Miva CEO on Thriving in an Amazon-dominant Economy
I recently spoke with him about the book, Amazon, and the prognosis for independent ecommerce. What follows is our whole audio conversation and a transcript, edited for clarity and length.
Practical Ecommerce: Your new book, “Dragon Proof Ecommerce,” is a guide for independent merchants in an Amazon-dominated world. What’s the state of ecommerce in 2019?
Rick Wilson: The condition of ecommerce is thriving. Amazon’s percent of retail ecommerce is growing at the same speed as ecommerce in general. To put it differently, non-Amazon retail ecommerce is growing, too.
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A lot of the media positions Amazon as a Goliath that is going to kill everyone, which isn’t correct. That is why I wrote the book. There has always been a dragon — a dominant force in U.S. retail. It is now Amazon. Not too long ago it was Walmart, supposedly destroying communities. Before that it was Sears. Interestingly, 100 years back, Sears Roebuck had more revenue as a proportion of U.S. gross domestic product than Amazon does now.
PEC: Your book clarifies requirements for achievement in independent ecommerce. What are they?
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Wilson: Numerous things. Having a excellent product discovery experience is the single best thing for an independent ecommerce vendor — helping shoppers find what they need in a manner which is superior to in-store purchasing, if possible.
Here’s an illustration. Borsheims, the Berkshire Hathaway jewellery subsidiary, is a customer of ours. One of the smart things they have on the website is an gemstone builder. It’s Borsheims’ live stock of diamonds, and shoppers can personalize an engagement ring.
Another example is Plant Therapy, plus a Miva customer. They are growing like gangbusters. They sell essential oils, a commodity item, but they built a brand around it. They have developed a Facebook community around the health benefits of essential oils. They then leverage that neighborhood — where folks trade thoughts — back to their own Plant Therapy site. They also sell on Amazon. They have created brand loyalty for what is, arguably, a fairly standard product.
Getting away from Miva examples, consider the growth of subscription box businesses. They’re a sort of product discovery — getting great stuff in the box each month.
Those are the things that I discuss in the book which are defensible in a dragon universe.
PEC: The Borsheims example is a customizable item. Is that a crucial component for success?
Wilson: Customizable products are significant. Commodity items are fine as long as you’re able to create a brand around them, such as what Plant Therapy has done.
PEC: How has Amazon influenced Miva?
Wilson: overall, Amazon has been a net positive for us. Amazon was the first company to build confidence in ecommerce. They have made people comfortable with buying online. From a selling perspective, there are 2 million separate merchants on Amazon. It’s helped lots of sellers to understand that there’s a larger market.
The thing I tell Amazon sellers is this: If you are able to market with gross profit on Amazon, you are not minding your business properly in the event that you don’t also sell directly and independently. Yes, Amazon has rules regarding client data harvesting. But put a guarantee card in there, give a person a present for filling out the card, and get him to visit your site.
PEC: There is a movement of sorts for digitally-native ecommerce businesses to open brick-and-mortar stores. Do you find that accelerating?
Wilson: I really don’t see it accelerating out of our client base, but it might accelerate overall, yes. Both alternatives — bring pure brick-and-mortar merchant into ecommerce and vice versa — are a part of this larger picture of multichannel selling.
Item discovery is a multichannel endeavor by its own nature. We’re in the first days of these experiments. Pop-up stores within larger shops are another example.
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PEC: Where can readers purchase the book?
Wilson: Dragonproofbook.com Provides the best price. Readers can also sign up there to be informed of a podcast we are beginning where I’ll be speaking to merchants about dragon-proofing their enterprise.
PEC: Anything else?
Wilson: Amazon is both a threat and a catalyst to success. Independent ecommerce is increasing at the same speed as Amazon. We are still in the early adopter stage. Only about 13 percent of retail sales in North America are online. The market will continue to evolve at a breakneck pace until 50 percent of retail is online or a combination of online and pickup in-store. Don’t let Amazon frighten you from the game.