Amazon is an ever-evolving online shopper's paradise, continually striving to provide a sophisticated experience as customers try to find the product that perfectly meets their needs in an assortment of an estimated 560 million items across its marketplaces.
With the total number of sellers spanning across these products estimated at over 5 million worldwide, competition is now more significant than ever. This heightened level of competition accelerates the need to create a hassle-free customer experience by not only optimizing Product Detail Page (PDP) content but also by clearly classifying product offerings under a common theme. In a bid to further simplify the customer experience, we believe that Amazon has begun treating an increasing number of categories with high Amazon Standard Identification Number (ASIN) volume differently - variations.
Over the past two years, we have seen variated ASINs growing in global share of sales from 11% in October of 2019 to 17% in May of 2020, and we expect to see these numbers continually increase.
The question you should be asking your Amazon Market Share provider right now: How are you solving for variations?
Since 2018, Amazon has been rolling out a new way of structuring variated (same product, different colors, sizes, etc.) PDPs which has inadvertently rendered older methodologies for estimating market share obsolete. The new variation structure impacts ASIN level visibility, in which key data points, such as sales rank, are the same for each item within the variated set.
Due to variations, most of the standard methodologies available will almost certainly result in inflated sales and share estimates for impacted ASINs, which is caused by misattributing the sales of the total variated set to each item within the variation. Subsequently, these inaccurate sales numbers will affect any Amazon algorithm where sales are a training input for competitive estimations, which could result in ranking or banner issues.
Edge by Ascential's research suggests data variance could be as high as 80%, or more, depending on the ASIN. If your provider hasn't adapted by bringing in more reliable demand signals, your sales and share numbers are likely inaccurate - ultimately affecting your bottom line.
Because variations have such a massive impact on the accuracy of market share estimation, Market Share from Edge by Ascential has invested significant resources into solving this change since we first detected it, almost 2 years ago. We have already deployed several updates to our methodologies, adequately addressing the concern, and we are proud to be able to say that because of this work, we have been able to deliver accurate data accounting for variations on time for over the last 52+ weeks.
Start over, what exactly are variations on Amazon?
Good question. When several variations of an item are available under the same Product Detail Page (PDP), it is considered a "variated item" on Amazon. Items can be variated on several factors, such as color, size, packaging size, etc. The image above shows variation in comforters - broken out by size and color.
Variations on Amazon are sometimes referred to as parent-child relationships. The parent is the main product (for example, fabric softener), and the children are the variants, such as the different scents (lemon and lavender) or different pack sizes (1-pack and 3-pack). An item can have multiple variants, such as a bottle of water that comes in different flavors and different sizes, e.g. strawberry 500ml bottle and mango 1-liter bottle. Variations enable the customer to select the flavor and size they want on the same product page while allowing them to consider all the options available from a single vendor.
How does item variation affect my business? What categories are affected by variations?
In 2019, Amazon expanded its treatment of variated items to a wider number of its product categories, making it much more difficult for brands to track items at the child level. We see ASIN variations across all categories, but they have the most substantial impact on home goods, kitchen, lawn and garden, sports, outdoors, apparel, and baby products.
Fortunately, our dedicated team of data scientists have deep expertise in tracking variated ASINs in the CPG category and have extended our proprietary solution to all affected categories Amazon.
Are variations bad? Can I use them to my advantage?
Actually, variations are an effective way for brands to readily make the customer aware that there are several options for an item available. This helps ease the process of online shopping for a customer since they can immediately seek and select the product suited to their preferences instead of painfully browsing through several search results.
Besides improving the customer experience, variations can help brands in two ways:
- Avoid losing sales to the competition: By having a readily viewable assortment of item variations on the product page, customers are likely to browse the options available on a brand's page instead of moving on to search for a similar item from a competing brand.
- Revive low-performing items by bundling them with high performing items: Say a coffee maker is available in colors black and red, with the black coffee maker being a more popular item with higher sales rank and reviews. By being bundled together with its better-performing counterpart through variation, the red coffee maker shares the same sales rank and reviews, therefore, providing it higher visibility than it could've had by being an item with its own product page.
Should I variate?
If you have an assortment of similar items that can be variated uniformly across these items i.e., the same factor of variation (color, size etc.), then yes, you should variate.
Things to Keep in Mind:
Variating on the same factors is crucial to its effectiveness, and any potential variated items shouldn't be drastically different from each other. For example, while you can variate a dog food item on size and flavor, you shouldn't include a cat food item on the same product page - it must have its own, distinct page.
Further, variations should clearly define their purpose to the customer. If you want to include multiple variations on an item, each option must be clearly labeled for optimal effectiveness.