How Brands Can Compete with Amazon’s CPG Subscriptions

With technology at our fingertips, consumers all over the globe have experienced many conveniences–one in the form of online shopping. In a study conducted a few years ago, it noted that the e-commerce of consumer packaged goods rose by 42%. In fact, Amazon accounted for more than 20% of all the CPG growth.

Scott Galloway from New York University said that Amazon is dominating the retail industry and is undoubtedly evolving. But what makes Amazon the epitome of the retail industry? Simply put, the company delivers its products fast and simple. The brown packaging contains exactly what the clients ordered – no frills and flair involved.

The preference of people to get consumer packaged goods from Amazon has caused fierce competition for the smaller retailers. Although this may spell impending doom to Amazon’s competitors, there are still ways to compete with Amazon, and the secret lies heavily on owning the contact information of their customers so they can build their database and analyze purchase behavior analysis. Creating a competitive subscription service is the key, but, how can this be done?

Create A Dedicated Subscriptions Channel

Dedicate a subscription channel that can handle and connect with consumers. Customer service is critical. For bigger companies, look for a younger yet promising employee who exhibits management skills and IT skills to man the subscription channel. By doing so, they will be in-charge of making real-time reactions to different market conditions and make decisions based on what the customer wants and needs.


Do A Trial Run

Before introducing a subscription, it is important to perform a trial run. The test size for the trial run should be sizable enough that it is statistically significant. It should be marketed on different digital channels and must be done in different variations so that management can determine the best product offering. This means that the trial should involve many (even hundreds) of subscription orders to be able to pinpoint which one justifies the cost per order and the scalability of the campaign. Once the specific subscription has been identified, it is important to do continuous testing as digital channels are always evolving, what works today might not work tomorrow.

Partner with A Subscription-Focused Vendor

Launching a subscriptions campaign requires constant research. Smaller companies can take advantage of hiring technology vendors to create programs for e-commerce, analytics, as well as customer service. While creating a program in-house is easy, the systems necessarily do not communicate with one another and they are not scalable. Partnering with a vendor can provide experienced people who can work on a fully integrated solution, resulting in a faster transaction, better customer experience, and accurate data. Smaller companies can benefit from subscription channels but having their own in-house team to manage can be difficult, so partnering with experienced vendors provides the best solution.

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