E-Commerce Branding in the Time of Amazon

I recently made two major additions to my life — a second dog and a lake house. On weekends, I need to transport all my stuff and my two dogs to the lake, so I decided to upgrade my SUV to a larger model with an additional row of seats and more cargo space. When I began looking around at available models, I was stunned.

The amount of competition in the SUV marketplace is astounding. There are no fewer than a dozen manufacturers and more than 30 models to choose from. When you add trim packages, custom options, and paint color, there are literally thousands of different possibilities. How am I supposed to make a decision?

The number of choices is paralyzing. From a branding perspective, what struck me is the sheer volume of competition. This is true not just in automobiles, of course. Take a look around your local grocery store and pay attention to the volume of different choices and the intense competition among companies. Every nook and cranny is stuffed with product.

Nowhere is this more obvious than on Amazon. Go to Amazon.com and type in “iPhone cover.” You’ll see a list of 30 items per page and 400 pages! Amazon sells some of the phone covers directly, but there are also dozens of independent companies selling on the Amazon website.

Seismic Shift

Amazon has caused a seismic shift in retailing and in branding. Not that long ago, when I needed a new outfit, a new computer, or a television, I would hop in my car and drive to the local shopping mall. Today, the vast majority of people first go to the Internet to begin shopping. If they find what they want, they buy it online, without ever stepping foot in a physical store. Often, the very first stop is Amazon.

Amazon has become a vast marketplace for thousands — if not millions — of sellers to market their wares to online buyers. Amazon is still like the wild, wild west. It makes all the rules, and your retail or product brand stands to suffer. To shoppers, Amazon is the brand.

Whether it’s a product sold directly by Amazon, through the fulfilled by Amazon process, or by an independent company, Amazon sets the rules. Sometimes, it even sets the pricing, telling sellers the exact price they must charge for their product. This can turn certain categories into a commodity, because the availability of similar products has been increased. When that happens, smaller resellers have to bow to pricing pressure.

With Amazon’s purchase of Whole Foods, it now has physical store locations that offer the benefits that only in-person shopping can provide. With every shopper, Amazon is gathering data about the consumer products people buy. That data can drive Amazon to manipulate its own pricing on its Amazon Basics and Whole Foods 365 brand products to the extent that competing consumer brands will have to change their pricing models. Amazon is not the 800-pound gorilla of retail; it’s the 8,000-pound gorilla.

The impact of Amazon is far reaching. It means brands that want to reach customers independent of Amazon have to build a brand that transcends the selling platform of Amazon.

Toys “R” Us is a brand that basically went out of business because of Amazon. After Toys “R” Us folded, Walmart and Target began to sell more toys online. The toy industry is no longer as fun as it used to be. Toys “R” Us used to serve as a testing or proving ground for new toys and games. Mass retailers like Walmart and Target aren’t in it for risk — they’re going to emphasize selling the products they know will sell in volume.

With Amazon and other online sales channels, the barriers to entry have been removed. Now anyone with a phone can call up a product broker in China, dropship a crate of product to Amazon, and be in business within a month. Even if a product doesn’t exist yet, an entrepreneur can start a KickStarter page based on a diagram, raise money, and start taking orders before a single product rolls off the manufacturing line. This has led to mass competition in just about every space and market.

Along with lowering barriers to entry comes the ease with which companies can be put out of business. There are countless brands that launch with an amazing product that immediately catches on, only to disappear a short time later.

Remember Pokemon Go? For an entire summer, you could see people wandering around, holding their phones at odd angles to play the game. People were obsessed with Pokemon Go. For a few months, that’s all they talked about — but I haven’t heard a word about it since. Some other mobile game or app became all the rage, and Pokemon Go was soon a thing of the past.

Every market for every product is competitive. There is a paralyzing amount of choice in practically every market. Four hundred pages of iPhone covers? That makes it really hard for a brand to stand out among all that noise.

Anyone can build a business by finding potential customers and then converting them on the basis of price, features and availability. In order to build a sustainable, long-lasting brand with repeat customers, however, one key requirement remains true — you have to build a brand by connecting emotionally with your customers.

So, how do you do that?

