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Follow the Amazon model to your startup site: Trademarks forced to change their business models

For nobody is a secret that Amazon grows as a foam in the field of digital advertising. According to eMarketer, the e-commerce giant will see its advertising business grow by 50 percent in just one year. Its market share will go from 6.8 percent to 8.8 percent this year. In fact, it is expected that during 2020, its participation in the segment will reach 10 percent.

While these figures are far below those registered by other major companies such as Facebook or Google, it seems to be enough for the company led by Jeff Bezos to impose conditions on advertisers. Recent reports indicate that although the e-commerce giant is interested in the advertising business, it does not want to generate revenue with any advertiser; the firm looks for brands that add value.

The benefit of the platform first

As reported by CNBC, Amazon has informed its partners in recent months that it will withdraw advertising for those products that do not generate benefits for the platform and that, on the contrary, represent a greater expense for the marketplace in terms of logistics . This would be the case, for example, of a pair of lenses with a cost of $ 5, whose management storage, packaging and shipping would have a higher cost for the distributor.

In this way, those brands that wish to continue appearing with their advertising in the largest e-commerce platform in the world, must adapt to the policies imposed by Amazon in terms of purchase prices, storage terms and shipping policies. Otherwise, they must change their business model and sell their products on their own.

Improve benefits, the main goal

The intention of the giant founded by Bezos is to improve the benefits for his business, a situation that has been criticized by many specialists who maintain that there is a bias in the advertising business of the platform, which looks after its own interests and that could affect in an important way to the consumer.

The landscape for advertisers is not encouraging

Given this new reality, the landscape for advertisers is not encouraging. The position of the marks before the phenomenon is complex. The electronic commerce is the next sale on which to look and not be in Amazon, before the importance of the signature in the sector, it would mean to be far from the consumer. However, the cost will be high, if we consider that a change in prices, logistics or business model could secondarily benefit Amazon beyond advertising revenues.

Remember that this firm is growing interestingly with its own brand lines that cover different categories, a proposal against which companies that pay for advertising on Amazon should now fight.

Published inStartups

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