Is Amazon the key to investment success?
The Difficulty Purpose-Led Brands Face
Purpose-led brands entering a busy market are left with the tall task of building brand awareness and converting customers. Growing your brand organically will always be the optimum route, but it’s a much slower process and doesn’t guarantee success.
Making an impact requires an effective marketing strategy. And as your brand grows, these plans will likely become more costly as do your operations. Securing investment ensures that your business can advance and investigate more ways to operate as sustainably as possible.
However, securing investments is never a simple process, but the more compelling your brand story and growth are, the better. As discussed in our last blog, opportunities for purpose-led brands are flourishing as investors are taking a keen interest in purpose-driven investments. So, clearly articulating your businesses’ ESG commitments will be a crucial part of your fundraising pitch.
While your sustainability commitments are important to present, investors will also be looking to understand how viable your business is. Have consumers responded well to your product or service? What evidence do you have to prove this success?
The Amazon Effect
Consumer brands that have successfully fundraised on platforms like Seedrs[i], have included their Amazon data within their pitch deck. Amazon is highlighted as part of its e-commerce portfolio along with product ratings to validate customer satisfaction.
Selling on Amazon can help investors understand what your prospects for expanding internationally could look like. Amazon is a global platform, so a strong presence in the marketplace can satisfy any discussion of expanding outside of the UK.
Amazon is an e-commerce giant so investors have taken a key interest in brands that do well on the platform. Their intention is often to expand their digital portfolio with businesses that are easily scalable. In 2020, we saw the explosion of aggregators taking to Amazon to purchase small businesses that are growing rapidly. [ii] This is because acquiring these types of businesses is incredibly cost-efficient. For example, the marketing costs can be considerably cheaper. The cost of acquiring a customer through Google Ads is significantly higher than the cost of acquisition on Amazon.
How has this impacted the purpose-led brands we support?
A brand we support, Bonraw, spoke to us about the effect growth on Amazon has had on their fundraising efforts. “You can gain a lot of insights from Amazon now, where historically it was quite difficult to get a hold of. That’s important too as you can see where the growth is in the category, and that’s great for when you’re having conversations with retailers or investors. Our customer reviews were really important too, and those insights are really important to customers, retailers, and investors as well. Seeing that who’s buying it actually appreciates what’s being done there.”
Success on Amazon isn’t the sole key to securing investment as a purpose-led brand, but it can act as strong evidence of demand for your products. It’s also a great place to collate honest and compelling reviews. A 5-star rating on a listing is a valuable mark of consumer trust.
Do you want to find out what the opportunities are for your brand on Amazon? Book an introductory call with us here.
[i] How To Create & Present A Great Investment Pitch Deck | Seedrs
[ii] Legacy Lost: Why Amazon FBA Brands Are More Attractive Acquisition Targets (forbes.com)
