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By Jason Landro · March 17, 2025 · Curated by George's Blog
You shouldn’t be forced to sacrifice on the quality of your tech and analytics stack when you work with an agency for Amazon ads or account management Yet brands almost always have to make that sacrifice, but there’s a reason…Specifically, quality software is important because brands need to know how to forecast demand, measure profit and loss, track ad and sales performance against contribution margin on a daily basis, measure relative market share, monitor PDPs, and so much moreOn the other hand, brands need to develop a strategic plan to grow market share and then execute on it surgically through different organic and paid strategies while iterating along the wayThat requires quality management (software can’t do that…yet and probably for a long time)The reason brands have had to compromise on quality on either software or services is that software is expensive to build and software companies trade at higher multiples than managed services companiesTherefore, when software companies provide managed services as a means of adoption of their software, they do their best to minimize the overhead associated with the managed servicesThat’s because the managed services are way less profitable than the softwareIn other words, the software companies don’t want managed services to drag down their overall profitability because it will hurt the P&L and the valuation on an exitSo they essentially cheap out on managed services, to put it simplyThat manifests in the lack of experience of personnel, too large of a workload per person, lack of development in agency systems and process, etc.On the flip side, agencies typically don’t have the margin to build software without substantial outside investmentBut investors don’t want to invest in an agency building tech until the agency has real scale because it’s not a good investmentIt’s a bad investment on paper because agencies don’t have the same margin as a pure software company so the anticipated return is lower from day 1For a long time, we were frustrated that we couldn’t provide quality software to our client partners We recognized that there was a gap in the marketWhich is why we acquired iDeriveBrands no longer have to compromise on quality for either managed services or software when it comes to AmazonThis space has evolved rapidly in the past 5-7 yearsIf you want to succeed (whether you’re a service provider or brand), you have to stay ahead of the curveThat’s what we’re doing at Nectar, and I couldn’t be more excited about ithashtag#amazonsellers hashtag#amazonvendor hashtag#amazonadvertising