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Some businesses are hesitant to start selling on Amazon, which isn’t surprising given that Amazon takes a 15% revenue cut. So should your business start selling on Amazon? The incrementality study we ran shows that all signs point to YES!
When an ecomm client stopped selling on Amazon for 30 days, we took the opportunity to measure the incremental impact that Amazon had on the client’s overall business as well as the impact it had on each channel’s performance. We found that when the client ran on Amazon the business garnered more purchases and more traffic at a more efficient rate. Even though it was apparent that Amazon cannibalized some of the sales that would have otherwise occurred through other channels, the net effect when including advertising costs and Amazon seller fees was still more overall purchases for the business at a higher overall ROAS.
Incremental Amazon Impact
- The business drove 29% more purchases when running on Amazon.
- The business had a 15% higher session Conversion Rate (CVR) when running on Amazon.
- The business drove 11% more revenue when running on Amazon.
- The business drove an 8% higher ROAS when running on Amazon.
- The business drove 12% more session traffic at a 9% more efficient rate when running on Amazon.
What Does This Mean for Your Business?
This positive incremental impact tells us that running on Amazon allows businesses to reach an untapped market of individuals who are not converting through “conventional” methods of advertising. Amazon serves as a place for users to shop and as a place for users to discover your product and compare similar products. If your business is looking to effectively engage users at every stage of the purchase funnel, Amazon is the platform for you!
*Analyzed Data Details: The analysis compared 30-day phases of when Amazon was On then Off then On (Phase 1/ Phase 2/ Phase 3) to get an average baseline of performance. Phases 1 and 3 were averaged to mitigate potential seasonality factors. The analysis looked at Facebook Ads, Google Ads, Microsoft Advertising, Amazon Advertising, and all non-paid channel data.