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Talking Shop: How to Compete Against Amazon

Chad Brooks
Chad Brooks

A Yahoo executive offers several tips on how small businesses can compete against Amazon.

On the surface, trying to compete against a behemoth like Amazon can seem like an insurmountable task for small businesses. However, the right strategy can turn this into a David vs. Goliath success story.

While Amazon has nearly 200 million visitors to its website each year, small businesses can avoid being sunk by the giant retailer by focusing their efforts on specific products and not trying to be everything to everyone, according to Dan Breeden, head of marketing partnerships for Yahoo Small Business.

Dan Breeden

Breeden is a 12-year e-commerce veteran and has been advising small businesses on how to start off on the right foot for more than a decade. Part of his advice to small businesses concerns how to stay afloat when competing against large marketplaces.

Breeden has been at Yahoo since 2006 and has led partner and marketing programs for a number of B2B and consumer initiatives. He's been with Yahoo Small Business for the past eight years, focusing on building a community of strategic partners, developers, and agencies that provide the tools and expertise small businesses need to start, build, and grow successful companies.

We recently had a chance to speak with Breeden about how small businesses can build an online business while facing competition from Amazon and other large marketplaces.

Becoming an authority in your niche

Q: What is the first thing you should do when trying to compete against Amazon?

A: Be the world's best authority on the products you want to sell. Amazon's business model is selling lots of products without offering great depth of detail. Your competitive edge is providing your customers with richness and breadth of detail, thereby becoming the trusted source of information on a product.

By creating conversations with your customers, you'll build engagement faster. Think of yourself as the store in town with the best fishing tackle or the best cooking tools. Nurture customers who really enjoy these types of purchases and how the items make their life better.

Q: How can targeting a niche market improve your chances of competing against larger competitors?

A: Big marketplace retailers sell in volume and compete largely on price. As a smaller retailer, you need to compete with more finely tuned, curated merchandise that offers customers a product and experience they won't get elsewhere. 

Targeting a niche market and spending your limited advertising dollars to reach these customers will improve sales and protect your budget. Also learn how to target ads to buyers who are getting close to purchase, as opposed to ones that are just researching options. 

Q: How should businesses trying to compete against the likes of Amazon leverage social media?

A: Social media is the perfect marketing tool for smaller retailers. Use the social media channels that fit your products and prospective customers, and use them on a consistent basis to build your community of people interested in your specific group of products.  Encourage feedback and conversation, which will also help you get ahead of trends before the mammoth retailers. 

The millennial customer, in particular, is a frequent social media user and expects to see product information available through these channels. Make your communication upbeat and engaging and you'll rise above the noise of the mega retailers. Try to add unique photos or very short videos to increase engagement and stand out from the crowd.

Doing your research

Q: How much of your attention should be focused on trying to compete with Amazon, as opposed to your other competitors?

A: Your focus needs to be on any retailer either selling or looking to sell in your product space. The way to stay in business is to have a clearly defined niche set of products, a powerful connection to your customers, a constant refresh of inventory to capture trends first, and a continual social media push to draw feedback and attract new customers. 

It sounds like a huge task, but it is the only way to be unique and interesting enough that a customer will spend the time to look around on your site and get to the cart page. That said, don't focus specifically to beat any marketplace. Focus instead on building a loyal base of customers and to turning them into advocates for your business.

Q: Before starting a business, should you spend time researching how big of a player Amazon is in that marketplace? If they are a big player, should you reconsider even starting your business?

A: Based on the enormity of Amazon, you can assume most common goods are already available via Amazon. You should certainly do an Amazon search of what is available in your planned product category, but spend a significant amount of time across the internet researching the defined niche market you want to target. 

Be sure to look at other marketplaces as well as direct-to-consumer sites to gauge the level of existing competition. Be realistic. Use all the data and information you find. If it appears your market is still largely untapped, launch your site.

Q: What are some key signs that Amazon has you beat and you need to consider a new strategy?

A: If you find that Amazon has essentially duplicated your product catalog and the items you sell are neither complex nor personal in terms of fit or function, you're probably in trouble.

Even if you currently have a slight pricing advantage or a loyal following, it's going to become increasingly difficult to grow your business. When you see this, it may be time to consider options that include pivoting to products that benefit from your own expertise and recommendations, or even looking at manufacturing your own line so you have a defensible set of products.

Rapid-fire questions

Q: What piece of technology could you not live without?

A: Hey Siri. I spend more than 500 hours a year commuting – half of that on a motorcycle. Having a hands-free tool – whether it's in my car or using a Bluetooth connection to the speakers and mic in my motorcycle helmet that lets me stay on top of my schedule, traffic reports, directions around accidents, or just streaming music – has made my commute about as close to enjoyable and productive as I’m likely to get.

Q: What is the best piece of career advice you have ever been given?

A: I once had a boss who advised, "Don't let anyone assign you to stupid projects." Those are words I’ve lived by. It seems that no matter what your level, once people see that you can get things done, they will come up with more ideas for how you can fill your time.

If it’s something small, you may want to just get it done and write it off to managing up or building goodwill. But all too often you end up being the go-to person for vanity projects with little value.

Don’t fall into that trap. Develop your reputation as a professional focused solely on high-value, big projects. You can then push back on assignments that don't align with your goals or are merely unproductive time-wasters.

Q: What's the best book or blog you've read recently?

A: I've been reading Wisdom @ Work: The Making of a Modern Elder by Chip Conley and am finding it to be an inspiring take on how different generations of workers can contribute to a company's success while also continuing to learn and grow.

The author is the founder and former head of Joie de Vivre Hospitality who, at the age of 52, joined Airbnb as head of global hospitality and strategy. Initially feeling digitally underwater compared to other workers, he quickly found that his experience enabled him to provide incredible value as a mentor and "elder" who could see the big picture.

Beyond being a roadmap for midlife professionals, I'm finding it provides some valuable insights into creating diverse teams and helping everyone do their best work. 

Q: What's the biggest risk you've taken professionally? Did it pay off? 

A: Probably the biggest risk I ever took was accepting a promising job that required a 4,000-mile move and where I didn't have the opportunity first to meet the team or top managers. The role sounded challenging and promised entry into a top media brand, but it only took a couple of months to realize the company’s negative culture was tough to counteract and turnover was quite high. 

With a newborn child at home, I struggled with whether a horrible job was better than no job at all. I chose to invest in my own sanity and belief that my time and opinions had value.  I quit. It was a decision I've never regretted and set up a chain of new roles that quickly outstripped any opportunity the previous job offered. It taught me that I can overcome setbacks and that being true to your core principles has more value than a temporary sense of security.

Image Credit: Andrey_Popov/Shutterstock
Chad Brooks
Chad Brooks Staff
Chad Brooks is a writer and editor with more than 20 years of media of experience. He has been with Business News Daily and for the past decade, having written and edited content focused specifically on small businesses and entrepreneurship. Chad spearheads coverage of small business communication services, including business phone systems, video conferencing services and conference call solutions. His work has appeared on The Huffington Post,,, Live Science, IT Tech News Daily, Tech News Daily, Security News Daily and Laptop Mag. Chad's first book, How to Start a Home-Based App Development Business, was published in 2014.