Adcorp Solutions

The Benefits of Advertising:

In today’s competitive market, advertising is essential for any agency looking to stand out and thrive. Here’s why advertising can be a game-changer for your agency:
1. Increased Brand Visibility
Advertising helps your agency reach a wider audience, making your brand more visible to potential clients who may not have otherwise discovered you. This is key to expanding your client base and building a recognizable presence.
2. Targeted Reach
With digital advertising, you can target specific demographics, industries, or interests, ensuring your message reaches the right people at the right time. This precision improves the quality of your leads and increases the likelihood of conversions.
3. Building Trust & Credibility
Consistent advertising can position your agency as an industry leader. When potential clients see your ads regularly, it builds credibility and trust, making them more likely to consider your services.
4. Boosted Traffic & Engagement
Ads drive more traffic to your website and social media profiles, creating more opportunities for engagement. This increased activity can lead to more inquiries, higher conversion rates, and greater client retention.
5. Measurable Results
One of the best aspects of advertising is the ability to track and measure your results. With tools like Google Analytics and social media insights, you can see what’s working, refine your strategy, and ensure that your ad spend delivers the best ROI.
6. Competitive Advantage
Staying top-of-mind through advertising gives your agency a competitive edge. Even in a saturated market, regular ads can help differentiate your services and showcase what makes your agency unique.
7. Scalable Growth
Advertising allows your agency to scale efficiently. As your budget increases, so can your reach. Whether you’re focusing on local markets or expanding nationally, advertising provides the flexibility to grow at your own pace.

In conclusion, advertising isn’t just about promoting services—it’s about building relationships, driving growth, and positioning your agency for long-term success. Ready to take your agency to the next level? Start advertising today!

Amazon Takes a 50% Cut of Seller's Revenue.

Amazon is pocketing more than 50% of sellers’ revenue - up from 40% five years ago. Sellers are paying more because Amazon has increased fulfillment fees and made spending on advertising unavoidable.
According to P&Ls provided by a sample of sellers, a typical Amazon seller pays a 15% transaction fee (Amazon calls it a referral fee), 20-35% in Fulfillment by Amazon fees (including storage and other fees), and up to 15% for advertising and promotions on Amazon. The total fees vary depending on the category, product price, size, weight, and the seller’s business model.

The 15% transaction fee has stayed the same for over a decade. It varies by category and can be as low as 8%. Fulfillment by Amazon (FBA) fees have steadily increased. Amazon has raised fulfillment fees every year and introduced increases in storage fees. Selling on Amazon is tied to using FBA, so it’s rare for sellers to be successful without using it.

Amazon doesn’t set advertising prices, but as more sellers choose to advertise, advertising gets more expensive due to competition. Advertising on Amazon is not optional. Most of the best-converting screen space is allocated to advertising; thus, sellers inevitably have to advertise to have a chance to be discovered. Some sellers still pay very little for advertising, and many resellers spend less than 5% of sales on it, but private label sellers often spend more than 10% on growing their brands.

Every year, Amazon sellers pay more fees as a percentage of their sales. The increase is not a result of sellers using more services. The same services have gotten more expensive (FBA) or unavoidable (advertising).
The fees pay for services that wouldn’t be free elsewhere either. Advertising on Google and Facebook - two major consumer acquisition channels - has also gotten more expensive, and fulfillment services by 3PLs are not always cheaper than FBA. Amazon fees pay for a lot of value; whether they are too costly or have risen too fast is subjective. But both Amazon advertising and FBA are not optional services - 50% is the cost of selling on Amazon, and the various services that the 50% pays for are required.

That bundle is hard to directly compare against marketplaces like Walmart and eBay or shopping platforms like Shopify. Walmart, for example, is cheaper than Amazon, especially for new sellers for which it offers transaction fee discounts. But it’s also an order of magnitude smaller than Amazon; a seller can only partially replace Amazon with Walmart. And direct-to-consumer e-commerce through platforms like Shopify is a fundamentally different business model - the fees are not the only consideration.

Sellers are combating fee increases by either raising prices, diversifying from FBA, or diversifying from Amazon altogether. However, sometimes it’s only at the end of the tax year that they realize how little net profit they have left. A few sellers showed paying 60% and even 70% of their revenue to Amazon in fees. They still had to pay for inventory, freight, employees, and other expenses.