One of the biggest challenges for Vendors on Amazon is launching a product with no sales velocity & convincing Amazon to purchase enough product orders to keep the item in stock.
Amazon’s “Born to Run” program gives Vendors the opportunity to launch products on Amazon at an accelerated rate rather than having to wait to ramp up sales and positive reviews.
This could potentially solve one of the largest problems Vendors face today: getting a new listing off the ground.
What is the Amazon Born to Run Program?
Aside from sounding like a Bruce Springsteen hit record, the Amazon Born to Run program is built to allow vendors to successfully launch products faster. Products do not need to be considered “brand new” to market.
Vendors can choose their initial 10-week inventory position (also referred to as the “Launch Buy Quantity” or LBQ) for a product launch in exchange for full return rights on all unsold products from the Launch Buy Quantity.
Initially, Amazon had a 10% ad spend requirement in place, but in February 2020 they removed it. Born to Run now recommends that vendors advertise in whatever way they believe will drive sellthrough.
How Does “Born to Run” Work?
Let’s say you’re about launch a Bluetooth speaker and you’re confident the product is going to sell well on Amazon. That’s when you’ll want to apply for “Born to Run” to jump-start the Amazon flywheel.
“There are multiple factors at play when Amazon is determining when to submit a Purchase Order. This, in turn, can lead to a slower product launch than anticipated.” Tanya Zadoorian, Marketplace Channel Analyst at Tinuiti said.
“With this program, Vendors are basically telling Amazon that they believe a particular ASIN is going to sell well and Amazon is agreeing to purchase enough inventory to keep the item in stock.”
“It’s also another way for Amazon to show that they are confident in the Vendor’s business as a whole. Especially if you are generating a lot of revenue, this is an opportunity provided by Amazon to launch your product (s) faster.”
Does Your Product Qualify for “Born to Run”?
The requirements to participate in Born to Run include:
- The vendor must be using the Amazon advertising program for at least 90 days
- The ASIN cannot be considered: a hazmat, be heavy or bulky or cost less than $5 / unit
- The total product cost of the LBQ (the unit quantity the vendor wants to launch) cannot exceed $50,000
Pros of the Amazon Born to Run Program
1. Launch ASIN Without “Out of Stock” Concerns
One of the major benefits of launching a product with the support of advertising offerings is that it ensures the ASIN will be able to ramp sales maturity as quickly as possible without having to deal with the challenges of running out of stock.
2. “Launch Buy Quantity” Might Not Be the Only PO the ASIN Receives
Another pro is that the initial LBQ is not necessarily the only PO the ASIN will receive in that first 10 week period. According to Amazon, if the ASIN receives sales traction before 10 weeks, Amazon systems will forecast/buy into the ASIN as they would normally.
Born to Run Success Story
As one of the first Vendors accepted into this program, a kitchenware retailer (whose name we will omit for confidentiality) was approached by Amazon and invited to participate in the Born to Run program in mid-June 2018.
“As most people know, it can be hard to launch a product on Amazon – but in this case, the seller was very hopeful about the Born to Run program. By participating in the program, they were able to get a “Prime Day” badge for the ASIN – and that’s not something most products would get. As you can see in the data below, overall it was a very helpful strategy.”
– Stuart Dooley, Senior Marketplace Channel Analyst at Tinuiti
“This brand put in a relatively conservative estimate and sold out within 2 weeks. It was actually more successful than they thought. This brand also ran 3 additional Born To Run promotions (after the original ASIN mentioned above) and all of those ASINs sold out in less than 2 weeks.”
Potential Con of Amazon Born to Run
While there are benefits (as proven above) to using the Born to Run program, one thing to keep in mind is that Amazon does have the right to take back all unsold inventory after the 10-week window has ended.
In the past, you could only submit to this program if you had direct contact with your Vendor Manager. Now, you can do this via Vendor Central Portal via Orders > Vendor Initiated Orders > Born to Run.
Tinuiti is currently managing Vendors who are enrolled in the program. We will keep you posted as more data & results become available.