EPISODE 50! We wanted to make something SPECIAL for our 50th official episode of Follow The Data. All of this episode was created as such a huge ‘thank you’ to all of our listeners. We brought Casey back on to touch on where Viral Launch is now, where we’re headed in the future, and what to expect from the Amazon Seller Space currently and in the future. Who knows, if you listen in, you might even get insight into what Viral Launch is releasing next 😉
The goal of this series is to talk through high-level Seller Strategies from Amazon Sellers who are killing it in the CURRENT Selling Game. We’re talking through what they’re doing to scale their business: What’s currently working, what’s NOT working, where underpriced attention is, where you should be investing your time, and where Amazon is headed in general.
In today’s episode, I’m talking with Tom Wang, a Seller of his own who’s been implementing a lot of high-level strategy and is VERY in-tune with what other sellers are going through. Part of what we talk about in this episode involves developing a healthy entrepreneurial / Amazon-oriented mindset. Let’s dive in.
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The Amazon Space is FULL of information. The entire Seller Ecosystem is extremely unique, full of perspective, experience, data, competition, and everything in-between. Our goal is to simply put out TRUTH – facts, advice, and information backed by data. When we see Sellers walking down a path that leads to failure, we try to step in, and point people back on the right track. And that’s what we’re doing today. We’re breaking down what two HUGE mistakes Sellers are making when it comes to Product Research, and how to research markets correctly.
Today, we’re breaking down two huge Amazon product research mistakes.
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It’s easy to get stuck in ruts as an Amazon Seller. When trying to do everything alone, not only do you feel like you don’t have anyone that can relate to what you’re going through, but you don’t have anyone to bounce ideas off of. Without others to process with, ideas stagnate, sales slow, and your full potential can’t be reached. We’re changing that with this Series. This episode is the start of a periodic series we’re starting to pull out Seller Strategies from Amazon Sellers who are killing it in the CURRENT Selling Game. We’re talking through what they’re doing to scale their business: What’s currently working, what’s NOT working, where underpriced attention is, where you should be investing your time, and where Amazon is headed in general.
In today’s episode, I’m talking with Liran, a Seller who’s been in the game for a LONG time, and has successfully established himself as an Amazon Entrepreneur. There is a LOT of practical knowledge and strategy you’ll be walking away with. No Seller should feel like they’re alone in the process of Amazon. The goal of this is to mitigate that feeling of loneliness or stagnation. Let’s get started.
Keyword Matter. YOU matter. How you USE a keyword MATTERS. Placement, frequency, plurals, hyphens – there are so many intricacies to keywords and listing optimizations on Amazon, and it’s INCREDIBLY important to get them all right. Getting it right means you’ve checked that box off your list – that you can now focus on improving and implementing changes across other mediums. Getting it wrong means you’ll be fighting an uphill battle until it DOES get fixed. In this episode, we’re breaking down 5, updated, data-driven, data-based simple tips to improve your listing optimizations. These are insights that you can take, and instantly go and implement. We’ve seen conversions increase from following these. So listen in, take notes, and take action. Let’s get started.
We ALL make mistakes on Amazon, and like we’ve talked about in previous episodes of Follow The Data, all have experienced failure in one way or another. Learning from our failures, and learning from our own and other’s mistakes can lead us deeper into our own path of success! In this episode, we’re going to break down 12 of the MOST common mistakes we see sellers making on Amazon. We’ve talked about failures in the past, and while that still applies to mistakes, these are a bit different. Let’s jump in.
Casey’s had the opportunity to travel, speak, observe and implement some of the highest-level Seller strategies for Amazon. He’s seen just about everything in the Amazon space, and plays an active part in molding what selling looks like for everyone involved in this space. In this episode, we’re playing back a presentation Casey had at a conference called ASGTG. During this presentation, now released in this podcast episode, Casey breaks down what a successful seller mindset looks like, what it means to select ‘winning’ products to sell, and how you as a seller can dominate search results with that winning product. There’s a LOT of great info. waiting for you on today’s episode of Follow The Data!
