One of the more common questions I get from indie publishers with a print book is: what is the difference between Amazon Advantage and Amazon Marketplace?
Well, few actually phrase it this way but if they knew what to call the two programs they would use these terms. Amazon has so many programs and acronyms—Associates, Advantage, Marketplace, MatchBook, KDP, FBA, AWS, ACX, etc.—it’s difficult to keep track of all the services, much less specific program features.
Advantage is a consignment arrangement; your book is part of Amazon’s inventory. When someone buys your book, they pay Amazon and Amazon ships them the order.
With Marketplace you are the retailer; you are essentially advertising your book on Amazon. When someone buys your book, Amazon holds the money for you while you ship the order to the customer. There is a professional and individual program and the table below contrasts the individual program. (Click here for a summary of the differences between Individual and Professional.)
|Costs||Amazon charges $.99 per item+15%+$1.35 (the book “variable closing fee”). They also provide a reimbursement of shipping fees according to a schedule. E.g a $10 book could net you $10.15. Don’t forget you have to pay for the shipping method the customer selected.||Advantage is an annual charge of $99 and you are paid 45% of the list price. The terms are about the same as if you were selling your book in a bookstore. You need to pay to ship books to Amazon for warehousing. (Read more about the new Advantage program.)|
|Marketing||Amazon shows your book to shoppers when they look for it.||As an Advantage member your book is marketed and recommended to readers like most other books on Amazon. E.g. Readers that bough this book also bought/viewed… This is a powerful benefit.|
|Perception||Even though you are the publisher your book will say it is available from a third part seller.||Shoppers cannot tell the difference between a book offered through the Advantage consignment program and any other book retailed by Amazon.|
|Pricing||You control your price. This can be important if you want to protect the pricing you extend to your distributors.||As the retailer Amazon is free to set the price as long as you are paid your wholesale price. This is not different than any other retailer.|
Which is best?
It really depends on your current reseller relationships and your objectives. Marketplace can give you a higher margin but it looks less professional and you have little control over your book’s listing information (you can pay for a month’s worth of Professional so you can edit it but there are no guarantees). You also don’t have the benefit of Amazon’s intra-site marketing programs. On the other hand with Advantage you lose control over pricing which can jeopardize distributor relationships. I work with one publisher that won’t even list their books on Amazon for this reason. (Instead we are trying an eBook strategy but that’s another story.)
I often point to the fact that more than 30% of all product searches on the Internet now begin at Amazon (9% for Google; Source: Internet Retailer Magazine). Book publishers can’t ignore Amazon's power to impact their business, positively or negatively.
If your business is in this situation I invite you to contact me about how I can help your business develop and implement an Amazon marketing strategy.