Sell your Amazon business and run off into the sunset with all the money in the world. Too good to be true?
We’re witnessing a spike in the number of Amazon aggregators raising millions or maybe billions of dollars in venture capital. Some of the well-recognized examples include (subject to change):
Top Amazon Aggregators
Thrasio
- Capital Raised: $3.4B
Berlin Brands Group
- Capital Raised: $1.3B
Perch
- Capital Raised: $908M
Heyday
- Capital Raised: $800M
Razor Group
- Capital Raised: $572M
SellerX
- Capital Raised: $267M
With an ever-increasing number of Amazon sellers kickstarting their Amazon venture – and with them representing $300B in gross merchandise value, venture capital and investors all across the globe are looking forward to getting onboard.
Rather than purchasing these Amazon storefronts directly, VCs and investors are funding Amazon aggregators – who then purchase and grow dozens of eCommerce storefronts. And that’s not just the Amazon storefronts we’re talking about. If you sell your Amazon storefront to them, they’d probably be interested in purchasing your brand – as a whole – from you.
But that’s subject to negotiation.
For example, Thrasio, an Amazon aggregator that has raised $3.4B up until now, has purchased countless both on and off Amazon businesses since their inception – 2018.
Similarly, we’re witnessing brands like Perch, SellerX, Razor Group, Heyday gaining traction and closing a series of deals, helping VCs and investors boost their profitability and earn top dollars.
And while selling your Amazon storefront to an Amazon aggregator is one of the hottest trends in the eCommerce sector, third-party sellers are often left wondering, “Should We Be Selling Our Amazon Storefronts to Amazon Aggregators?”
To clear your doubts and help you make a mindful decision, we’ve prepared this blog post – where we’ll be diving deep into Amazon Aggregators.
To get started, let’s learn what are Amazon aggregators and who the top Amazon Aggregators are.
What are Amazon Aggregators?
In a nutshell, Amazon aggregators are nothing but acquirers or consolidators. The top Amazon aggregators like Thrasio, Berlin Brands Group, Razor Group, and more are backed by VCs and investors.
Their business model is simple. Let’s head over to Thrasio’s website to gain a much better understanding. Upon visiting their “Contact Us” section, you’ll see their Contact Us form pop right in front of your screen.
Influencer marketing has predominantly been used by online eCommerce sellers to promote products or services, but recently Amazon sellers have started to use influencer marketing to boost their product listing rankings and to accumulate user-generated content for their brands. If you are an Amazon seller looking to increase your brand presence online, get a stream of initial sales or get user-generated content to utilize in advertising, social media or other marketing initiatives, then you should definitely consider flirting with the idea of an influencer marketing campaign.
Influencers don’t have to be users who have massive followings, either. There have now become different terms for various influencers (i.e. micro-influencers, mega-influencers, etc.). As an Amazon seller, I would personally recommend working with “micro-influencers” – social media users with 1,000 – 10,000 followers who are willing to promote your brand in exchange for a free product instead of getting paid. You could hire a macro-influencer (10k - 100K followers) or a mega-influencer (100K+ followers), but you will end up shelling out hundreds or thousands of dollars for a single post that will most likely be taken down after a day. There are numerous benefits to working with micro-influencers as an Amazon seller which include higher engagement rates, lower expenses and more reusable branded content to name a few.
And if we just look at the options in their “Total Annual Revenue” part, you can see:
Influencer marketing has predominantly been used by online eCommerce sellers to promote products or services, but recently Amazon sellers have started to use influencer marketing to boost their product listing rankings and to accumulate user-generated content for their brands. If you are an Amazon seller looking to increase your brand presence online, get a stream of initial sales or get user-generated content to utilize in advertising, social media or other marketing initiatives, then you should definitely consider flirting with the idea of an influencer marketing campaign.
Influencers don’t have to be users who have massive followings, either. There have now become different terms for various influencers (i.e. micro-influencers, mega-influencers, etc.). As an Amazon seller, I would personally recommend working with “micro-influencers” – social media users with 1,000 – 10,000 followers who are willing to promote your brand in exchange for a free product instead of getting paid. You could hire a macro-influencer (10k - 100K followers) or a mega-influencer (100K+ followers), but you will end up shelling out hundreds or thousands of dollars for a single post that will most likely be taken down after a day. There are numerous benefits to working with micro-influencers as an Amazon seller which include higher engagement rates, lower expenses and more reusable branded content to name a few.
And that’s huge.
This means – Thrasio doesn’t acquire all Amazon storefronts. Instead, they purchase storefronts with a decent-huge profit margin. The higher the margin, the better will be the offer you get.
NOTE – Thrasio doesn’t just acquire Amazon businesses. In their “What is your business section,” you can see the following options:
Influencer marketing has predominantly been used by online eCommerce sellers to promote products or services, but recently Amazon sellers have started to use influencer marketing to boost their product listing rankings and to accumulate user-generated content for their brands. If you are an Amazon seller looking to increase your brand presence online, get a stream of initial sales or get user-generated content to utilize in advertising, social media or other marketing initiatives, then you should definitely consider flirting with the idea of an influencer marketing campaign.
Influencers don’t have to be users who have massive followings, either. There have now become different terms for various influencers (i.e. micro-influencers, mega-influencers, etc.). As an Amazon seller, I would personally recommend working with “micro-influencers” – social media users with 1,000 – 10,000 followers who are willing to promote your brand in exchange for a free product instead of getting paid. You could hire a macro-influencer (10k - 100K followers) or a mega-influencer (100K+ followers), but you will end up shelling out hundreds or thousands of dollars for a single post that will most likely be taken down after a day. There are numerous benefits to working with micro-influencers as an Amazon seller which include higher engagement rates, lower expenses and more reusable branded content to name a few.