PRIME DAY 2018 – The longest Prime Day in history – More Time, More deals, and more sales. Prime Day is BACK and is expected to be bigger than ever. With a Subscriber base of more than 100 million Prime Users globally, you can expect big things this year. Cameron’s going to break down data resulting from last year’s Prime Day, which can lead us into what to expect for this year’s 2018 Prime Day. Let’s dive into the data, and dive into how you can best prepare for 2018.
You should really be kind of focusing on how can you take advantage of the moment. Really, Prime Day is one of those levers, one of those easy levers that you as a seller can pull to increase your sales.
Prime Day 2018, the longest Prime Day in history. More time, more deals and more sales. Prime Day is back and is expected to be bigger than ever. With a subscriber base of more than 100 million Prime users globally, you can expect big things this year. I’m Cameron Yoder, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 30,000 product launches and our experience working with more than 8,000 brands to help you understand the big picture when it comes to Amazon and the best practices for success as an Amazon seller.
In this episode we’re going to walk through what you can expect for Prime Day this year. We aggregated a lot of data from last year’s Prime Day. We’ll run through what the data is pointing to this year and how you can best prepare for what is to come on the 16th of July. Let’s jump in.
What’s up, everybody? Cameron here. Today, like I said in the intro, we’re talking through Prime Day 2018. Now Prime Day 2018 is going to be, or it’s expected to be just a huge day, huge sales day. Now not too long ago there was somewhat of a leak of the Prime Day date that was on the Amazon UK website. I believe it was TechRadar that caught the unexpected date for everything going on, and the date on that banner was July 16th. Now since then Amazon has actually same day has released, kind of put out official information regarding Prime Day, so most people are awake of the day now, which is July 16th starting at 3:00 p.m. And this does make Prime Day, I believe, the longest Prime Day to date so far.
So Prime Day is – Prime Day is a big deal. Why is it a big deal? A lot of people ask why is Prime Day so hype? Why do people get so hype for Prime Day? Now Prime Day as a whole does not guarantee that you as a seller are going to make more money. That’s not the guarantee. That’s not why people hype it up, even though that’s why a lot of people think, honestly. Really, statistics point to increased sales across the board on Prime Day, just for Amazon and for people selling on Amazon in general. So what can you expect? Well, you can expect more people to be shopping on this day. So if more people are shopping across just about every single category, being on Page 1 means that you’re putting yourself in front of all of those extra shoppers. So why should you care as a seller about Prime Day? Well, simply because more people are shopping on Prime Day, and if your goal is to simply make money, or if your goal is to make money with selling on Amazon, which I assume that is at least one big part of your business, then Prime Day should be important to you.
So let’s talk about Prime Day last year. Let’s talk about Prime Day 2017 because we aggregated a lot of stats from 2017, and we have some stats here just on Prime Day 2017 in general, which we can use to predict how big the Prime Day 2018 will be, at least this year. So let’s go over some statistics, some data that we have. Prime Day had more new Prime members join than any other day in history. That’s big. If you’re watching our content, we’re kind of keeping an eye on Amazon’s growth strategy. But one of those honestly is to just get more people to simply join the Prime platform, like with their expansion into Twitch and a lot of different things, a lot of different Prime benefits like Prime Wardrobe. They’re incentivizing people to join onto Prime or to jump on the Prime train. And more Prime users really does mean more shoppers for you as a seller, which is important. So more Prime members equals more shoppers, more potential shoppers I should say.
So Prime Day 2017 was the largest single sales day in Amazon history until 2017’s Cyber Monday, which was not too far after Prime Day, but it was their biggest sales day until Cyber Monday. For Prime Day 2017 we actually set up interactive graphics, or graphs, graphics, graphs to compare Prime Day sales to a 30-day baseline average. Having this, having these interactive graphs and graphics really allowed sellers to keep an eye on sales trends for all categories, combined along with a lot of individual categories as well.
