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"That's what we set out to do, is answer this question about Amazon maturity. And how we came to that was in thinking about 'what do our most successful clients do differently?' What we found was that these brands who are successful on Amazon that we work with just seem to behave differently. They approach their Amazon channel in a unique way. They look at new growth opportunities differently." — Kiri Masters, CEO and Founder of Bobsled Marketing
Amazon is the largest online marketplace in the world, but that doesn’t guarantee multi-million-dollar sales.
Winning on the platform requires a carefully crafted and well-executed Amazon success strategy.
Kiri Masters and Caroline Adams of Bobsled Marketing, an agency that serves as the Amazon digital marketing agency of record for more than 125 brands, witness firsthand what the best brands do to win on Amazon and where other companies often fall short.
Masters and Adams joined a recent episode of the "Unpacking the Digital Shelf" podcast, "How To Be a Beast on Amazon," to share what makes some companies lions on Amazon and others caterpillars — and the key steps they can take to advance their maturity.
Bobsled released a new report, "The Amazon Maturity Matrix - 6 Factors That Drive Results On Amazon," that organizes brands into four main categories based on their Amazon maturity. The different categories include:
Masters, Bobsled’s CEO and founder, says her agency’s work with clients has given her team an inside view into the key behaviors, strategies, and tactics that drive success on Amazon.
"That's what we set out to do, is answer this question about Amazon maturity. And how we came to that was in thinking about 'what do our most successful clients do differently?'" Masters says. "What we found was that these brands who are successful on Amazon that we work with just seem to behave differently. They approach their Amazon channel in a unique way. They look at new growth opportunities differently."
In creating their matrix, Masters says her team discovered that two critical attributes shape a brand’s Amazon maturity: engagement and execution.
"What we discovered was this axis of engagement and execution. Engagement is having a clear objective for the Amazon channel, having a vision for what the outcome should be, having executive buy-in from the very top of the organization and support from the very top, and curiosity," she says. "The other factor is execution. This is having the resources — whether that's people, budget, skills, or the attention on the channel."
As the above list shows, lions have both high engagement and high execution on Amazon. They are the model to which all other brands should aspire.
Lions take calculated risks, move fast, and know when to pivot.
Adams says lion brands have advanced maturity and an effective Amazon success strategy because they are actively engaged on Amazon.
"They have a clear vision of what their future looks like. They have goals and they have expectations. And not only that, they are executing on those goals and those expectations," she says.
Their vision is well-articulated throughout the entire company, so every team member knows their role and how they contribute to the overall mission.
Adams gave the example of a Bobsled client that was dealing with inventory stock-outs on Amazon. The brand put a strategy together to quickly pivot and address the problem, which included changing its packaging and shipping.
Executing the strategy required a high degree of collaboration, especially between its supply chain and ecommerce teams, but because every team member understood the vision and their role, the company was able to seamlessly execute a shift in strategy.
"It's really about acting as a cohesive unit, just like a lion’s pride," Adams says. "They all act together. They act cohesively and they know from that perspective what their role is in the execution."
Caterpillars, spiders, and chameleons need more help advancing their Amazon maturity and formulating their Amazon success strategy because they grapple with a mix of low and high engagement and low and high execution.
Adams says caterpillars love the status quo and are stuck in their way of thinking.
"A lot of these bigger brands or brands that are layered with hierarchy, want to do it their way, as opposed to doing it 'The Amazon Way.' A really important piece about Amazon is Amazon's playground. If you really want to be successful on Amazon, you have to do it the Amazon way, and you have to morph that platform." — Kiri Masters, CEO and Founder of Bobsled Marketing
By comparison, chameleons are opportunistic rather than strategic in their approach to Amazon. They lack a clear vision and aren’t great at keeping pace with rapid changes in ecommerce.
Spiders, on the other hand, "get stuck in their own web of bureaucracy," the Bobsled team says in its report. These brands are willing to learn and actually have an opportunity to be successful on Amazon — they just get in their own way and lack the agility to execute at a high level.
Spiders, chameleons, and caterpillars can learn several key lessons from lions, starting with setting clear objectives and aligning their key performance indicators (KPIs) to these objectives.
Masters says lions track meaningful KPIs that are consistent with their organization’s larger strategic goals. They don’t waste time chasing shiny objects.
For example, they don’t focus on profitability metrics, like advertising cost of sales or return on ad spend (ROAS), when they’re more focused on driving growth or increasing market share.
Masters adds that chameleons — who rank just under lions on the maturity scale — can eventually become lions by prioritizing Amazon in their supply chain, which can help them avoid stock-outs that hurt their revenue.
"What we found across our most mature clients is that 85% of them prioritize Amazon in their supply chain efforts," Masters says. "The reason why that's important is that going out of stock is one of the worst things that you can do on Amazon. You don't just lose your sales during that out-of-stock period, you actually lose a lot of the sales momentum in a residual fashion afterward, as well."
Bobsled has given brands a framework to assess their Amazon maturity.
They can take an assessment on Bobsled’s site — the "Amazon Savviness Score" — to see whether they’re a lion, chameleon, spider, or caterpillar, and then get recommendations for how they can improve their Amazon capabilities.
Adams says many brands often think they have more mature capabilities on Amazon than they really do. However, the assessment provides an objective measure they can use to truly understand their current gaps and advance their maturity from wherever they are.
"There's so much opportunity on Amazon that a lot of brands or sellers feel that all they need to do is get a product on Amazon and it will sell itself," Adam says. "There's a false hope or false expectation that 'I'm putting my product on the biggest platform out there and I'm going to make millions overnight because here I am on the Amazon platform,' and that's just not the case."
For more details on how brands can craft a winning Amazon success strategy, check out the rest of this episode of "Unpacking the Digital Shelf."
