regarding the problems of internal competition and low profits faced by cross-border e-commerce sellers at present, Wang Quan believes that,For Amazon sellers, track selection is crucial, taking into account both platform and personal factors.asAlthough 3C products are popular, it also means that the track is too crowded, with a large number of sellers participating in competition. Everyone roast about the low profit, and the inner roll is often caused by the overcrowding of the track.
Taking the beauty track chosen by Yilianke as an example: beauty products naturally have a certain threshold, and at the same time, beauty products are products with high customer price and high repurchase rate. In the face of the sharp increase in shipping costs this year, they can still ensure a certain profit margin.
In terms of product layout, Yilianke also has unique considerations:“We do not lay out our products based on product categories, but rather accurately position our existing users and conduct product extension and targeted development based on the needs of existing customers.”This can greatly reduce the risk and cost of product expansion.
Wang Quan mentioned that in order to increase profit margins, sellers should also promote branding while selling their products.Only through branding can we increase the repurchase rate, reduce marketing costs, and provide a premium for products to break free from price wars.The key behind this is to ensure a good user experience.
Wang Quan still takes his own company as an example: Yilianke will make many display videos, pictures, operations, and return service instructions on the products. Provide customized customer service to address major customer issues. In addition, independent websites are also an important channel for extending user experience. The user experience has improved, the repurchase rate has also increased, and users are more willing to pay for the brand's premium.
In addition, Wang Quan believes that in order to operate Amazon well, there are several key words: product, organizational level, supply chain, and finance.Is your product Amazon friendly? How long is the lifecycle? Does your team have good organizational skills? Can key links in management and operation be continuously optimized? What is the capability of the supply chain? Is financial cash flow healthy?Considering these issues clearly, I think we can enter the Amazon track at any time, "Wang Quan said.
Being in the cross-border industry, Wang Quan continues to have a positive outlook on the future of the industry, but he believes that there are also challenges on the way forward.
Cross border e-commerce:Coexistence of "danger" and "opportunity"
Wang Quan believes that opportunities and challenges coexist for the future development of cross-border e-commerce. Cross border e-commerce exports are an important national strategy and will be further developed in the future. But at the same time, more excellent domestic e-commerce brands and suppliers will enter the cross-border e-commerce industry, and more domestic brands will also go overseas. In the future, cross-border e-commerce competition will further intensify. Meanwhile, the recurrence of the epidemic is also an unstable factor that requires sellers to pay attention to.
In the interview, Wang Quan also revealed to us the next development plan of Yilianke:
1Spread the market from Europe and America to more secondary markets, such as Australia, Canada, the Middle East, and other regions;
2Open new sales channels and expand the sales revenue of independent stations when they accumulate a sufficient user base;
3Expand sales categories and create a multi category brand centered on beauty and based on user needs;
4. Expanding the number of brands, Wang Quan mentioned that currently they only have 1-2 brands in a single category of products, and may expand to 8-10 brands in a single category in the future.
As a cross-border seller, would you like to explore more operational experience of Yilianke?On December 13, 2021, at the first China (Zhengzhou) Central Cross border E-commerce Seller Brand Overseas Summit, Wang Quan, the Director of Operations at Yilianke, will share the operation of the Amazon platform under the opportunity of big data based on years of experience, bringing more exclusive dry goods to attendees on-site. Quickly click on the QR code below or read the original text to register!