Advanced Amazon Seller competitor analysis strategies
Amazon is a competitive platform. But for many Sellers and brand managers, it’s challenging to make sense of the vast swaths of data and tap into what really matters: figuring out how to beat your competition, expand your market share, and drive sales.
The number one thing to take away from this article is the importance of looking at ASINs first, and brands second. Your competitors online aren’t necessarily the same ones you face outside, and getting granular with data can arm you with the insight necessary to improve performance and make better strategic decisions. In short, detailed data is key to ecommerce success.
Amazon Brand Analytics
The main reporting function built into Amazon is Amazon Brand Analytics (ABA). This tool allows you to access valuable information about search terms, search frequency rank (SFR), conversion shares, customer demographics, product comparison behavior, and more. For most Sellers and Vendors, this is the go-to spot for understanding their competitors and customers.
If you want to get into really detailed competitor analysis, augmenting your ABA data with third-party analytics tools (using AI/ML to find trends and serve up insights) is key. A good tool will pull in transactional-level information from Amazon MWS, and outside sources. Fundamentally, ABA silos data across reporting functions, making it hard to cross-reference information in the most helpful ways.
Although ABA has its shortcomings, there are some advanced strategies for getting the most out of ABA as possible. That is what we are going to look at here.
Taking a closer look
All of your competitor analysis information on ABA is contained within different consumer behavior dashboards. These dashboards are called:
- Amazon search terms
- Market basket analysis
- Item comparison and alternative purchase information
In this article, we’ll explain how you can use the information contained within each of these dashboards to better understand your competition. But first, we should note that there are also new “Demographics” and “Repeat Purchase Behavior” reports on ABA. Check out our eBook on mastering ABA for more information. However, This function won't provide competitor insights, rather focusing on customer information.
Dashboard # 1: Amazon Search Term reports
A good place to start is with Amazon search term reports. As the name suggests, these reports tell you about the trending search terms on Amazon, whether they’re single words or longer phrases. Having access to this data can support your trend analysis efforts and help you understand your competitors (and customers) in a broad sense. It can also help you make your PPC campaigns more effective. To explain, let’s look at some specific use cases.
Use Case 1: Understanding how competitive terms are
The most obvious use for this reporting function is to understand how competitive particular search terms are. To find out this information, you can look terms up by either their category or specific words or phrases. ABA will then provide you with the top-ranked ASINs by click share. This reporting can cover between one and three ASINs, depending on the percentages. Performing this type of keyword research also enables you to identify your primary competition — the brand whose product holds the number-one spot.
Pro Tip 1: A click-share number of above 70% or 80% indicates that this is going to be a hard category to break into.
Pro Tip 2: Don’t be intimidated by low traffic. Keywords with less traffic might still prove lucrative for certain products, while those with heavy traffic could have a higher cost per click (CPC) due to more substantial competition.
Use Case 2: Understanding who your competition is
Another useful technique to see who you’re competing with is to run searches of the most obvious search terms for your product. Then, simply look at the top three converting ASINs, and, just like that, you’ve just identified your competition.
Once you identify the top three converting ASINs, you can use this same report to perform a reverse ASIN lookup. Doing so will enable you to look at the search terms a specific ASIN ranks for, instead of doing it the other way around. A reverse ASIN lookup will tell you other relevant search terms because Sellers can target ads on an ASIN-by-ASIN level. If there is a common group of ASINs that keeps showing up on a sponsored-product level, this could indicate that a particular brand is targeting you.
Limitations of these reports
Although Amazon search term reports can give you a sharper picture of your competition, they aren’t necessarily detailed enough to provide you with the whole picture. The problem with both of the options in our use cases is that they only tell you what the products are, their click share, and their conversion share. ABA doesn’t allow you to view information such as search volume for specific keywords — only their relative position. And if you want to know anything else about the product listings you’re competing with, you’ll need to look up that information manually per ASIN.
Dashboard # 2: Item Comparison report
The Amazon Item Comparison report looks at your ASINs and lets you view the top five other products someone looks at after they click on your product. These five products are determined in aggregate, on average.
However, Item Comparison only gives you the ASIN for the products you’re competing with. Just like with search terms, if you require more product page information, you’ll need to spend time looking that up on your own. Some factors that might prove useful here include:
- Product reviews
- Product descriptions and unique selling points
- Star ratings, unique selling points
- Keywords your competitors are using
In essence, while the Item Comparison report is a beneficial function, the way the data is presented in ABA doesn’t really provide advanced Sellers with enough information to make informed decisions about what they need to do in order to compete.
One option is to build out this information manually with spreadsheets. The shortcut option here is to use third-party analytics tools, which can automatically search for and extract that information and present it to you in the formats you find most useful.
