It was another big year for Amazon in 2017, which continues to grow its revenue and valuation annually. For sellers, many of the site’s older, outdated features were retired, while new, more interactive ones were introduced, tested and officially launched.
Amazon itself made big moves, expanding into dozens of white-label brands and even influencer marketing. It was a whirlwind 12 months for the retail giant to say the least.
It’s difficult to believe Amazon’s growth won’t continue into 2018. With Prime Memberships rapidly increasing, we don’t really expect Amazon to slow down.
This year, we’re asking leading industry experts which trends they predict will shape the Amazon Marketplace in 2018.
Meet the Experts: The 2018 Amazon Roundtable
This year, we collected predictions from our own experts as well as industry professionals including:
- Pat Petriello, Head of Marketplace Strategy at CPC Strategy
- Bernie Thompson, Founder at Efficient Era
- Jordan Gisch, Marketplace Channel Analyst at CPC Strategy
- Karen Hopkins, Marketplace Channel Analyst at CPC Strategy
- Ashley Vanderveen, Project Manager, Creative Services at CPC Strategy
- Chad Rubin, CEO at Skubana
- Ryan Burgess, Marketplace Channel Analyst at CPC Strategy
- Jeremy Biron, Founder at Forecastly
- Trish Carey, Marketing Director at Seller Engine
- Jordan Berry, Marketplace Channel Analyst at CPC Strategy
20 Amazon Trends Predicted to Shape 2018:
1. Amazon Product Reviews System Update
Since Amazon prohibited incentivized reviews in October of 2016, we haven’t heard much in the way of updates on how Amazon treats reviews, but getting initial reviews is still a massive hurdle for brands introducing new products to the Marketplace.
I think it’s possible we see Amazon reconsider whether they need/allow unverified reviews at all anymore (it made sense when the review system was in its infancy), change the review system to only count a rolling 12 month period, and/or display reviews as “500+” or “1000+” to discourage Sellers from trying to stockpile unnatural reviews.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
2. Introduction of Video Product Reviews
We have seen video become a bigger deal on Amazon over the past year or so as they continue to optimize the search and shopping experience to better enhance the customer’s experience.
Currently, Sellers can get “related video shorts” on detail pages by hosting a video on AWS and tagging it with related content to your product detail page, vendors can add a video as one of the secondary image placements on your detail page (and this is currently open as a beta for some 3P sellers via EBC), and in A++ content which is slowly being rolled out for vendors (for a hefty price) is more interactive and has some video components.
I would not be surprised at all if we start to see Amazon rolling out a “video product review” feature in 2018.
This will enable customers to leave more detailed reviews so that future shoppers can make more informed purchase decisions, reduce the number of product returns, and further separate high-quality products from poor-quality, knockoff items.
– Jordan Gisch, Marketplace Channel Analyst, CPC Strategy
3. Continued Functionality Parity Between 3P Sellers and Vendors
In 2018, Amazon will blur the lines between 1P and 3P, offering more hybridizations and common programs for brands. Control of listings and brand assets will become more unified. There’ll be more ways for Amazon to source goods from FBA at 3P pricing, and sell them 1P elsewhere.
Amazon will take more of the tax complexity burden off 3P sellers. These hybrid models will strengthen Amazon’s offerings and give sellers more cases where they get the “best of both worlds” between 1P and 3P.
– Bernie Thompson (Founder, Efficient Era)
I also expect we’ll continue to see Amazon close the functionality gap which has long existed between 3P Sellers and Vendors.
We’ve seen this already with EBC being introduced as the analog to A+ content and Headline Search Ads being made available through Seller Central.
I expect we’ll continue to see this, with Amazon likely to make Product Display Ads available through Seller Central and even considering opening up programs such as Vine to 3P Sellers.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
4. Increase development of “Amazon Go” and other grocery efforts
Amazon Go is the “no-lines” grocery store where you simply fill your basket and walk out, having your Amazon account charged for the items you took. There is currently only 1 location, in Seattle, and it’s closed to select Amazon employees.
With Amazon’s recent purchase of Whole Foods, I expect they’ll be using these new locations to collect data on retail customer shopping behavior to influence the future development of these “cashier-less” stores, possibly rolling them out in existing Whole Foods locations across the country.
