eCommerce businesses often find that expanding from a webstore presence onto Amazon is a great way to grow. It gets your product in front of a bigger market, allowing to take advantage of the world’s biggest eCommerce marketplace.
But, expanding from your webstore to Amazon isn’t always as straightforward as you think it might be. We see this with many of our customers, so in this post I’ll share how you can approach this integration.
What to Consider
When deciding on the best approach for integrating your webstore with Amazon, consider the following:
- How much budget do you have to work with now and in the future?
- What are your expectations for growth? Is this a hobby or lifestyle business or something you want to really grow?
- How quickly do you need a solution in place (weigh the opportunity costs of a “now” solution against a more feature-rich “soon” solution).
- What other expansion might you consider? Is Amazon the only place you want to go or will you want to expand to eBay or Rakuten?
- Do you have or are you considering opening a brick-and-mortar store? How does that fit into the plan?
For a growing business, simply turning on an Amazon integration may not be smartest way to think about. Be sure you consider all of these questions carefully.
Integrating Your Webstore With Amazon
There are two approaches you can take to integrating your webstore presence with Amazon: a point-to-point solution and a multichannel solution. Each has its own advantages and disadvantages, which I’ll discuss throughout this post.
A point-to-point solution means that the eCommerce platform hosting your webstore talks directly to Amazon. This is typically accomplished using eCommerce platform extensions that are built to talk to a marketplace like Amazon
Pros of a Point-to-Point Solution
Using a point-to-point solution to integrate your eCommerce platform with Amazon has some advantages:
Point-to-point solutions are inexpensive in the short term. Often they require a one-time set-up fee and maybe the purchase of an eCommerce platform extension.
They are quick to set up. Point-to-point solutions don’t tend to be that complex, feature-wise, so set-up usually isn’t a big deal.
Point-to-point solutions are also the simpler approach, in terms of architecture. It’s not hard to wrap your head around “x system pulls y data from z system.” For less tech-savvy retailers, this may be appealing.
Cons of a Point-to-Point Solution
On the flip side, the point-to-point solution has drawbacks:
With a point-to-point solution, you are limited to the functionality of available eCommerce extensions. If the extension marketplace doesn’t have what you need, you build it yourself or you wait for someone else to.
A point-to-point solution also means you have to manage Amazon data in your eCommerce platform. It’s data like categories, product data, and pricing. That means more data and more complexity within that system.
Did you know Amazon limits the amount of calls you can make to their system? A point-to-point solution doesn’t deal with Amazon throttling gracefully. You have to be careful about how often you plan to push data to Amazon and how much.
Picking the Right Point-to-Point Solution
The right point-to-point solution for you depends on the eCommerce platform you use (e.g. M2E Pro for Magento). Each has its own ecosystem of extensions, though some companies will create the same extensions for multiple systems.
Be cautious using extensions. You should only install trusted extensions that have been tested with your specific version of the platform. It also helps to pick extensions that have positive reviews on the extension marketplace. It shows that the community agrees that the extension does what it claims.
A multichannel solution is a separate software solution specifically designed to integrate multiple sales channels in a scalable way. Multichannel solutions act as a third party “in the middle” of the eCommerce platform and the marketplace, instead of requiring the eCommerce platform to talk directly to the marketplace.
In the interest of disclosure, nChannel sells a cloud-based multichannel solution.
Obviously, we’re partial to this approach.
Pros of a Multichannel Solution
Using a multichannel solution has some distinct advantages, over a point-to-point solution:
The multichannel solution, while more expensive up-front, will be more cost effective in the long term. That is, as long as you choose a solution that doesn’t charge you with transaction fees.
A multichannel solution is more scalable. As your business grows, you transaction volume and product catalog will grow. Your technology solutions must be able to handle that growth.
A multichannel solution allows you to maintain clean product data. You don’t have to bloat your eCommerce system with data for Amazon. You can master your product information in one place and publish to each channel as necessary.
Cons of a Multichannel Solution
Even though our company sells a multichannel solution, we know that there are downsides to this approach:
A multichannel solution will be more expensive up-front. A true multichannel solution cannot be an inexpensive one-and-done option, so the cost tends to be a bit higher.
Getting started with a multichannel solution is a little more work. You are changing your business’s engine, so some processes will change. It may cause some growing pains in the beginning.
A multichannel solution introduces a third piece of software into the architecture (in addition to your eCommerce system and Amazon). While it’s the better approach for scalability, it does mean you have another system to work with.
Bonus Pros, Not Related to Amazon
The multichannel solution approach has a couple bonus advantages that aren’t really related to integrating Amazon to your eCommerce system:
Using a multichannel solution positions you to expand to many channels—not just Amazon. It’s a technology agnostic middleman. If you want to expand to eBay or Rakuten or add additional webstores in the future, all you do is plug them into your existing solution.
The right multichannel solution also enables you to integrate with back-end processes and brick-and-mortar stores. As your company grows, your supply chain and fulfillment processes get more complicated. You can simplify them by integrating into a centralized platform.
Picking the Right Multichannel Solution
There are a number of multichannel solutions on the market, many of which use terms other than “multichannel”. Look for these important attributes when assessing them:
- Fee Structure – Do they charge you more as you sell more?
- Other Integrations – Do they afford you the opportunity to expand into other important sales channels?
- Cloud or On-Premise – Is the system hosted in the cloud or do you have to host it yourself on-premise?
Every Business is Different
It’s important for you to understand your business and where you want to take it when considering each solution. Choosing the right or wrong one could make or break it for you.
A point-to-point solution is acceptable for small retailers with a limited expectation of growth. But, a multichannel solution is best for retailers who plan to build a business—who want to win.