E-Commerce Businesses: State of the Merchant Report for 2019

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Are we seeing a plateauing of Amazon? Those who think that any type of e-commerce conducted outside of Amazon is a dead-end are dead wrong. Today we welcome back Andrew Youderain to discuss his third annual State of the Merchant Report for 2019. If you’ve never read or heard us talk about the report, it’s a comprehensive report of all things e-commerce that comes from Andy’s exclusive database of real entrepreneurs, all running physical product e-commerce businesses.

With more than 400 qualifying merchants completing the questionnaire, the report covers an array of important topics including growth and conversion rates, profitability stats, advertising ROI, and even one surprise question about ways our members would fulfill their biggest indulgences. We’ll go over all the questions, responses, and the surprising trends in e-commerce for 2019.

Episode Highlights:

  • What is providing the best return on investment in terms of advertising?
  • The facebook marketing factor, why it’s so different, and how can be tricky.
  • A shout out to email marketing as a very valuable and viable advertising tool.
  • The reality of advertising fatigue and the big three – Google, Amazon, and Facebook.
  • The typical store owner makeup and whether dropshipping is coming to an end.
  • Surprising gains in manufacturing of original merchandise.
  • The impact of the new tariffs on the surveyed businesses.
  • Does everything seem to be growing? We discuss general growth rates in the e-commerce industry.
  • The surprising thing we learned from the survey this year regarding Amazon.
  • The place for premium and niche products.
  • Andrew’s top three takeaways from the survey.
  • A rise in Chinese sellers on Amazon and what that means for e-commerce merchants and counterfeiting.
  • Andrew’s view on the FBA nexus and the state to state tax impact for his community of clients.
  • The fun and surprising final question in the survey.

Transcription:

Joe: Mark back in Savannah I think it was 2016 was the 2nd time I ever went to eCommerceFuel. In a great location because I could drive there and it was a beautiful, beautiful location. And I was so proud because I brought copies of my e-book some would call it a book called 10 Steps to Selling your Amazon Business and this is back in ’16. We’re talking years ago. And so I thought I was at the forefront of things. And then Andrew does his presentation at the beginning of eCommerceFuel events which was really the state of commerce back then and what we’ve had him on the podcast about what this podcast today is about. The 1st thing he talks about is how few of the eCommerceFuel attendees are using Amazon; like less than 10%. And it was a very small part of their business and that Shopify and other channels were much, much bigger. And I was slightly mortified. But then the next year, the biggest growth I think in 2018 that we saw—actually it was at ’17 because we stated e-commerce from Andrew in 2018 and the biggest growth factor was Amazon. And now that you’ve had him on again I think that that’s changed a little bit, right?

Mark: That’s right. In this year’s State of the Merchant Report from eCommerceFuel, they’ve found that this is the 1st year that non Amazon e-commerce stores outpaced Amazon as far as new sales channels which is pretty amazing when you think about the impact. The quote directly is this was the 1st year non Amazon sellers grew faster than those on the platform. So there’s more growth happening off of Amazon among their members than on the Amazon platform. That’s pretty remarkable to hear that because it feels like feels like every

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