– Ryan Burgess, Marketplace Channel Analyst at CPC Strategy
5. Optimizing Content for Mobile & Video
With the release of Enhanced Brand Content pre-set templates and the ability for custom templates, I see Sellers being able to optimize their Enhanced Content for mobile specifically.
With the new modules roughly based on some A+ Content modules, your content will be able to stack and have a sense of mobile responsiveness. A++ will hopefully continue to become more available to vendors and keep enhancing the overall consumer experience.
Amazon Enhanced Brand Content for mobile.
Enhanced Brand Content Video was rolled out in 2017. Video plays a huge role in Amazon Stores and I think will continue to become something that you include on your product listings just like an image.
The ability to showcase your product in a 360-view and explain specific features may help decrease the risk of returns and empower the consumer to make the purchase decision with the additional information provided.
– Ashley Vanderveen, Project Manager, Creative Services at CPC Strategy
6. Brands / Brick & Mortars Flee to Amazon
Bigger brands are coming to Amazon in 2018 looking to expand into non-branded and branded traffic (which could potentially saturate the market) so it is important to get dialed in and protect your space.
Additionally, brick and mortar stores are expanding into online marketplaces to compete (largely because Amazon is already in 50% of households, thanks to Amazon Prime memberships).
– Karen Hopkins, Marketplace Channel Analyst at CPC Strategy
7. Bigger Brands > More Competition > Higher CPCs
Again, this isn’t novel, but the competition on Amazon will continue to get more fierce, especially with premium brands entering the Marketplace at an increasing rate. Calvin Klein, Levi’s, and Nike are just a few examples of major players which have entered the space with premium brand equity and deep pockets.
As the Amazon advertising space continues to get more competitive, especially with household players, CPCs will increase across all categories and advertisers will have to invest more simply to maintain market share, let alone increase it.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
8. Better Ad Targeting & Reporting
I expect we will see more advanced ad targeting in the new year. Amazon is behind the curve when it comes to ads being able to target specific shoppers – I imagine in 2018 they will follow suite like Facebook and Google and roll out more advanced targeting for Sponsored Product ads.
Automated Risk Analysis Platform (ARAP) was just revamped for Vendors but I think that better reporting will soon be available for third party sellers.
– Jordan Berry, Marketplace Channel Analyst at CPC Strategy
Amazon will continue to follow in the path of AdWords and add more functionality to their advertising suite. I would expect we will see options such as mobile bid differentiation, geotargeting, and dayparting made available to Amazon advertisers in the not too distant future.
From a data standpoint, I could also see Amazon release data on performance by placement for Sponsored Products so advertisers know what the opportunity is for getting from the second placement to the top placement, for example.
All of these features empower advertisers to more accurately target their ads, which in turn creates a more relevant experience for Amazon shoppers and drives more advertising dollars for Amazon.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
I predict Amazon will start to track external traffic with Pixels, providing more visibility so that Amazon merchants spend more to drive to their listings and track where their traffic sources are coming from.
– Chad Rubin (CEO at Skubana)
9. New Amazon Devices
With the popularity of the Echo line of devices, as well as the Amazon Kindle and Kindle Fire tablets, I expect to see Amazon continue innovating in new consumer electronics devices.
Not only do these devices prove to be exceptionally popular amongst consumers, they also loop the customer into Amazon’s ecosystem, as most owners of Amazon devices are Prime members.
Amazon has experimented with creating a flagship smartphone in the past, rather unsuccessfully, but I wouldn’t be surprised to see them try again in 2018 with a much-improved design.
– Ryan Burgess, Marketplace Channel Analyst at CPC Strategy
10. Growth of Voice Search & Home Assistants
I’d say voice search and home assistants will continue to play a big part for Amazon’s development in 2018. Both Alexa and Google Home are available in some models of newer cars (Ford, BMW & Mercedes).
US consumers are quickly purchasing speaker based home assistants, with Amazon dominating the market (70% according to TechCrunch vs 23% for Google home).
The next step will be how quickly Amazon can keep improving Alexa’s interface and AI to meet customers rising demands.
– Trish Carey (Marketing Director at Seller Engine)
11. Increased Seller Penalties
Amazon puts customer experience and satisfaction above all else. The Amazon search algorithm is designed to maximize customer satisfaction. Sellers that take actions to intentionally deceive the algorithm in an effort to boost sales are negating what Amazon is trying to achieve.
