When it comes to e-commerce, Amazon presence is a must for retailers and manufacturers. With 8 million U.S. visitors per day, the exposure is unparalleled.
But putting all your eggs in the Amazon basket can be risky. The game rules often change, fees can be steep, and margins can be slim.
The latest twist is Amazon’s push to bring manufacturers into the ‘Our Brands family’ through its Accelerator Program. This rapidly growing program gives manufacturers the opportunity to create products directly for Amazon’s private label and exclusive brands.
The opportunity is somewhat of a conundrum – on the one hand, sellers receive free promotional benefits such as prime placement (products show up high in search results under a separate box titled Top Rated from Our Brands), free access to the influential and highly effective Vine reviewer program, extra support from Amazon marketing staff, and more.
On the other hand, Amazon has exclusive rights and complete control.
So, when we heard about Bosch Tool’s e-commerce approach we were intrigued. In addition to listing on Amazon, Bosch has its own robust B2B e-commerce portal Boschlink, its solution for dealers, plus a portal dedicated to Bluehound, Bosch’s asset management system which is designed to address concerns of the general contractor managing multiple jobsites and warehouses.
Bosch understands and meets its B2B audience’s needs in specific ways that Amazon never will. In a recent interview, Bosch Tool executives detail how the company has made e-commerce a strategic priority and what it plans for a more digitally enhanced business. The interview is well worth reading, but here’s the intriguing part – it appears that Bosch is also participating in Amazon’s Accelerator Program!
According to TJI Research, neither Bosch nor Amazon have made an official announcement about the launch. However, the FYX Ultimate Household Drill and Drive Mixed Set is for sale on Amazon under the FYX brand, which is owned by Bosch, according to US trademark records. It is promoted as Our Brand, with no reference to Bosch.
Given that Bosch has chosen not to publicly associate FYX with the parent company’s brand, it might be an experiment for the company in figuring out how Amazon’s Our Brands world works.
We think Bosch’s three-pronged approach is a smart way to hedge marketing bets for an industrial manufacturer wanting to reach both B2B and B2C customers. Through its own portal, Bosch is catering to its B2B contractor base and nurturing its professional relationships while retaining valuable customer insights. At the same time, Bosch is reaching a much larger audience of B2B and B2C customers and prospects with paid Amazon advertising. There are fees, but Bosch retains control. Lastly, Bosch is experimenting with the Accelerator Program, receiving additional marketing benefits without added fees but not giving away its brand equity.
Bottom line: It will be interesting to see how Bosch allocates e-commerce resources going forward. In the meantime, we’re impressed with their best of both e-commerce worlds approach. For industrial companies considering the Our Brands opportunity, we recommend following the Bosch example:
- List on Amazon, but not exclusively. Find or build a more dedicated portal that understands your specific customer and its purchasing processes.
- If you join Our Brands, proceed cautiously. You may not want your brand name publicized.
- Monitor your paid advertising efforts on Amazon – look out for potential competition from the Our Brands family. As the program grows, there will be more Top Rated from Our Brands products featured in searches and even on your product page. The question will be whether or not to ‘beat them or join them’ – weigh the costs and risks carefully.