Amazon is the go-to market for millions of sellers around the world, and bringing your brand onto Amazon’s trusted platform offers far more products from a wider selection to reach more customers in a quicker time. But there are several ways you can accomplish this. For many brands, the most popular method is selling your products through Amazon Vendor Central, an invite-only e-commerce platform that enables them to offer their wares directly to consumers through Amazon’s platform.
What is Amazon Vendor Central?
Amazon Vendor Central is an online business hub that allows product manufacturers (i.e., vendors) to create listings on Amazon.com. It has been around for a bit longer than its Seller Central brother and allows brands and retailers to sell their products on Amazon’s platform as a first party (1P).
A 1P relationship with Amazon is a direct relationship, where Amazon is the retailer and the brand is the vendor or supplier. Brands interact with Amazon’s vendor management team, which includes people like buyers and merchandisers. This relationship is managed through a portal called Vendor Central. In this arrangement, Amazon is a traditional retailer — buying products, selling them and owning all communication with the buyer to complete the sale.
From a consumer’s perspective on Amazon, items sold directly by Amazon include the text “Ships from and sold by Amazon.com” in the listing.
How Does Amazon Vendor Central Work?
In Vendor Central, vendors can check their purchase orders, provide product data and manage Amazon Advertising campaigns.
Amazon Vendor Central Vs. Amazon Seller Central
If you’re considering selling on Amazon, you’ll need to choose between the two different types of selling accounts: Amazon Seller Central and Amazon Vendor Central. Here’s a basic breakdown of the main differences between the two options.
- Requires invitation from Amazon vendor management.
- Amazon orders your products in bulk and sets the price. They take care of listing, fulfilment and customer service.
- Amazon takes care of optimizing your product pages.
- Your products are automatically eligible for Prime benefits such as two-day shipping.
- You have access to more Amazon advertising options.
- No invitation needed.
- You control your price, listing content, shipping to the customer (unless using a fulfilment provider) and customer interactions.
- You’re responsible for regularly optimizing your product pages.
- You can only offer Prime benefits to customers if you use Seller Fulfilled Prime or Fulfilment by Amazon (FBA).
- You benefit from higher profit margins.
Can I sell via Amazon Vendor Central and Amazon Seller Central?
As an alternative to having solely a first-party or third-party relationship with Amazon, some brands do both. Assuming you’ve secured a first-party invitation and that Amazon chooses not to sell your entire catalogue, it may be possible to sell non-overlapping SKUs as a third party under certain conditions. The hybrid approach gives you increased access to Amazon’s loyal customers. But again, this is subject to Amazon’s approval.
Pricing, Inventory Selection and Merchandising
First-party vendors sell products to Amazon at wholesale. From there, Amazon lists, sells and fulfils each product. As the brand, it’s up to you to set Minimum Advertised Pricing (MAP) guidelines for Amazon to follow. Though Amazon technically sets the price for an item, retailers and brands can still control the price of their products with the proper policies and distribution strategies in place.
As a first-party supplier to Amazon, however, a brand has little to no control over the SKUs that Amazon actually sells. On the other hand, as a third-party seller, a brand maintains complete control over what products are listed, when they’re listed and the pricing strategy.
If you’re a registered brand on Amazon, Amazon A+ Content provides a fantastic opportunity to let you present your brand and your products the way you want.
Free and unlimited for both vendors and sellers, Amazon A+ Content is one of the most effective ways to increase traffic and sales — and to crosspromote your other products — by giving you the ability to display:
- High definition videos
- Enhanced images
- Comparison charts
- Robust FAQs
- And more
Amazon Vine is an invitation-only program that lets vendors pay Amazon to send products to a select group of reviewers, called “Vine Voices”. This helps brands get reviews for their products and get them up on Amazon.
It’s expensive though — roughly $2500-$7500 per ASIN plus the cost of the products themselves.
Warehousing and Fulfilment
In the first-party model, Amazon purchases and takes control of your inventory. Thus, Amazon is responsible for warehousing products and shipping orders to customers.
For inventory shipped to Amazon fulfilment centres, Amazon provides detailed instructions on packing, labeling, required documentation and transport. Adhering to these details is essential to ensure items aren’t returned at your expense.
Advertising through Amazon Vendor Central
Amazon Advertising (formerly Amazon Marketing Services or AMS) allows Amazon sellers to advertise on the Amazon marketplace. The vendor advertising options for vendors are very similar to those for sellers and include:
- Sponsored Product Ads — Available vendors and sellers, these keyword-targeted, cost-per-click (CPC) ads are designed to promote individual listings and drive traffic to product detail pages. They’re shown to shoppers who are actively searching for terms associated with a particular product, and appear alongside or above organic search results. Because they target keywords associated with your product, Sponsored Products typically give you higher-quality clicks on your listings — and can yield a much higher ROI than many other CPC programs
- Sponsored Brands (formerly Headline Search Ads) — Available to vendors and sellers, Sponsored Brands can help you reach consumers who are browsing but might not yet know what they want to buy. By targeting generic keywords such as “running shoes” or “smartphone case,” you can help drive traffic to your Amazon Store for the full brand experience. These ads are often found above the search results and can be a great way to introduce your product line to shoppers when they’re looking to discover new products and brands.
- Product Display Ads — Available to vendors, these ads let you target shoppers, both on and off Amazon, who have previously viewed your products. They can be used to deliver highly relevant ads to consumers with certain interests, or to shoppers who are actively viewing specific items. And because these ads are automatically generated from the information on your product detail pages, they’re remarkably easy to set up.
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Amazon Vendor Central provides basic reports on sales and inventory trends, including best-selling, worst-selling and most-viewed items. There are also reports on units and styles shipped and returned. In addition to reporting, Vendor Central also provides demand forecasting.
How to be an Approved Vendor for Amazon
A 1P, vendor relationship with Amazon requires an invitation from Amazon’s vendor management team. Without this invitation, your only choice is to sell as a third party on Amazon. If you’re a large, established brand, you’ve probably already had conversations with this team at Amazon and are doing one of two things: 1) currently selling at least some of your product line via Amazon through a first-party relationship, or 2) consciously not selling directly through Amazon for one or more business reasons.
If you’re a smaller, up-and-coming brand or a large brand that hasn’t had the conversation with Amazon, you’ll need to secure an invitation before you can sell first-party. Invitations are typically sent via Amazon buyers. There are also various third-party consultants that claim that their relationships with Amazon can help obtain these invitations with a high success rate.
Growing your Amazon business
As a driving force behind the global e-commerce landscape at large, Amazon continues to set the stage for successful online selling. Be sure to stay up-to-date on the latest Amazon trends, guidelines and best practices. ChannelAdvisor’s resource centre is continually updated by e-commerce experts who have a deep working knowledge of the latest from Amazon, Google, Facebook and hundreds of other channels.
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