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Amazon burning question: inhouse or agency?

Seller, Vendor or hybrid - Amazon is like Marmite, you either love it or hate it! Those that love Amazon and understand how to service the beast have an ‘Amazon Mindset’. They understand that taking an Amazon-first approach when creating an eCommerce strategy will result in saving time and money - and more importantly, an increase in sales.

Those that have an Amazon Mindset recognise the importance of having a multi-skilled internal or external team to manage Amazon. They also understand that investing in the correct software will be worth its weight in gold. ​Furthermore, there is an intrinsic acceptance that not being in control of stock levels can damage your earlier investments and penalties may apply. Those that hate Amazon allude to pricing challenges, calling Amazon out for driving their retail pricing low – but is it just Amazon’s pricing policy that makes it the most visible culprit?

​It’s clear to me that the leaders who understand the fundamentals of managing Amazon and create sales, marketing and operating strategies to support the platform have that Amazon Mindset. Amazon should not be your only retail partner: you should definitely not put all your eggs in the ‘Amazon basket’. However, don’t underestimate the power of this huge sales account, serving as an enormous marketing platform where over 60% of product searches commence ahead of Google. ​

Amazon account manager jobs are often advertised as National Account Manager (NAM), but with all due respect, NAMs for Amazon simply do not exist. NAM skills for managing bricks and mortar customers aren’t transferable; the Account Manager needs to skilfully manage and apply an algorithm, as Vendor Managers are not buyers selecting your range.

​There are so many cross-functional skills required to manage Amazon and the idea that one individual is skilled at managing everything related to Amazon is a myth. They will need support through analytics, marketing, content creation, sales and operations/logistics.

If budget allows the hire of an internal team, this will deliver significant results. Building your own team means they will garner specialist knowledge on how to manage Amazon. Whether that is through understanding your internal forecasting systems or learning to understand your seasonal products, an internal team will create a wealth of knowledge that can be applied to the day-to-day running of your Amazon business. ​

Many companies believe that agency costs are higher than hiring a dedicated person to manage Amazon. As someone that runs an agency, I’m sceptical that a single individual can be equally adept at running highly efficient PPC campaigns, writing Amazon-optimised copy for product listings, staying on top of programme-and-policy developments and overseeing inventory forecasts. That same person is often expected to be highly skilled in strategic growth-focused areas, manage customer service, resolve cases, respond to product reviews and scan products for unauthorised sellers and counterfeiters. ​

Once you have evaluated the skills and competencies needed in your Amazon team, it will become apparent that 2-3 people can cover these functions. If your business is new to Amazon, can you justify this cost without knowing what potential sales Amazon could deliver?​

Also, who will be managing these people, who will have to link up with different departments, as Amazon touches every part of your organisation. ​ Consider too costs such as healthcare benefits and the expense of hiring.

Besides the costs of hiring, salaries and managing the team, there will be staff turnover. ​ A small internal team of Amazon experts exposes companies to significant ‘key person risk’ - with four weeks’ notice, they may struggle to maintain momentum on Amazon while the position is filled. ​An agency, meanwhile, will have a pipeline of qualified candidates to take the reins when any position becomes vacant.

​In today’s climate, Amazon skills are in high demand. With the channel growing rapidly, the market is under-skilled, and salaries have increased accordingly, rising by an incredible 30%-50% from pre-Covid to today. Candidates need to be snapped up quickly, as counter-offers are common.

​As Amazon continues to grow the number of Sellers and Vendors on its platform, it is also trying to automate as much as possible. Brands which previously had a person at Amazon to help have found them replaced by a chatbot or product video. Amazon has introduced new direct support models such as Amazon Vendor Services, which is a paid programme. As Amazon moves to a handsoff approach, your internal team will have limited or no interaction with a human. This makes managing this marketplace on a day-to-day basis challenging. ​

​A major benefit of working with an agency is that it will often have a direct relationship with different Amazon teams. Individual companies selling on Amazon are unlikely to get this direct line into Amazon (without paying for it separately). ​

Because Amazon constantly changes its policies, staying on top of new programmes can be tough. There are different policies in different marketplaces and the internal team needs to stay abreast of changes on a global basis. ​There may also be a period of trial and error, as the team ascertains the correct tactic for the business, while an agency with multiple clients can share the knowledge of quick wins. My team shares new discoveries on an ongoing basis.

Hiring an agency simply saves time compared to in-house hiring (3-6 months) and training, while an Amazon agency is fully trained and set up to start work on your account straight away. We have clients coming to us with ongoing Amazon problems which they haven’t been able to be resolve for months, and as we have a team of experts that are troubleshooting daily, we can resolve these issues instantly.

It’s rare for an agency to encounter a problem they have never seen before because of the experience of working with various clients. Any problem you are dealing with has probably already been faced and solved. A good team can even forecast Amazon’s next move and prepare your Amazon store accordingly. With crosscategory experiences, they will know how to best plan for your business and will have tested new programmes on previous clients.

An agency can help upskill your existing inhouse team to understand best practices, as well as assess the correct strategy for growth. A fresh pair of external eyes can supply valuable advice that may be easier for senior management to digest than getting the same information from internal resources.​

It’s not always a question of either-or; an Amazon agency shouldn’t necessarily be used to replace your existing eCommerce team. Rather, an agency can complement and support your team with specific Amazon marketplace knowledge and expertise. In our experience, the best agencyclient relationships are when clients see an Amazon agency as an extension of their in-house team, working in parallel to achieve their goals.​ Since launching in 2019, Etopia has offered consultancy support to existing Amazon teams and also provided end-to-end Amazon Account Management for those that don’t have the internal resources. If you are in a transition period or trying to find the right skilled person or team, we can assist with the recruitment process, while running your day-to-day Amazon business. Alternatively, we love to engage with any brand to assess how we can get the best out of Amazon together.

Asha Bhalsod Asha has 10 years eCommerce account management experience, including at Amazon and managing the Amazon/eCommerce businesses at Tomy UK and Melissa & Doug. She now runs Etopia Consultancy, to help brands create their eCommerce strategy and grow their Amazon business, and can be contacted on asha@etopiaconsultancy.co.uk for guidance with trading on Amazon.