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We’re pretty certain that Amazon customers don’t know (or care) what type of seller account was behind their recent purchase. They’re shopping for a product and simply want it delivered as soon as possible. 

However, Amazon buyers are often buying from two very different selling platforms, Amazon’s Vendor Central, and Amazon Seller Central. 

The main difference between Vendor Central and Seller Central is who is selling those products. With Seller Central, (probably using the Fulfillment by Amazon (FBA) platform), sales are made directly to Amazon shoppers. 

On the other hand, Amazon Vendor Central is an invite-only portal created to allow manufacturers and customers to connect. In this platform, Amazon is functioning as the distributor or middleman. Referred to as 1P (or first party), this means that participants sell their products directly to Amazon. Amazon then turns around and sells those products to customers.

Key Elements of Amazon’s Vendor Central Platform

• Vendors sell in bulk to Amazon, which handles listings, pricing, fulfillment, and customer service.
• Products are listed as “Ships from and sold by Amazon.com.”
• Vendors receive purchase orders, fulfill them, and get paid based on agreed terms.
• It still offers the usual marketing tools such as A+ Content and Amazon Marketing Services (AMS).
• Amazon sets prices, giving vendors less control over pricing and inventory.
• Ideal for larger brands able to meet Amazon’s bulk order requirements.
• Analytics tools help track sales performance, but the platform may offer lower profit margins and less listing flexibility.
• Some businesses use a hybrid approach with both Vendor and Seller Central.

What are the Potential Downsides of Amazon’s Vendor Central?

One of the biggest e-commerce challenges that a long-time Canopy partner faced was actually taking the big step of LEAVING Amazon’s Vendor Central selling platform. Between the ability to seamlessly transact such large quantities and Amazon’s quick payment terms, departing what had been a profitable business model was not easy. 

Selling on Amazon’s Vendor Central Platform isn’t without its own challenges. Here’ a quick look at a few of them:

Limited Pricing Control: Amazon sets retail prices, which can lead to issues like:

• Ignoring Minimum Advertised Price (MAP) guidelines.
• Disrupting pricing strategies across platforms.
• Reduced profit margins for vendors.

Strict Logistical Requirements and Chargebacks: Vendors face strict fulfillment guidelines, which may result in:

• Chargebacks for inventory or order fulfillment delays.
• Complex order processing requirements.
• Penalties for late shipments, damaged goods, or fulfillment errors.

Loss of Brand Control and Customer Interaction: Vendors experience reduced control over:

• Product presentation on Amazon.
• Customizing the buyer experience.
• Direct customer interactions, limiting the ability to build relationships or address issues directly.
• Relying on Amazon’s customer service for quality control and shipping concerns.

The Partner’s Challenge

As the new partner struggled to make the move to Seller Central, their advertising cost of sales was averaging 36%. For the Canopy partner, it wasn’t working. They wanted more control over their business trajectory and reached out to the team at Canopy Management to help them navigate the transition. 

Our initial audit found that the partner’s Amazon advertising lacked sufficient structure, a contemporary blend of ad placements, and ultimately, a well-calibrated marketing target. 

At the top of their wish list was more control over product pricing, inventory management and product launches. They also understood that they lacked an emotional connection with their end users that would help inform their advertising campaigns.

Ultimately, the decision was made to reach out to Canopy Management. 

Canopy’s Pay per Click advertising experts have found that when it comes to competitive product niches, Amazon advertising offers the best value at any level of e-commerce ad campaign investment. 

A first step that Canopy always takes is to make sure that we’re completely aligned with our partners when it comes to their desired outcome. 

The Partner’s Wishlist:

• Growth in overall sales and Sponsored sales
• Dominate the categories 
• Consistently optimize ad campaigns to achieve optimum spend-to-sales performance
• Run and optimize ads for products that have not yet been promoted
• Lower (then maintain) Advertising Cost of Sales under 20% 

How Canopy Management Solved the Problem

Canopy Management was determined to structure a full-funnel strategy, taking advantage of Amazon Sponsored Products, Sponsored Brands, and Sponsored Display. That helped expand the brand’s product visibility to a much wider range of potential customers, both sponsored and organic. 

