There’s plenty to get excited about when it comes to Amazon’s new tech announcements, but one thing that’s worth considering is what we can expect to see from the company in the coming year.
In this article, experts from the Amazon world try to figure out what to expect from the giant in 2022.
Last Year’s Forecasts About Amazon
The best way to predict what the future holds is to look into the past. Were last year’s predictions accurate, or did they prove to be false? Let’s see.
Some predictions made for 2021 have indeed turned out to be true. For example, eMarketer experts predicted that both sales and consumer demand would surge in the first and second quarters of 2021. This graph shows a 44% spike in Amazon 2021 sales during the first two quarters compared to 2020.
Forbes predicted a strong possibility that a permanent switch to online shopping will take place after Covid-19. According to Fortunly, 66% of online users start their searching journey on Amazon, and 82% consider it a vital online retail platform.
In that same post, Forbes assumed Amazon’s usage of drones will increase. In fact, Covid-19 pushed the need for drone delivery beyond expectations. Now, not only Amazon is expanding the number of drone units – many product delivery services are now exploiting these little helpers.
We also have collected all the most important things that happened in 2021 on Amazon in our article. We hope you’ll find it useful!
Amazon Predictions 2022
Amazon is on a mission to shake up the industry with a lot of focus on external traffic that sellers bring to it, partnerships with established brands, DSP, and other creative products.
Thinking about the future of Amazon, we asked several industry experts to share their thoughts on trends that may surface next year.
What Amazon Trends Will Evolve in 2022?
2021 was tough, especially in regards to logistics. Most supply chain experts agree that the going won’t get easier in the coming year. The supply chain challenges facing businesses will escalate moving into 2022, industry experts say. Despite the fact that analytics have made real-time forecasting possible, employers around the world are still struggling with the weight of increasing global trade regulation and disruption.
However, supply chain challenges can be eliminated with the help of proper inventory management. Besides, experts’ opinions vary, and many of them are optimistic. This is what Jack Howard, partnerships associate at Payability had to say on this topic:
There are other opinions regarding supply chain issues which we will talk about later.
Now, let’s discuss customer manipulation on Amazon and how it will act on it in the future. Will Haire, founder & CEO at BellaVix – Boutique Amazon Agency For Ambitious Brands shared some valuable thoughts on this matter:
“After Amazon mentioned specific manipulation tactics in a recent press release, I’m expecting any software that can be manipulated for Black Hat tactics, as well as any third party providing those services and any sellers who knowingly participated will be removed from the platform. Take the press release and the recent update to the Seller’s Code of Conduct as fair warning.”
Indeed, we’ve learned that Amazon takes customer manipulation very seriously and will not turn a cheek to illicit and unethical practices. When Amazon updated its community guidelines in 2018, it banned incentivized reviews. Sellers still face suspension for review manipulation and other abuses.
Hence, note that you can request reviews from your customers, just not the positive ones.
“I expect MYCE (Manage Your Customer Engagement) to evolve a lot further in 2022. I also expect Posts, Amazon Live Video, and the Follow button to see significant more importance in the formation of a new and powerful type of Customer Engagement funnel on Amazon.”
With MYCE, you can market to Amazon customers that are following your brand. This way sellers can boost the visibility of their fresh products and cultivate long-term endorsers of their brands.
A feature of the MYCE program is the ability to run an announcement campaign for novel products. To be able to use it, you have to be brand-registered and have an Amazon store. Furthermore, you need to create captivating posts and grow your followers’ base.
Read more on using Amazon Posts and Stores here.
What Should Sellers and other Amazon Businesses Prepare for the Most?
In 2022, we will probably start to witness the result of the huge changes that Amazon sellers have to come through in order to stay afloat. This is because Amazon is constantly making modifications to its merchandising, relating to the sale approach, and its product placement. According to Troy Johnston, co-founder of Seller.Tools, this is what brands should be ready for:
With Amazon’s massive reach, the retail industry can make or break an enterprise. Making Amazon customers feel like valued guests instead of just another sales-driving buyer requires careful attention to detail and a mix of technical knowledge. The online retailer now drives sales and brand loyalty through positive online buying experiences. If you’re not handling customer reviews, you need to be thinking about how to provide a good experience that will resonate with consumers.
