The Era of ECommerce Accelerators and Incubators Omer Riaz April 13, 2022

The Era of ECommerce Accelerators and Incubators

ecommerce accelerator business benefits

Many people will agree with the statement that “2021 was Brand Aggregators year,” and what a productive year it was. Thrasio, the leader of brand aggregators, reaches a valuation of 10 billion US dollars. Other companies have also raised billions of dollars for scaling and buying third-party brands on the Amazon platform.

How Ecommerce accelerators are generating growth by raising 600 million US dollars in 2021  and 2022 might be “The year of E-commerce Brand Accelerators.” First, it’s vital to understand the difference between Brand accelerators and Aggregators.

Aggregators invest in Amazon brands and provide constructive strategies to escalate their growth. They are purchase-focused companies.

On the other side, e-commerce accelerators are mature companies with multiple years of experience mastering leading E-commerce platforms like Amazon.

Instead of purchasing brands, accelerators form partnerships with them, sharing their confidential data, optimizing the supply chain, and discovering new revenue streams for a share of profits.

ecommerce accelerator

It’s important to acknowledge that Ecommerce accelerators and aggregators aren’t competitors. Both work with different strategies to foster growth for brands. But to understand how brand accelerators bring value to the business and why choosing them is attractive decision making, it’s fundamental to know what they do when they do things right.

Proactively filling gaps 

As small brands grow, their needs for development change over time. They may require additional staff for their product development and marketing strategies, which can be a costly and time-consuming process.

Here, Ecommerce brand accelerators will help you fill this gap by providing competent teams assisting you in tasks ranging from marketing operations to scaling Human resources. Their teams are highly proactive, and they can handle complex tasks.

They Optimize Investments 

It’s difficult for business owners to identify the key areas of investment that can generate value for their business. Most of the sellers re-invest some ratios of their profit in their business to scale it but end up with very minute growth.

Your investment strategies should be constructive for creating revenue streams. Your business will take longer to achieve desired outcomes without optimizing your investment strategies.

Ecommerce accelerators provide you with robust strategies and actions to expand your business growth. They will help you in optimizing investments to create value.

The fundamental goal is to generate the flywheel effect: preserving small wins and momentum while at the same time finding new growth areas.

They Meet Brands Where They are

Different brands operating under the ecosystem of Amazon are thriving hard to attain their firm position in the market. Small and medium-sized brands that attract aggregators and accelerators have grown organically and are under different stages of development and maturity. These businesses are working to optimize their strengths and minimize weaknesses.

Brand accelerators provide them with valuable strategies to lead them towards the right step for their business. These strategies will be beneficial for businesses to grow in the competitive business environment.

Enhancing Customer Lifetime Value 

Larger brands know the worth of customer lifetime value, and they adjust their marketing strategies to foster repeat purchases by customers. Nearly 76 percent of the companies see customer lifetime value as an important indicator for their growth.  At the same time, small brands face difficulty in handling their marketing investments.

Existing customers spend 67 percent more on average in comparison with new customers. Moreover, the probability is higher to retain existing customers than new ones. If you provide high-quality services to customers, they will become your loyal consumers. Otherwise, in the modern competitive environment within the E-commerce industry, it’s not hard for customers to switch loyalty if they witness any drawback in your services.

Ecommerce accelerators will help you tackle this problem by providing plans to retain customer lifetime value. It will increase your business’s long-term growth and ensure success in the future.

Informing Product Innovation 

Most companies around the globe try hard to foster their innovation activities to enhance their products and services. However, it’s not easy to create an innovative invention that can attract customers. According to market research, nearly 85 percent of the new products fail. So, businesses have to be creative and do a lot of research to create successful innovation.

Small brands try to grow by expanding their product portfolios, but it’s a tricky procedure to ensure effectiveness. Here, Brand accelerators will analyze the customer buying behavior and recommend the best suitable products for your brand to sustain long-term growth.

They will provide you with innovative product expansion ideas to lead your brand to future growth without unprecedented hurdles.

Upgrading Supply Chain Efficiency 

Supply chain efficiency is the backbone of any business. Without effective supply chain management, businesses can face delays in their orders that negatively impact customer satisfaction. Covid-19 has severely impacted the global supply chains due to which businesses are facing problems in dealing with orders. In the pandemic, the supply chain of different companies got severely affected all over the globe. In the USA, nearly 38.8 percent of small businesses faced delays in their supply chain.

Suppose your business encompasses an optimized supply chain. In that case, your business costs can be reduced, the efficiency rate will be high, improved cash flow, and the risk will be minimized. All these factors will make your business strong in every dimension in the long term.

E-commerce accelerators will identify areas of improvement in your supply chain management and will eliminate any existing problems to strengthen your business.

Reaching to Conclusion

Few top Ecommerce brand accelerators raised millions of dollars in 2021, showing their dominant emergence. Aforementioned that Amazon Aggregators received much importance in 2021. Still, ecommerce accelerators have done significant hard work to scale brands on Amazon and beyond.

Brand Aggregators and accelerators have different operational approaches but the same goal of sustaining brands growth. The aggregation has gained much importance; perhaps 2022 will be the era of brand acceleration.