This is the latest installment of the Amazon Briefing, a weekly Modern Retail column about the ever-changing Amazon ecosystem. To receive it in your inbox every week, sign up here.
This week, Amazon released a report on third-party sellers on its platform. Among other top-line figures, the company announced that it added 200,000 sellers in the U.S. in 2020.
But included in the data was an intriguing revelation about Brand Registry, Amazon’s program for brand owners and authorized resellers that offers analytics data, counterfeit-fighting and other benefits. Amazon announced that 440,000 individual brands are currently enrolled in Brand Registry worldwide. For context, Amazon has around 1.5 million active sellers worldwide, though some of them are resellers and not brand owners.
That stat speaks to how quickly Amazon has grown the program since the middle of 2017. For many big sellers, especially those looking for insights about who is buying their products, Brand Registry has become table stakes. Its main stated use is to cut down on counterfeits: Brand Registry makes it easier for sellers to report knockoffs of their products, and it also gives brand owners control over the look of their product details pages.
But other experts who spoke to Modern Retail see that stat as surprisingly low, especially in light of the fact that Brand Registry is offered for free. That points to Amazon’s enduring struggles to curb counterfeiters and limit unauthorized resellers on its platform, if even a well-liked program designed for brand protection has yet to receive majority adoption. And it also hints at just how many sellers on the marketplace are not associated with the brands they resell.
“Given all of the things that Brand Registry now opens up,” said Ryan Moffett, associate director of e-commerce at the e-commerce growth accelerator Pattern, “I would’ve put that more at the 50% to 70% range” of total sellers who are enrolled in Brand Registry.
It’s possible that some brands, even ones with a fair amount of Amazon experience, still don’t know about Brand Registry as a program. “We have to educate brands all the time on what is Brand Registry,” Moffett said. He said that he’s worked with clients who have been selling on Amazon for years that still don’t know to enroll in Brand Registry.
Smaller sellers in particular might not see it as worth the time investment. Brand Registry does require sellers to have applied for a trademark, which can be costly and involve coordinating with lawyers. (Brand Registry used to expect sellers to have the confirmed trademark, but Amazon recently loosened its rules to allow a brand with a pending patent to enroll.)
“I think a lot of the smaller sellers are not engaging with the program since they might not want to register with a trademark,” said Lori Fields, director of e-commerce and digital marketing at Jay Street Partners. Fields said that she viewed this as a mistake. “I position it for everybody as a necessity,” she said of Brand Registry. “If I had a client that wasn’t interested in doing it, that would give me pause.”
The fact that most brands on Amazon still aren’t in the Brand Registry has tangible consequences for the Amazon marketplace. When a seller is offering a product that is not their own brand — e.g. a reseller offering Tide detergent — they submit their own descriptions of the product. Say there are multiple sellers offering the same Tide detergent: if no seller is in Brand Registry, Amazon collates descriptions from different sellers into the content that consumers see on each product details page. But, in theory, when one seller is enrolled in Brand Registry, their content is prioritized above everyone else’s to better ensure accuracy.
Moffett added that this isn’t always the case. “We’re still constantly submitting cases to Amazon saying hey, the contribution you’re showing on the product details page isn’t ours” and is rather from an unauthorized seller, he said.
Still, it means that if most Amazon brands were in Brand Registry, that would make it harder for inaccurate or unauthorized product descriptions to surface on the marketplace. But as long as Brand Registry is a tool used only by a minority, there’s more room for product information submitted by an unauthorized to slip through the cracks (not to mention counterfeit products themselves).
This challenge isn’t necessarily new for Amazon: Amazon’s other anti-counterfeiting programs, too, have struggled to gain traction. For instance, its Transparency program, which involves putting QR codes on products to ensure authenticity, has faced resistance from sellers concerned about its cost and usefulness.
To get more sellers to enroll in Brand Registry, Amazon has constantly sweetened the pot. Not only does it give analytics information to sellers, but it also offers a ranked report of the top-searched terms on Amazon that sellers have widely embraced. Further, brand owners can use the tool to create branded stores, run “sponsored brands” ads and more. This week, Amazon also announced that it is expanding its brand analytics offerings to include more detailed information on which search terms lead customers to their products.
Incentives like that make Brand Registry difficult to turn down, and the fact that so many sellers have not joined the program might speak to some of Amazon’s weak spots. “From a consumer standpoint, this does actually mean something for the marketplace, because the majority of products that are being sold on Amazon are being sold by sellers that don’t actually have a relationship to the brand,” Moffett said.
Another tidbit from the seller report
“Follow” buttons have begun popping up on the Amazon marketplace, and in its seller report, Amazon highlighted the fact that customers who opt to follow a brand “spend more than double” than those who don’t follow the brand.
The “Follow” buttons are tied to Amazon Posts, an Instagram-like product hosted on the Amazon platform that is only available to sellers in the Brand Registry.
Right now, Amazon Posts is essentially “free advertising,” said Moffett. Moffett said that Amazon has pushed that content to customers with no charge, and some of his brands have racked up tens of thousands of followers just repurposing content from their Instagram accounts.
Amazon news to know:
- Senators are pushing a bill, called the American Innovation and Choice Online Act, that would, among other things, require platforms like Amazon not to push their own products in search results.
- The House Judiciary Committee warned Amazon that it risks a “criminal investigation” for allegedly misleading Congress. Amazon previously claimed to Congress that it doesn’t use third-party seller data to design its own products, but recent reporting on Amazon India says otherwise.
- Amazon and Starbucks have discussed partnering to add co-branded café lounges that blend Starbucks coffee shops with Amazon Go stores. The project, however, may now be on pause.
What we covered:
- Modern Retail had the exclusive on Amazon’s launch of its new seller tool, called the Product Opportunity Explorer, which offers analytics data that shows sellers which subcategories they might use to launch new products.
- The Body Shop, Sephora and other retailers are forging same-day delivery partnerships with companies like Instacart and Uber Eats to more quickly dispatch products to customers ahead of the holidays.
- Home goods retailers and online marketplaces are going all in on gaming furniture.