In other words, to deliver excellent buying experiences, you have to be constantly innovating and testing new ways to build a happy customer base. This sometimes requires you to embark on the grand adventure of rethinking your entire business strategy. You may even have to take a step back and frankly think about how you were going to evolve our business and your buyer relationships.
Jack Howard has similar thoughts on this matter:
“The aggregator space will begin to consolidate. On December 10th, European-based Amazon aggregator, Olsam Group, had agreed to purchase US-based aggregator Flywheel Digital. As I mentioned above, close to $10 billion of fresh venture dollars entered the space in the past year alone. As these aggregators look to scale, not just the brands they acquire but also their own institutions, the expectation should be to see more strategic acquisitions. These acquisitions will help companies like the Olsam Group expand their international footprint and improve operational efficiency.“
Many companies have taken to selling their business on Amazon in recent years. If you’re also looking to sell your business, you’ve likely jumped through countless hoops to assemble the perfect package. You’ve analyzed the market, your competition, secured a killer deal and figured out how you’ll profit from the transaction.
Still, with the offer out on the table and the purchase period close to an end, you may be wondering how to close the sale without losing money. If you are looking for a more in-depth overview of the strategies behind selling the Amazon business, check out our article.
Will Haire had his say regarding what Amazon businesses should be prepared for:
We would like to emphasize sustainability because we believe that this topic remains in the shadows much more often than it should. Consumers are becoming more and more aware of the importance of sustainability. The Environics Research revealed that above 70% of consumers state it’s wrong for brands to act as if environmental responsibility has nothing to do with their business.
Brands should be acutely aware of what their customers care about. Storytellers and marketing teams have the exceptional possibility to educate and help their customers find what they need by providing them with their best content.
What Challenges Should Amazon Sellers be Prepared for in 2022?
New and seasoned Amazon sellers need to be ready for the challenges the future will bring. With the focus on the sale and the customer, retail sales in the future will require more effort and investment in the products and services they sell, but without the proper technology, the Amazon sellers will struggle to keep up. The need for product quality, better shipping, and logistics, and agile software are some of the challenges Amazon sellers will need to prepare for in 2022 and beyond.
But it’s also important to understand the economic and technological forces impacting the industry as well as black swans that may surface in 2022. As we already mentioned, Covid-19 changed many aspects of the retail world. The supply chain was affected by it majorly, and while some industry experts believe it will soon be back on track, others are not that sure about it.
Fernando Campos, Amazon expert, co-founder at MarketplaceOps shared his thoughts on what sellers should expect from Amazon in 2022. He considers that “supply chain challenges will remain till mid-2022”.
The post-pandemic economy is battling supply chain challenges all around the globe. You can overcome these challenges by using the following tactics:
- Increasing your prices as stock level drops.
- Having a buffer in case you encounter out-of-stock items after holidays.
- Refining inventory management: this includes scheduling orders and being proactive about stock levels.
- Monitoring competitors: increase your prices as soon as you see that they are out of stock.
Check out Fernando Campos’s LinkedIn post for more info.
Will Haire has some interesting thoughts on maintaining a strong presence on Amazon amid logistics issues:
Outsourcing some of your supply chain aspects is the practice of contracting work to a third-party entity or individual. Usually, Amazon FBA takes care of product delivery, but hiring a 3PL is a pretty widespread practice. The scope of 3PLs is far-reaching and includes inventory management, as well as storage, fulfillment services, shipping, and return logistics, etc.
As a 3PL provides the same services to many companies simultaneously, it can be an efficient way to deal with sales changes and manage projects on a large scale. A 3PL that exactly matches your brand is a must for a successful relationship. Make sure that the 3PL you work with has sustainable resources that can be dissipated with your needs. It is crucial that your fulfillment partner actually meets your requirements so you can prevent customer dissatisfaction.