That first step required a detailed, in-depth analytical investigation of the partner’s competitive landscape in order to fully capitalize on the knowledge gained from the advertising investment. 

Canopy then took the following steps:

• Canopy conducted extensive keyword research to identify lesser-known, highly-converting search terms
• By creating a solid ad platform structure for each product group, Canopy niched down for every product (even including size as a factor)
• Utilizing Amazon’s latest beta, Canopy’s advertising team was able to automate the sometimes tedious campaign creation process to make sure every corner of the advertising map was covered.
• Canopy established a Master Portfolio for pivotal product groups that made it easier (for Amazon) to decide what to show to shoppers
• To gain more control over product groups and eliminate wasted ad spend, Canopy developed an Alpha/Beta testing structure for every one of the partner’s products.
• In order to take full advantage of Amazon’s ad real estate, Canopy implemented the full range of Amazon’s advertising platforms. Amazon Sponsored Products, Sponsored Brands, and Sponsored Display were all used. 

The results were almost instantaneous. In the very first month . . .

RoAS (Return on Ad Spend) Skyrockets from 280% to 719%

In the very first month the partner’s overall profitability skyrocketed from an existing average Return On Ad Spend of 280% to 719%. As indicated in the screenshot below, Canopy’s ad strategy went on to average a 680% Return On Ad Spend.

Sales Increase of 30% in the First Month and 15% each month since!

Not only did sales increase by almost 30% in the first month, the new partner has averaged a Month Over Month sales increase of between 10% to 20% every month since.

Amazon Advertising spend has functioned as the engine of their success and it’s still growing. Below, you can see that they increased their Amazon advertising spend 47% in the first month and have continued to boost their spend between 20% and 30%, month-over-month each successive month since that time.

One month before partnering with Canopy Management, the partner’s sales had plateaued at $72,000.00 with Advertising Cost of Sales of 36%. After Canopy’s extensive restructuring of the advertising campaign, sales more than doubled to $158,000.00 and Advertising Cost of Sales plummeted to 14%. 

Winning Amazon Choice badges is always a good sign that Amazon sellers are heading in the right direction. Canopy Management very quickly helped the partner to dominate the categories that refer back to key terms that were previously identified. 

At the present time, as shown below, the partner has earned Amazon’s Best Seller badges for their pivotal products. 

A “Rising Tide” of E-Commerce Success

More importantly, as the series of screenshots below show, the “rising tide” of success was driving sales and pulling the remainder of the partner’s product catalog towards the top of Amazon’s first page as well.

Notice a trend in the above screenshots? One of the best things about establishing powerful sales momentum for your principal ASINs is that kind of success doesn’t happen in a vacuum.

In many cases (like this one), your entire Amazon business will benefit!

How Canopy Management Can Help

What would adding 67% more organic sales mean for your brand?

Turns out that when you combine the massive experience of Canopy’s Amazon Advertising Experts with smart tools and tech, you get industry-leading results like this:

• 84% Average Year-Over-Year Profit Growth for Our Partners
• 2.7 Billion in Revenue Managed
• 99.1% Partner Retention Rate

Canopy Management is a full-service marketing agency for Amazon and Walmart sellers. Our team consists of former Amazonians, multi-million dollar sellers, and award-winning experts.

When you consider the many ways that Canopy Management can help you grow your business, you’ll see why selling on Amazon is much easier “under the Canopy.”

• Amazon Review Aggregation
• Strategic Growth Planning
• Listing Copywriting Optimization
• Listing Photography
• Product Videography
• Advertising Management
• Customer Service
• Demand Side Platform (Amazon DSP)
• Amazon Posts
• Full Service Management