In 2018, Amazon will continue to improve the detection of seller actions that are in violation of its Terms of Service.
– Jeremy Biron (Founder at Forecastly)
12. Encouraging Driving Off-Amazon Traffic to Amazon
This exists to an extent with Amazon’s Amazon Media Group (AMG) suite, but I expect we’ll see Amazon continue to look for ways to empower brands and advertisers to send traffic from Google and social platforms (Facebook, Instagram) back to their Amazon detail pages.
I believe the introduction of Amazon Stores is part of this evolution since it provides a mobile-optimized landing page for off-Amazon traffic, but I think we’ll see Amazon make this easier for Sellers/Vendors by providing more rich data to track the performance of that traffic and even a way to quantify attribution for off-Amazon traffic sources.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
13. Expansion of Amazon Private Label Brands
In 2017 Amazon achieved massive growth of its private label brands like Amazon Elements and Amazon Basics. The company is now starting to hit its stride with launching products under these private brands.
They’ve made significant investments in air and sea transportation to make it easier to import these types of products and quickly bring new products to market. We’ll see growth of these private label brands in 2018 that will far surpass the impressive growth we already saw in 2017.
– Jeremy Biron (Founder at Forecastly)
14. Same-day Delivery Expansion
It’s no secret that Amazon wants to get orders to its customers as fast as possible and is working on efforts to make order turnaround as fast as possible. Fast shipping is one of Amazon’s strategic advantages and same-day delivery will expand into many new markets in 2018.
In the fulfillment centers where Amazon will now offer same-day delivery, it’ll improve its local delivery fleet and increase the breadth of products regularly stocked.
– Jeremy Biron (Founder at Forecastly)
15. Amazon Owning the “Last Mile” of Logistics
While UPS and FedEx have long been integral partners in Amazon’s fulfillment chain, I expect we’ll see Amazon increasingly compete against those carriers by way of rolling out their own fleet of vehicles and owning the last mile of the customer experience.
Amazon operated delivery trucks (drones?) wouldn’t have to share space with deliveries from other sites the way a UPS truck does, and they could use data to optimize routes and make delivery times even shorter. The better the delivery experience, the more satisfied the customer, the more loyal they stay to the Marketplace.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
16. Increased Focus on Amazon Prime Music
The most popular music streaming services today are Spotify and Apple Music. It’s been predicted by many analysts that neither company is profitable by charging the monthly subscription fee alone.
Amazon has shown it can be a real player in the Video Streaming industry, competing directly with Netflix/Hulu all at no additional cost to Prime Members. I wouldn’t be surprised to see Amazon release updates/dedicate a push towards promoting Amazon Prime Music to directly compete with rivals Spotify and Apple Music in 2018.
– Ryan Burgess, Marketplace Channel Analyst at CPC Strategy
17. More A++ Content
We’ve only seen A++ (we’re not sure if this is the official Amazon name for them yet) detail pages for lead brands such as Dove, Degree, and Samsung, but I expect this is a glimpse into the future of the Amazon detail page experience.
Amazon is a conversion engine optimizing towards turning traffic into orders, and A++ allows brands more options to highlight the unique value proposition of their products and recreate the in-store shopping experience on a two-dimensional screen.
– Pat Petriello, Head of Marketplace Strategy at CPC Strategy
Amazon’s A++ Content
18. Amazon Purchasing Control
Amazon will remove the ability for customers to choose who they buy from.
Amazon will algorithmically place who wins the buy box and consumers will lose the ability to choose. In the end, this gives the best experience to the consumer but will hurt resellers competing for visibility and the coveted buy box. The buy box will become the black box.
– Chad Rubin (CEO at Skubana)
19. More “Online Shopping” Holidays
I expect to see that Holidays are turning into opportunities for businesses to capitalize on coupons and run deals on Amazon that are typically not considered “online shopping” days.
– Karen Hopkins, Marketplace Channel Analyst at CPC Strategy
20. Market Consolidation
As the Marketplace continues to mature, it continues to require professional business acumen and a channel dedicated strategy to be successful. Long gone are the days of throwing up a product data feed and hoping for success.
Amazon is a ruthless marketplace, and Sellers/Vendors without a competitive value proposition, quality products, a dialed in strategy, and effective implementation across advertising, content, inventory, service, and branding will not be able to survive.
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