What Amazon can - and can not - do for your business

Or: why separating platform leverage from business blind spots is key to profitable growth.

A common question I hear from brands is: “What (else) should we be doing on Amazon right now to get results we want?"

It’s a logical question, at times wrapped around a deeper anxiety — sales aren’t where they want them to be, sales are not growing as fast as wanted, margins feel squeezed, or pressure from leadership is mounting. Sometimes there’s a sense that there MUST be some Amazon lever they’re just not pulling hard enough. But more often than not, what I think the real question is:

 “Is this really a channel issue, or a business issue — and what’s within our control to change or adapt to for better results?”

That’s where clarity begins.

Because Amazon can do a lot. But it can’t do everything. And if you confuse one for the other, you end up solving the wrong problem — or wasting effort trying to fix a structural issue with a channel tweak.

Here are some thoughts to help make that distinction in practice.

What Amazon Can Do

Amazon works best when it’s understood as a high-intent demand engine with built-in powerful infrastructure. When paired with clear strategy and strong fundamentals, it can drive measurable growth.

From my experience, here’s what Amazon reliably delivers:

1. Massive Demand Access

Amazon is where search and purchase converge. In the US 50% of all online product searches start on Amazon. For many categories, it’s where consumers go to decide. That visibility — especially for search-driven or replenishable CPG products — is truly unmatched. A well-optimized product can punch above its weight fast, without needing shelf resets or buyer meetings.

2. Operational scale without owning operations

FBA is still the most turnkey way to get 2-day delivery to 90% of the country. For small and mid-size brands it’s a national distribution network without owning fulfillment headaches. In some ways Amazon lets you act bigger than you are. Amazon FBA is not not free (nor cheap anymore), but it’s effective.

3. Accelerated trial and consumer feedback

If you're launching a new product, or even flavor, or pack size, Amazon lets you test with real buyers at speed. Want to know what your customer really thinks about your formula, packaging, price point, product effectiveness, etc.? You’ll find out very quickly. Reviews can give more insight than some $30K consumer panels. If you read between the lines, you’ll find what resonates (and what doesn’t) faster than most market research firms could ever tell you. And by the way, you can do the same with your competition reviews on Amazon.

4. Channel diversification and defense

For brands still heavily dependent on brick-and-mortar or wholesale, Amazon offers not just incremental revenue but insulation, and internal ‘know how’ development of how ecommerce works. If a retailer drops you or a foodservice customer cuts volume, a healthy Amazon channel is a hedge. It also protects against grey market chaos — if you don’t show up on Amazon, someone else will do it for you, and most likely poorly.

5. Marketing signal amplifier

When Amazon is working, it creates a flywheel: strong content + great visuals + reviews + sales = more visibility. Which then drives more discovery, more sales, more reviews. In some cases, success on Amazon also lifts search volume on Google or in-store velocities, or even open more retail doors. Done right, Amazon becomes a signal amplifier across the rest of your commercial activity.

What Amazon Can’t Do

And yet, I’ve also seen Amazon magnify problems, when a good question to ask is: is this a business problem showing up on Amazon, or it’s truly an Amazon problem for our brand?

To answer that question, here are some thoughts on what Amazon won’t do for your brand:

1. Fix broken unit economics

If your gross margins are thin Amazon will expose it fast. Between FBA, ad spend, and fees, your contribution margin on Amazon can vanish unless your product is priced — and costed — for ecommerce realities. Gross margin below 65-70% is rarely sustainable. Strategy won’t help because it is math.

2. Enforce price discipline or channel harmony

Amazon does not enforce MAP. In fact it discourages it by wanting to be the lowest price platform for customers for any product. It rewards the lowest price, not the cleanest distribution. If you have resellers on the channel and no SKU segmentation, Amazon’s pricing will reflect that chaos. Your retail partners will see it. Your margins will feel it. And brand may suffer from the perception of inconsistency. Ultimately there needs to be internal ownership of Amazon, and a mindset of brand control on Amazon is a brand’s, not Amazon’s, responsibility. It does not feel fair, but that is the reality.

3. Tell your brand story for you

Amazon is a transactional platform optimized for quick decisions. It’s really not built for rich brand storytelling, emotional connection, or lifestyle content continuity. Nobody follows brands on Amazon the same way they follow channels on Youtube, Instagram, TikTok. Good news: high intent to buy. Bad news: you can win customers here, but you won’t build deep brand equity on transactional volume. If your growth depends on rich storytelling, community, or emotion — Amazon won’t carry that weight for you. Social, PR, experiential, DTC are better for that. BUT, when you do that well outside Amazon becomes a great transactional ‘meet customers where they are at’ place to get sales.

4. Build customer loyalty

Amazon owns Amazon customer data. Amazon sellers don’t get customer email, you won’t build a community, and you won’t have control over the post-purchase experience (other than a request for review, or a cart abandon ping). Some loyalty can be built through Subscribe and Save, but it does rely on continue to deliver great product, and occasional enticing with a promotion. But in the end loyalty will be to Prime, not to you.

5. Fix internal organizational issues

Many of the headaches brands have on Amazon are a reflection of internal misalignments. Marketing wants investment in brand discovery, CFO wants green P&L, operations wants more time for supply chain or manufacturing delivery. These internal tensions are normal because each function has their responsibility. BUT, that’s where leadership and internal ownership of Amazon comes in. Especially when working with an external Amazon agency or an expert. There has be an equal presentation of ownership on both sides to get results.

So What’s the Takeaway?

Amazon is not business’ savior. It’s also an enemy. It’s a complex, powerful platform that I believe every CPG brand in North America has to be on.

The brands that win on Amazon don’t just treat it as a sales channel. I believe that treating Amazon as a strategic function: a testing ground, a growth lever, an early-warning system, is to make the most out of it. Of course investing where it counts — content, pricing strategy, fulfillment discipline. But also not expecting Amazon to compensate for holes in your business.

Saludos,

Irina