Emotional Bonding

Many e-commerce companies see branding as writing the perfect copy, choosing the perfect color scheme, and writing up a perfect competitive sales message. The often treat product marketing, pricing and messaging — and A/B testing — as branding. Many never get to a message that bonds so strongly with customers that they’d feel they were cheating on the brand were they to choose a competitor.

Messages and marketing might be the output of branding, but branding is one thing: understanding — and bonding in a deeply emotional way with — your customer. I spend a lot of my time working with e-commerce companies that categorically reject the notion that they need to create deep emotional bonds with their customers. They believe that a competitive price, promotions, unmatched availability, and their product’s special bells and whistles should be enough to sustainably differentiate them and give them a competitive advantage for their entire lifecycle.

That couldn’t be farther from the truth.

If products have advanced features that are not directly imitable by a competitor, the high-level benefits those features provide are. Here’s what I mean. Take a fictitious consumer technology product: Your solution may have a feature that enables customers to do more processing faster, helping them focus on their core jobs. You might even create messages that are centered on the notion of “doing more with less.”

Unfortunately, that’s a baseline requirement — and promise — of technology in general, right? If you market on the basis of something that’s a baseline expectation of an entire category of products, you’re doing it wrong. That would be like marketing ice cream on the basis of being made of milk and being cold and sweet.

If you are pointing your marketing toward a company or a nameless, faceless customer, you’re doing it wrong. E-commerce customers come in many shapes and sizes, not just demographically, but also attitudinally and psychographically. What I mean here is that if you’re a nutrition supplement company with a new, unproven but exciting ingredient, your ideal customer might be someone who is not just willing to take a risk on something new, but who wants to be seen by others as a trailblazer, pioneer or a maven within her or his social circles.

When you know exactly which customers make the best target for your brand, you can start to understand what’s important to them and point not only your brand, but also your messages and marketing, directly at their values, beliefs and desired achievements.

Finally, take a look at your company’s website right now. Go ahead and do it. I’ll wait. Take note of the first words you see on your website’s main headline. If those words are either “we” or your company’s name, you’re doing it wrong. If you’re talking from the point of view of “we do this so you can ” or “we make blah, blah and blah” you’re doing it wrong. The best brands in the world are those that focus on their customers’ life stories and what they, as individuals, are looking to achieve in life.

This is a challenge. There are thousands of ways you can understand your customers, and many companies are paralyzed by doubt over where to start.

From my experience helping companies understand their customers, there are three core questions that really get to the root of how the brand and customer interact. If you can answer these three questions, you’ll be in a much better place to start your branding process.

1. What does your brand say about your customers?

The first question for brands to answer is what it says about a person who uses the brand. What does it communicate both to the outside world and to the customer? This is important because, at its core, this is what a brand is. It’s a statement about the customer, and it’s crucial that, as a business, you know what that statement is.

Answering this question requires you to really get inside your customers’ heads and understand what they want to achieve in their lives, how they measure their success in achieving those goals, what they care most deeply about, and, ultimately, how the brand must deliver.

2. What is the singular thing your brand delivers that customers can’t get anywhere else?

The second question to understand is what the singular thing is that a person using this brand gets from it that isn’t available from any other brand. In other words, what makes your brand singular and indispensable?

What you’ll find, as you dig into this question, is that most of the answers aren’t tangible. It’s unlikely that your product has a feature that no competitors can provide. Instead, what commonly comes up are intangible benefits, like the way the company makes customers feel, or the story it tells them about themselves.

3. How do you make your customer the hero in the story of his or her life?

The third question requires an understanding of how your brand makes the customer a hero in his or her own life story. Everybody wants to be the protagonist. Some brands may achieve that in an obvious way (like a fashion brand making the customer stand out from the crowd), whereas others might be more subtle (like a B2B tech brand making the purchasing manager look good in front of colleagues). No matter what the case, if you can answer this question, you’ll have loyal customers for life.

At a very high level, everything we do in branding is about answering those three questions.

Before you develop any copywriting, design, or other branding outputs, take some time to answer those three questions. If you have trouble getting to the bottom of them, don’t worry. Ask your customers for help, and keep digging until you really understand them. With this newfound understanding of who your customers are and how they want to interact with your brand, you’ll be on the path to defining a powerful brand strategy.