Dashboard # 3: Alternate Purchase report
When someone clicks on your ASIN but doesn’t buy your product, what do they buy instead? The Alternate Purchase report gives you that answer, on average. It tells you what the most common five alternative purchases are, and the percentage of the time your product is compared with each of these five other purchases.
This report is found within the same ABA tab as the Item Comparison report. Again, however, there are inherent limitations here. Just like the Item Comparison report, you won't get any context about the listed items. No pricing, no star ratings, no real insights. You’ll need to build out that information manually or deploy a third-party tool to simplify the process.
It’s also important to note that the percentage figures provided by the Alternative Purchase report relate to the percentage of individuals who went on to make a purchase, not the total number of clicks. People who simply click on your product and make no purchase are not captured by this report. If you are really competing against ‘no purchase’, this report can provide misleading information.
Dashboard #4: Market Basket Analysis
Market Basket Analysis supplies insights into the top items customers have in their shopping cart alongside yours when making a purchase. Realistically, this is pretty noisy data (shoppers regularly purchase unrelated items and keep items in their shopping cart for a long time). However, this report can help you better identify trends in the Item Comparison and Alternate Purchase reports.
You should regularly cross-reference the data coming from the Item Comparison, Alternate Purchase and Market Basket Analysis reports. If you notice similar items showing up in two or three of these reports, take that seriously.
Demographics and Repeat Purchase Behavior
ABA provides two other reports — Demographics and Repeat Purchase Behavior. These reports focus more on customer behavior than direct competitor insights. However, you should not ignore this information, even when just focused on competitor analysis.
The Repeat Purchase Behavior report helps you understand how many total customers you actually have — highlighting the number of unique purchases per product. Use this information to contextualize your other reports.
The Demographics report won't tell you anything about your competitors directly, but it will help you better understand your customers — providing insights into which brands you are likely competing against. However, this is likely the least useful competitor analysis report in ABA. As we will get back to, you should focus on ASINs.
Is your competition cheating?
Unfortunately, there are Amazon sellers who cheat and violate the terms of service in an attempt to beat out their competition. The most common tactic that these Sellers use is keyword manipulation. To manipulate keywords, some brands operate bots that run searches. The bots then click into the targeted product and perform behaviors to lift the product’s keyword ranking without requiring an actual purchase. Essentially, this means that brands can cheat the system and boost their overall keyword ranking without spending money on ads.
The good news is that you can use ABA to determine if your competition is using unfair tactics to boost their keyword rankings and Amazon sales. Here are the three leading indicators of keyword manipulation to look out for:
- The product shows a 0.00% conversion share.
- The product does not rank in the top two pages, and is not running sponsored ads.
- The product has a significant click share, of upwards of 60% for a single ASIN.
If you discover your competition is in fact cheating, you can then use the evidence to report these violations to Amazon.
Always go from ASIN to brand, and then focus on actions
As we said, always go from ASIN to brand, and then focus on actions. If you focus on brands, the brands might have a large number of irrelevant ASINs. For instance, if you were to focus your competitive research on LG, you’d soon discover that this brand sells everything from televisions to dishwashers to mobile phones. It’s pointless, in such cases, to compare your one specific product to an entire brand portfolio.
This is probably the most significant perception shift between selling on Amazon and selling in stores or through your own website and social media. Brand-to brand-competition can matter, yes. And yes, sponsored brand ads are useful, as they can help you build a brand presence on Amazon. However, the granularity and options on online shopping make product-to-product competition all the more important. On Amazon, products come first.
If you are an Amazon-first brand, you have probably grown up with that level of granularity. If not, this might be a relatively new concept. Either way, all brands need to keep in mind that your competitors on Amazon are not necessarily the ones that you have in the outside world.
Data can deliver — but only with the right tools
On its own, data is basically meaningless. You need to contextualize that data and learn how to turn it into actionable insights. This is what makes using ABA a challenge. Sure, it tells you about who your competition is, but the dashboard doesn’t provide a simple way to visualize why they are beating you.
To contextualize the data you’re given, here are some of the questions you’ll need to answer:
- Are your competitor’s prices higher or lower than yours?
- Do they have more reviews or better reviews than you do?
- Do they have better listings and product descriptions?
- Are your competitor’s ad campaigns and strategies more effective? And if so, why?
Analytics software can provide you with shortcuts to these answers. The right information can help you determine a list of the ASINs you should target, show you the priority order that will be easiest to attack, and offer insights on how you should go about making changes that will make the most difference. In doing this, you can also learn about who your biggest competitors are overall.
Ultimately, you can come to most of these answers using just ABA, but you are going to need to build out spreadsheets and constantly update them. However, no matter how you get there, remember that looking at products on a granular level is key to finding success on Amazon. Follow the products, not the brands.