As retailers increasingly build businesses on Amazon, ad-tech firms that handle everything from managing their inventory to advertising are cashing in.
Five-year-old Sellics has raised $10 million in Series A funding from UK-based venture capital firm Frog Capital. Sellics sells software that helps retailers and consumer-packaged-goods brands like Lego and Unilever manage their business, including tracking profit margins, inventory and customer reviews. Sellics also uses machine learning to manage the bids and keywords that sellers use to run ad campaigns on Amazon.
As an example, for home furnishings company Noble House Furniture, Sellics helps it run ad campaigns and keep tabs on reviews and inventory. Chris Wagner, head of e-commerce at Noble House Furniture, said the company wants to double its Amazon sales this year. Noble House Furniture also sells products on Wayfair and Overstock.
"In our category of furniture, they've been putting a focus on growing, which has benefitted us," Wagner said. "Strategically, Amazon is equal to any other channel, and it wasn't in years past. We see it percentage-wise as our biggest growth over the next couple of years."
Sellics wants to help big agencies get a grasp on Amazon
Sellics CEO Franz Jordan said that part of the new funding would go towards creating products for a new crop of Amazon-focused agencies founded by ex-Amazon employees and agency holding companies that are building practices dedicated to Amazon.
Jordan said he expects to have between 120 to 150 employees by the beginning of next year, from 100 today. One area of growth is an account management team he's building to work with big agencies and brands.
Jordan said that the holding companies are trying to make inroads with brands that sell on Amazon, TBIT hey struggle with the non-advertising aspects of Amazon.
"The reality is that all of the different parts of a business on Amazon are interconnected," Jordan said. "This new model needs to be orchestrated and coordinated from one team instead of being split up into different teams."
He added that Sellics does not want to compete with larger services that agencies offer but instead help brands launch products and target big shopping days like Prime Day.
Amazon is testing lots of different ad formats
To appeal to big brands that care about metrics like brand awareness and loyalty, Amazon has rolled out ad formats and features like video ads and Stores, custom landing pages on Amazon that marketers use to merchandise their products.
Amazon's teams often work on similar and competing tools for advertisers. Jordan said that the increasing number of ad formats can be confusing for advertisers but argued that Amazon's platform is not getting overcrowded for advertisers.
"The ultimate goal for advertisers is to know all of the steps that someone did before purchasing a product to [understand] lifetime value and the cost of acquisition," Jordan said. "It's getting more complex, but there's plenty of room for brands to expose themselves."