What are the trends for amazon in 2019?And how will we respond?

19-03-13
PART 1
Amazon growth slows
Amazon's retail business has passed the stage of rapid growth, so foreign media reduced the previous forecast of amazon's growth rate.Amazon's sales in retail e-commerce will reach $440.83 billion in 2019, up 19.8 percent from 2019.That suggests growth will slow from 22.4 percent in 2018.
Amazon's proprietary business is a maturing business, growing at a rate similar to that of the entire e-commerce market.At the same time, the influx of third-party sellers will slow, as amazon's proprietary operation already accounts for a large portion of the market.
Even so, the growth rate of amazon is still higher than its peers. Amazon's total sales in the United States will account for 47% of the total sales of e-commerce in the United States in 2019, making it the largest e-commerce platform in the United States.
Amazon's advertising business is booming
While sales growth is slowing, other businesses, some of which are growing rapidly, are primarily in the experience advertising business.According to foreign data research firm Emarketer, amazon's 2019 U.S. advertising revenue is expected to reach $7.23 billion, just behind Google ($47.89 billion) and Facebook ($27.57 billion).
Amazon will account for 5.5 percent of the total north American digital advertising market in 2019 and 7 percent in 2020.Worldwide, amazon's full-year advertising revenue will reach $14.03 billion, up 52.5 percent from 2018.
Amazon's assault on the digital advertising duopoly has been helped by its vast amount of first-party data and the growing tendency of consumers to buy goods on e-commerce platforms.
PART 2
More retailers will increase amazon's advertising budget
A September 2018 survey from Third Door Media found that 34.2 percent of U.S. e-commerce marketers currently spend 10 to 25 percent of their digital AD budget on amazon.Strong intentions going forward: 80 percent of retailers plan to increase amazon's advertising budget in 2019, and nearly a fifth (19.5 percent) plan to increase it by 50 percent or more.
Amazon promotes the sales of brand owners and retailers. Therefore, 61.7% of the advertisements in this survey have amazon product page for product display and brand promotion.Another 35.7 percent plan to have a store page within a year.
Amazon AD changes
In the second half of 2018, Amazon advertising underwent several rounds of revisions. First, the name of Amazon advertising was changed, which means the integration of Amazon advertising business and its goal of developing advertising business.
In the above advertising gameplay background business advertising has also undergone some changes:
1. Automatic advertising becomes four types of four types of matching: close matching/wide matching/similar products/related products;
2. Manual advertising is changed from single keyword placement to commodity placement and brand placement;
3. Added separate bidding for placement;
4. Change of display position on the page: the advertising space on the page has changed from 8 to 12 positions in the upper, middle and lower parts, and the proportion of advertising space is increasing.
PART 3
All this is telling a story: competition is intensifying and traffic costs are rising.So how do we deal with it?
In the past two years, I have been telling you about the strategy of advertising, because advertising is a powerful tool to attract the flow. When the flow cost is relatively not so high, the direct use of advertising to promote will directly lead to the growth of performance.
With the cost of a round of traffic growth and now pure advertising may not be able to meet the changes in the market.In recent months, we have gradually found such a phenomenon that there are more and more brands/stores in vertical operation and the product power of the whole market is further strengthened.
The most direct feeling for us is that the product life cycle is getting shorter and shorter, and the competition from new products is getting larger and larger to some extent.At this stage, what we need to do is not only to consider the low cost drainage, but also to consider the core competitiveness of the product end, and even to position the company at the level of development.
We can divide the market operation activities into the following stages according to the development of the market:
1. "mass production stage"
Enterprises are faced with the problem is the "production" stage of the product, the product upload the efficiency and cost of the problem, namely the early amazon cultured is SKU number and cost problem, also like speed sell tong in the early days of the time open sellers taobao commodity can be an upload, in order to achieve market products supply so as to realize the satisfaction of needs;In this stage, the emphasis is on how to improve the system efficiency of the connection between products and consumers.
2. Product phase
With the increasing number of products in the market, the choice of products will become more skillful. However, as long as there are good products in the market, some people will buy and consume.However, at this stage, we need to consider the changing trend of market demand, market price and the combination of channel and promotion, and pay special attention to the change of product life cycle.
3. User stage
Simply having a product that tells consumers what the product does can no longer keep up with changes in the market.A product is simply an existing means of meeting a customer's enduring needs.Once a better product appears, it will replace the existing one.As a result, selling existing products will be difficult to survive.
Before selling products, we must know what kind of products consumers need and what kind of products can impress consumers.If you don't pay attention to users, only focus on existing products, then any enterprise is doomed to be eliminated, even if your current product is brilliant and successful.
In the past, the market was the end of production. Now, the market is the beginning of production.Like ge's 1957 John mackey terry put forward "marketing concept" philosophy, for the first time explicitly put forward - production and business operation activities of enterprise, should by the former "with products as the starting point, with sales as the means, in order to increase sales to profit as the goal" of the traditional management concept, to "to consumers as the starting point, by means of marketing mix, in order to meet the consumer demand to profit as the goal" of the marketing concept.
This is also what we have been discussing with a senior product manager in the last one or two months, studying the user profile of the product to further create value for users.In the process of market selection, the market should be divided and one of the market segments should be selected for entry, so as to achieve product differentiation and avoid homogenization.
We have been discussing is in fact the brand emotion transfer in the segment of the market, the demand of the people can be divided into two aspects rational demand and perceptual demand, pay attention to the rational level is the function of the product attributes, can meet the needs of users, but another layer of demand from emotion, specific people usually have a particular way of life, from product development and design requires this dimension, so as to determine the user's tone and brand image.But the difficulty lies in the crowd analysis and the user psychology control, as well as the consistent brand transmission.
The age of competition
When the market operation activities enter the stage of users, it shows that the market demand is relatively saturated from another perspective, while the external competition has deteriorated. Survival in this stage may be the most important problem to be solved.Therefore, at this stage, the enterprise's positioning and competitive strategy will be particularly important.
In essence, positioning is a strategy that is not strictly competitive in terms of consumer cognition through category management, while marketing strategy mainly focuses on three points:
1) leading the total cost, even if the product is identical, but the price has an advantage, then I can beat the competitors;
2) differentiation. If products are similar to a large extent, they will create differences by providing personalized or value-added services, so as to make profits.
3) focus on intensive cultivation in a specific segment to achieve cost leadership and understanding of users and achieve differentiation.
Cost leadership is also a kind of differentiation, so we can know the essence of competition is differentiation, and a company has only two strategies: either cost leadership or high value.
It can be concluded that there is a rule in any market operation: produce products, find consumers, guard against and defeat competitors, and the products, consumers and competition interact and promote each other.
Competition in the new era needs to consider not only beating competitors, but creating real value for users.Only by reorganizing the product value chain from the perspective of user value, and then exploring new production structure and user demand, can we turn the red sea of competition into a new blue sea.
(source: wheat field ferryman)