As for challenges related to fierce competition (you didn’t think it would be easier in 2022, did you?), Michael Yefremov, head of analytics at Profit Whales has some interesting thoughts regarding the topic:
McClain Warren also considers that standing out among competitive brands will be difficult:
“Finding their brand identity, voice, persona and distinguishing themselves from their competitors in a unique way.”
Years ago, when Amazon became the eCommerce apotheosis, many retailers were befuddled by the company. One of the many issues that still bother sellers is how can they single out from competitors? In today’s social media-driven world, the way products are advertised and marketed is evolving, and that includes product identity.
Throughout the years, we’ve seen many brands and stores succeed on Amazon. Some stand out from the crowd by having a unique logo or catchy slogan. Others make what they sell stand out by evoking strong emotions. If you’re a business owner and are looking at how to find your brand’s identity, personality, and distinguishing features, think about your business, what you want your brand to stand for, and what your brand voice should be. Then, use this info to present your product branding on Amazon.
Think about your target audience. The more your brand reaches out and attracts the right readers, the more sales you can expect to make. Your service team, marketing experts, and SEO must work together to provide real solutions for the problems your customers are facing.
What is the Future of Amazon in Regards to the Last Seasons’ Drops in Numbers?
Amazon’s decline in supply over the last few seasons has sparked a lot of talk in social media, many of which range from asking if the retailer will be able to survive another round of significant drops in numbers. For now, Amazon is still on top, but the question remains if they can continue their dominance in the future.
Will Haire is convinced about it:
“Amazon will continue its domination in the US eCommerce space. Although Amazon’s Black Friday and Cyber Monday sales were softer this year compared to 2020. This is more of a reflection on consumers being more comfortable shopping in Brick-and-Mortar during these holidays as well as overall spending being lower. Adobe Analytics is still expecting to see record-breaking eCommerce activity as shoppers spread their spending out over more days.”
Jake Barnett also has optimistic predictions:
“Some normalization after 2020 was anticipated, which was compounded by supply chain issues in 2021, but overall, I would expect eCommerce sales to go up.”
Carlos Alvarez also has optimistic views:
Store discounting has lagged behind the past holiday season, discouraging shoppers from spending more. The rising cost of inflation on fuel, raw materials, and other commodities is forcing sellers to pass on their costs to consumers. Adobe reported a 13.9% year-over-year price increase in Cyber Monday shoppers’ carts. This was also partly due to the fact that more buyers bought more expensive items such as furniture.
What are the Chances of Starting a Successful Amazon Business in 2022?
Every year, thousands of people start their own Amazon businesses. Taking into account experts’ opinions, the chances of being a successful Amazon business are surprisingly high. The trend for selling online is increasing, which means more new opportunities for businesses to sell their goods and services. If you want to get ahead of the curve and learn what the chances are of success, you need to understand how it has grown over the years.
Will Haire thinks that the chances for starting a successful Amazon business now are “as good as ever”. “Now is the time to get in and start building the business of your dreams. Success on Amazon is all about building great products by great brands”, he stated.
Carlos Alvarez agrees:
“The chances to succeed are better than ever on Amazon. I have been a full-time seller on Amazon for nearly 15 years and by far it is easier now to succeed than before. Ability to truly reach a global audience, robust PPC, an abundance of resources to learn as well as the option to hire trusted service providers, clearer than ever TOS, opportunities to differentiate,…the WAYS to succeed have totally changed over the years, but the opportunity to truly succeed is higher than ever. I sincerely feel that if somebody treats this business as a hobby, then it will pay them like a hobby, if they treat it like a business then it will pay them like a business.”
One of the most powerful stories of the past decade has been Amazon’s unrelenting dominance of the North American eCommerce market. They began by disrupting their own business, the online book industry. And now, after years of hard work, the Amazon story is poised to continue. Experts consider Amazon will continue to be a dominant force in online retail despite the global pandemic.
So, if you want to start selling on Amazon, don’t hesitate – now is a good time to do that. We, in turn, are ready to guide you on your way to success. If you need any help, please contact us!