Reasons why more Amazon merchants will start selling on other platforms next year
Surveyed merchants said they would begin selling on Google Shopping, eBay, and Facebook Marketplace, with 50% saying they would do so. In addition, 47% of those surveyed said they would sell on the Walmart Marketplace. Only 31% of respondents who utilize Fulfillment by Amazon now sell their products on marketplaces other than Amazon, according to the 2022 Amazon Seller Survey. Between October and November, Capterra surveyed 306 retail businesses selling Amazon products for at least a year.
It’s a high density season, although it’s not uncommon for businesses to absorb some heightened logistics costs during the holidays, according to Molly Burke, senior analyst at Capterra who covers restaurants and retail. “Amazon is new to this. Burke continued, “I’s evident from the data that it’s making some merchants pause as they look about where to sell in 2023.
According to Burke, even though these merchants might join other online stores like Walmart.com, Google Shopping, or Facebook, they won’t necessarily be able to offer lower prices there if they continue selling on Amazon. She added that they might be able to increase their brand recognition on other platforms, reach new audiences, and make a little amount of cost savings.
Nearly 50 of Masiello’s CPG clients, who collectively generate around $2 million in annual online sales, he claimed, all have plans to broaden their reach outside of Amazon in 2019. He also mentioned that after Amazon increased its cost for the first time this year, one of his clients—a spicy sauce and pasta manufacturer who had been an FBA seller for years—started selling on Walmart.com and other retailers in the first quarter of 2022.
“I recognise customers, but what happens if costs go up? You can only recover it by raising your rates, Masiello continued. But because Amazon forbids vendors from advertising their products for less elsewhere, that is more challenging.
Hensell cited a few reasons why vendors aren’t abandoning Amazon in such large numbers. To begin with, not all marketplaces provide vendors with fulfillment services. “A seller must have a shipping operation that can handle all of their fulfilment, whether it be in-house or via a third-party logistics provider, if they wish to offer their products on Target Plus, Shopify, eBay, or Wayfair,” Hensell said. Furthermore, Amazon still accounts for the vast majority of sales, even for vendors who have begun offering their goods on other marketplaces like Walmart’s. Despite its expansion, she continued, “Walmart online still represents only 10% or less of the sellers’ sales.”