RESOURCES

A couple of weeks ago, MPS had the opportunity to attend the Outdoor Retailer Snow Show in Denver to talk to current and prospective clients. Like most of the industry shows we attend, there are invariably trends in the conversations we had, some specific to Amazon and others that spread across the industry as a whole.

Here are a few takeaways we took from this year’s show:

Falling Speed to Market Creates its Challenges.

Like we do within many categories, we heard frustration from several brands that are finding it harder to innovate and stand out, as business is being conducted faster than it ever has across the world. With it being so easy for brands to quickly source items from overseas, it’s increasingly difficult to create any type of product or variation that remains unique if it is met with any success online.

If a company creates a neon orange ski helmet that’s unique to the market, all it takes is competitors and sourcing companies to notice the product, and in a mere matter of weeks, the category can be saturated with competition, complemented by a race to the bottom on pricing. It’s an unfortunate reality of e-commerce, but brands have to be innovating continuously and must market their products successfully to remain relevant and sustain sales.

The Frequent Use of 3PLs. 

We were surprised to hear how many brands in the category still rely on third-party distributors to control their presence on Amazon. As a firm that works with brands to market their presence on the platform, we’re certainly biased at MPS. But, in our view, the use of 3PLs always struck us as shortsighted.

There is no doubt 3PLs appeal to brands with limited resources and/or marketing knowledge. The thinking goes, if you don’t have the time or know-how to run an Amazon presence, just turn them into another customer by offloading product to a third-party and allowing them to take things from there.

There’s some logic there – and it made sense for a lot of brands in the early days of Amazon -- but over time the drawbacks have become overwhelming. While there are exceptions, most 3PLs don’t typically have the capacity to care for a brand’s presence, optimize content, or monitor the influence of other third parties. They certainly don’t put the budget, time, or energy into implementing a robust product-level advertising strategy (which most products need simply to be competitive on Amazon anymore.) So while we can certainly sympathize with brands who have taken this route as a result of convenience, in our view, the platform has simply become too competitive and drives too much revenue (that can be for the taking when a strong strategy is put in place) to offload the entire process to a distributor.

Make Way for the Massage Gun. 

Invariably, at every industry show, there are one or two new or rising categories that are impossible to miss simply due to the sheer number of brands and manufacturers suddenly exhibiting.

At Expo East in Baltimore last fall, the presence of biltong was almost impossible to avoid.

This time, it’s clear that percussion devices or “massage guns” took the prize this year in Denver. There were several suppliers in attendance in this increasingly competitive market, which makes it no surprise that the category on Amazon is teeming with all the telltale signs of an overgrown category: big brands, dozens of overseas sourced brands, strong content, tons of promotions, and heavy competition for ad space.

The shows we’ve attended over the last several years have given the team at MPS insight into what’s happening in the industry. And the Outdoor Retailer Snow Show was no exception. We look forward to the visiting eTail West and Prosper Show soon to continue meaningful conversations. If you’re attending either of the shows we mentioned, let us know! We’d be happy to schedule a meeting while we’re in town. 

Image Credit: Outdoor Retailer