On the other hand, there are also Amazon aggregators like SellerX that are laser-focused on purchasing Amazon storefronts.
Influencer marketing has predominantly been used by online eCommerce sellers to promote products or services, but recently Amazon sellers have started to use influencer marketing to boost their product listing rankings and to accumulate user-generated content for their brands. If you are an Amazon seller looking to increase your brand presence online, get a stream of initial sales or get user-generated content to utilize in advertising, social media or other marketing initiatives, then you should definitely consider flirting with the idea of an influencer marketing campaign.
Influencers don’t have to be users who have massive followings, either. There have now become different terms for various influencers (i.e. micro-influencers, mega-influencers, etc.). As an Amazon seller, I would personally recommend working with “micro-influencers” – social media users with 1,000 – 10,000 followers who are willing to promote your brand in exchange for a free product instead of getting paid. You could hire a macro-influencer (10k - 100K followers) or a mega-influencer (100K+ followers), but you will end up shelling out hundreds or thousands of dollars for a single post that will most likely be taken down after a day. There are numerous benefits to working with micro-influencers as an Amazon seller which include higher engagement rates, lower expenses and more reusable branded content to name a few.
Now, you may be left wondering – what’s in it for these companies, right? Why are they paying such hefty dollars to Amazon storefront owners for their stores?
Answering this question, these aggregators have their own marketing and sales departments. When we say – they’ll be buying your Amazon storefront, they won’t just be buying your Amazon storefront. They’ll be buying your entire operations – from Amazon account to manufacturing to your off-Amazon stores – everything.
However, that’s subject to discussion. Amazon aggregators are becoming a huge part of the Amazon ecosystem. And when they buy your Amazon storefront, they’ll be using their resources to scale your brand and boost their profit margins.
These aggregators hold the potential to turn these Amazon storefronts into global businesses with a steady cash flow. From their marketing finance departments, Amazon aggregators have all the resources they need to build a profitable business – and by selling your Amazon storefront to them, you’ll be giving them a boost.
Amazon aggregators are looking for:
- Registered eCommerce brands selling their self-branded products.
- FBA brands with a decent-high profit margin
As a third-party seller, you may not really want to sell your baby (Amazon venture) for a lump-sum amount. And while that amount may be huge, you may want yourself to be a part of it. So – you can negotiate with the Amazon aggregators yourselves to reach the middle ground and maybe operate on a shared revenue model.
All of it depends on the terms.
Should You Sell Your Amazon Business to Amazon Aggregators?
We understand that your Amazon storefront may be your baby. Amazon is a $1.7 trillion company – and in the near future, we’ll be witnessing it reach the moon (not practically.)
Maybe when Elon Musk takes us to the moon (pun intended), we’ll have an Amazon storefront there – who knows what the future holds?
As we mentioned before, Amazon aggregators have all the resources and experts in the world who’d love nothing more than to scale your Amazon business and operations upon acquisition.
From their marketing department to their logistics, they’ll build a streamlined process to turn your business into a global company. However, Amazon aggregators like Thrasio & SellerX, before they buy your Amazon business would love to understand whether your business is the right fit for them.
After all, if they are purchasing your business for millions of dollars, they need to make sure that your business is the right fit for them. At the same time, upon acquisition, they’ll take care of your business like it’s their own baby.
Upon acquisition, Amazon aggregators focus on increasing the inventory to expand their operations and hit the global market. With their knowledge and logistics experience, they can make the necessary adjustments and at the same time promote your business to boost the profit margins.
Here’s a diagram perfectly representing the End-to-End ecosystem:
Influencer marketing has predominantly been used by online eCommerce sellers to promote products or services, but recently Amazon sellers have started to use influencer marketing to boost their product listing rankings and to accumulate user-generated content for their brands. If you are an Amazon seller looking to increase your brand presence online, get a stream of initial sales or get user-generated content to utilize in advertising, social media or other marketing initiatives, then you should definitely consider flirting with the idea of an influencer marketing campaign.
Influencers don’t have to be users who have massive followings, either. There have now become different terms for various influencers (i.e. micro-influencers, mega-influencers, etc.). As an Amazon seller, I would personally recommend working with “micro-influencers” – social media users with 1,000 – 10,000 followers who are willing to promote your brand in exchange for a free product instead of getting paid. You could hire a macro-influencer (10k - 100K followers) or a mega-influencer (100K+ followers), but you will end up shelling out hundreds or thousands of dollars for a single post that will most likely be taken down after a day. There are numerous benefits to working with micro-influencers as an Amazon seller which include higher engagement rates, lower expenses and more reusable branded content to name a few.
Amazon aggregators have the funds, market access, marketing experts, and expertise needed to scale your operations globally.
Amidst this, you may not really want a lump-sum amount – as a part of your acquisition process. Maybe, a 10% profit margin seems reasonable. And while most Amazon aggregators offer lump-sum amount as a part of the acquisition process, it’s subject to discussion.
Amazon Aggregators like Thrasio, Berlin Brands Group, SellerX would love nothing more than to discuss this further with you. Feel free to submit your contact details with one of them to connect with one of their representatives.
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Whether you want to launch or scale your Amazon store, you can take your business to heights by collaborating with the right micro-influencers and setting influencer marketing campaigns the smart way.
And we’d love nothing more than helping you align your campaigns with your business goals.
