The migration of companies into the digital space has led investors and aggregators to focus on marketplaces like Amazon. Not until 2021 Amazon aggregators stole €5,000 million in Europe and the United States by private equity companies.
The goal of aggregators is to acquire third-party brands with great potential and viability to increase exposure, which a great opportunity for brands.
Although each aggregator has its own parameters, Many brands are not interesting for them. For this reason, the aggregator BrandHero has compiled a list of 9 positive points that can help make a brand attractive and suitable.
1. Trademarks. There are many reasons to prefer a brand that owns intellectual property. First, You are better protected from copycats trying to sell the same product. On the other hand, These types of brands tend to have a more mature and experienced ownership structure, which is a huge benefit.
2. Brand positioning. It is particularly important the person who built the brand in the user communities where it offers products and also how they benefit from it the relationships you have built with your customers to solidify your brand image use their contributions in every interaction in the product line. In addition to high ratings or status within the product on the general page.
3. Profit Margin. The higher the better! Ideally, Companies have a net margin of at least 20-25%. This isn’t a hard constraint as there are many niches that inherently have lower marginseither because of the higher intrinsic cost of bringing this type of product to market, or because it is a highly competitive product that leaves each vendor with little pricing power.
4. Great presence on Amazon. The presence within the platform is vital and Values closer to 100% exposure are a positive indication. If a brand is successful selling on Amazon and bearing all the associated costs, it is likely to be successful on its own D2C platform as well. However, the opposite cannot be concluded as there are many brands that are only sold outside of Amazon and do not translate positively when inserted there.
5. Large number of reviews. Positive feedback from buyers is crucial. the ratings They are a very relevant point to consider and both quality and quantity are important.. In many cases, a significant portion of reviews appear to come from unverified buyers or other parties who are less reliable from a feedback standpoint, which may indicate manipulation. It is important to adjust the actual number of reviews based on how long the products have been on the market, what category they belong to, and what country they are sold in to draw conclusions.
6. Profitability. The lines between gross margin and net margin are the ones that can truly be successful. Products with a relatively low cost of goods are more interesting because by far the biggest expense when selling through the Fulfillment by Amazon (FBA) program is the fees involved.
7. Product Marketability. The most interesting brands are those that focus on audiences that belong to specific niches or sub-niches. In addition, the image, content, product offering and spirit of the brand must be aligned with the behavior and beliefs of this long-term audience.
8. Business Strength. From a financial perspective, brands that can sustain consistent growth year-round and a low seasonality factor are very attractive. The ability to be resilient and pivot to more or different products sub niches in the same industry is also a factor of paramount importance.
9. FBA mode. Fulfillment By Amazon is the system that Amazon makes available to its sellers in order to offer them various services such as acceptance, storage, shipping or returns. This article is not essential since it is very common among all sellers, but The improvement and efficiency at the logistic level is significant.