Sales triple every year, sellers break through Amazon's low profit pain point!

How can you get out of the low-profit trap on Amazon and build your own brand? How should sellers deal with the industry's internal competition?

Yien.com interviewed Wang Quan, the operations director of Zhengzhou Yilianke E-commerce Co., Ltd. (hereinafter referred to as "Yilianke"). He has worked in the cross-border e-commerce industry for many years and has rich experience and unique insights into Amazon's operations and branding. Wang Quan gave some suggestions on the problems sellers encounter in Amazon operations.

Successfully transformed into Amazon, with sales tripling every year

Founded in 2014, Yilianke is a cross-border e-commerce company that mainly sells beauty and nail products, and its products are mainly sold to the European and American markets. Yilianke is an enterprise incubated by Henan Post Industrial Park. During its establishment and development, it has received strong support from Henan Post. Since entering the Amazon platform in 2018, it has achieved a sales growth rate of 3 times per year.

According to Wang Quan, the platform that Yilianke initially operated was not Amazon, but Wish and AliExpress.

Talking about the reason for changing platforms, Wang Quan said that in addition to the long account period and unstable platform rules of the original platform, more importantly, Yilianke hopes to change the previous "distribution" business model and find platforms and channels that can bring higher profits to the company to support business development. "At that time, these businesses were doing very well, and it took a lot of determination to cut them off," said Wang Quan.

The subsequent development of EasyLink proved that the decision made at that time was correct: after entering Amazon in 2018, EasyLink's sales scale and team continued to expand, and its sales volume tripled every year.

Like most sellers, the epidemic has also brought opportunities to Yilianke. According to Yilianke’s research, before the outbreak of the epidemic, the market share ratio of offline and online beauty products was 8:2.

Due to the impact of the epidemic, a large amount of offline traffic has shifted to online, bringing a large increase to online brands. Although as the epidemic prevention policies in Europe and the United States are relaxed, some people will return to offline consumption, but in more than a year, Yilianke has also cultivated a large number of users who are accustomed to online consumption.

Wang Quan was very calm about the "big earthquake" that happened on the Amazon platform this year : "This has no impact on our company because we always adhere to the 'three no's': no ​​inferior products, no small cards, and no fake orders."

Although it also has its own independent website, Yilianke has a different positioning for its independent website. For Yilianke, the independent website is not only a sales channel, but also a platform to extend user experience, display new brand products, and accumulate users. Therefore, at present, Yilianke does not have business indicators regarding sales for the independent website, and the advertising around the independent website is also aimed at increasing users.

How to get rid of internal competition and get out of the dilemma of low profits

Regarding the problems of involution and low profits currently encountered by cross-border e-commerce sellers, Wang Quan believes that for Amazon sellers, track selection is very important, and platform factors and personal factors should be considered comprehensively. For example, although 3C products are hot, it also means that the track is too crowded, and a large number of sellers are participating in the competition. The low profits and involution that everyone complains about are often caused by the overcrowded track.

Take the beauty and cosmetics track chosen by Yilianke as an example: beauty and cosmetics products naturally have a certain threshold. At the same time, beauty and cosmetics products are products with high unit prices and high repurchase rates. Even in the face of a sharp increase in shipping costs this year, they can still guarantee a certain profit margin.

In terms of product layout, Yilianke also has unique considerations: " We do not layout according to product categories, but accurately locate our existing users and expand and develop products in a targeted manner based on the needs of existing customers. " Doing so can greatly reduce the risks and costs of product expansion.

Wang Quan mentioned that sellers should improve their profit margins and brand their products while selling them. Only through branding can the repurchase rate be increased, marketing costs be reduced, products can have a premium, and price wars can be avoided. The key behind this is to provide a good user experience.

Wang Quan still uses his own company as an example: Yilianke will make a lot of demonstration videos, pictures, operation and return service instructions on the product. Provide customized customer service to solve the main problems of customers. In addition, independent websites are also an important channel to extend user experience. With improved user experience, the repurchase rate has also increased, and users are more willing to pay for the brand premium.

In addition, Wang Quan believes that there are several key words to operate well on Amazon: product, organization, supply chain, and finance. Is your product Amazon-friendly? How long is its life cycle? Does your team have good organizational skills? Can you continuously optimize key links in management and operations? What is the capacity of the supply chain? Is the financial cash flow healthy? "If you think about these issues clearly, I think you can get on the Amazon track at any time." Wang Quan said.

Working in the cross-border industry, Wang Quan remains optimistic about the future of the industry, but he believes that the road ahead is also full of challenges.

Cross-border e-commerce: both danger and opportunity

Regarding the future development of cross-border e-commerce, Wang Quan believes that opportunities and challenges coexist. Cross-border e-commerce exports are an important national strategy and will be further developed in the future. But at the same time, more excellent domestic e-commerce brands and suppliers will enter the cross-border e-commerce industry, and more domestic brands will go overseas. In the future, cross-border e-commerce competition will intensify further. At the same time, the recurrence of the epidemic is also an unstable factor that sellers need to pay attention to.

During the interview, Wang Quan also revealed to us the future development plan of Yilianke:

1. Expand the market from Europe and the United States to more secondary markets, such as Australia, Canada, the Middle East, etc.;

2. Open new sales channels and expand the sales of the independent site when the independent site has accumulated a sufficient user base;

3. Expand sales categories and create a multi-category brand with beauty products as the core and user needs as the basis;

4. Expand the number of brands. Wang Quan mentioned that currently they only have 1-2 brands in a single category of products, and in the future they may expand to 8-10 brands in a single category.

As a cross-border seller, do you want to learn more about Easylink's operating experience? On December 13, at the 2021 First China (Zhengzhou) Central Cross-border E-commerce Seller Brand Overseas Summit, Easylink's Operation Director Wang Quan will share his experience in operating the Amazon platform under the big data opportunity based on his many years of experience, and bring more exclusive information to the participants on site. Click the QR code below or read the original text to sign up!

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