Cross-border sales burn hundreds of millions of advertising fees a year! Amazon front-end bug leads to duplicate orders?

As one of the veteran 3C sellers, UGREEN is more well-known in China than Anker. In many product lines, it directly competes with Anker, the current top Amazon seller. In terms of 3C products such as data cables, chargers, and power banks, the two companies are of comparable size and are both leading players in the electronics category.

Moreover, in 2022, Amazon became the platform with the largest share of UGREEN sales, almost as large as Tmall and JD.com in China combined.

In terms of Amazon's platform advertising strategy, UGREEN Technology mainly adopts CPC advertising, DSP advertising and other models. And it mainly focuses on in-site advertising, and spends very little on off-site promotion. In 2020 and 2021, UGREEN Technology's investment in Amazon advertising reached 102 million yuan and 130 million yuan. In the first half of 2022, the investment in in-site advertising also reached 69.35 million yuan, which does not include the Black Friday and Cyber ​​Monday peak season in the second half of the year. The annual investment will definitely exceed 100 million.

The return on such high advertising investment is also considerable. According to the information disclosed in the prospectus, UGREEN Technology's revenue in 2019, 2020, and 2021 was 2.045 billion yuan, 2.738 billion yuan, and 3.446 billion yuan respectively; net profits were 227 million yuan, 306 million yuan, and 305 million yuan respectively; revenue in the first nine months of 2022 was 2.742 billion yuan, an increase of 13.14% over the same period last year ; net profit was 222 million yuan, an increase of 11.29% year-on-year. Given the sluggish overall environment of cross-border e-commerce last year, it is very impressive that UGREEN was able to achieve such results.

Last year, there were quite a few products that broke through the siege in the red ocean category and sold well.

Changrun originally supplied automobile manufacturers as its main channel, but later began to build its own brand and layout cross-border e-commerce. Now it has become the BSR of multiple auto parts product subcategories on e-commerce platforms such as Amazon and Walmart, and has a certain share in large supermarkets such as Costco. Moreover, after building its own brand, Changrun's profit margin has obviously increased significantly . In the above figure, you can see that while revenue has obviously declined, with a drop of up to 7.83%, net profit has increased by 30% instead of decreasing . This is a benchmark case of factory transformation into a cross-border seller.

The two big sellers we looked at today are both masters of branding. We small sellers should also start to slowly develop our own branding routes from now on . In-site advertising is a very effective way to promote your own brand. Although we cannot spend 100 million on advertising every year like UGREEN, small investments can also pay off .