So our largest – this was last year, again 2017 – our largest tracked seller saw a 6,000% increase in sales through this 30-hour window, basically this Prime Day window that we were tracking. So again, that was the largest. But just imagine, that kind of goes to show just the fact that more people are shopping on Prime Day, like a 6,000 increase in this 30-hour window is just literally insane. This 6,000% increase was measured across a sales baseline from the two weeks leading up to Prime Day. So we took an average of the same 30-hour period of time two weeks earlier in order to compare sales on Prime Day, and this baseline gave us a feel for exactly how big the sales influx really was. With all of our drive data we estimated that there was a 252% sales increase on Prime Day across all of Amazon compared to, again, those baseline sales across all categories.
So breaking down specific subcategories, specific categories and sales increases, the office category saw an increase by a huge 647.26%, electronics 412%, and kitchen and dining 400%. So a lot of this, again, this does not mean that your sales are going to increase by 6,000% or 600%. No, not at all. All of this however simply does point to the fact that there are a lot, a lot, a lot of shoppers coming onto the Amazon platform on Prime Day. So really you should be conc– not concerned, but you should really be kind of focusing on how can you take advantage of the moment. Really, Prime Day is one of those levers, one of those easy levers that you as a seller can pull to increase your sales.
At the same time you don’t want to run out of stock, so you want to make sure that you have inventory in place if you’re going to be competitive on Prime Day. But also, you should be setting your expectations in kind of a realistic way. So again, I would say that a realistic expectation would not be to expect an increase in 6,000%, a 6,000% increase in sales for your products across the board. No, not necessarily. But I would however expect more sales to come through on Prime Day. And so really this episode is kind of going over those statistics and pointing to what we can expect from Prime Day this year. And assuming, well, knowing that Prime, the Prime user base has grown and that Amazon of course just wants to make a lot of money, which, well, don’t just want to do that – they want long-term customers – but knowing that Prime Day is geared towards making a lot of sales, making a lot of money all at one time, we can assume that Prime Day is going to be even bigger this year.
And so we’re tracking – again, we’re tracking Prime Day this year to see kind of the percentage, the average percentage in sales increase across the board. And so expect us to kind of follow up with some statistics here. But what should you do? What should you do to prepare for Prime Day 2018? Well, really, by the time this is out you really should have your game plan at least started for what you want to do, but I guess you should ask yourself how much you have to put into optimizing everything for Prime Day. Like if capturing these extra sales are going to put you in a tough spot financially, or maybe even inventory-wise, maybe reconsider. At least consider those as factors going into this. You don’t want to just blindly start competing for a spot on Prime Day because it’s also going to be pretty competitive, or somewhat competitive depending on your product and depending on your category.
So what should you do to, or what can you do about Prime Day? What can you do to try your best to capture these extra sales that will be coming and these extra customers that will be coming in on Prime Day? Well, there are a couple things that you can and should do. One of those is optimize, get ready to optimize your PPC. So we always talk about being aggressive. Prime Day is really one of those things where being aggressive with your PPC makes sense, to put you in front of those buyers, those shoppers. So I would say maybe optimize or put in a bit more into your PPC budget than maybe you usually do because, again, if you’re putting more in your budget you’re spending more on budgetary things like PPC, but you’re gaining more sales as kind of an end result, then that is a win scenario.
So I would say run aggressive PPC. I would also say to optimize your listing and your photos. Again, maybe double check your keywords that are in your listing. Double check to make sure that your photos are up-to-date, are competitive because, I mean simply put, if you are competing for a spot on Page 1 on Prime Day and your photos are awful, like we always talk about, then you have a lower chance of converting. So really make sure that your keywords are optimized. Update your keywords because keywords, again, keywords should be one of those things that you’re kind of double checking every now and then to really make sure that you have the most up-to-date keyword information and the most up-to-date searches, search information on or for your product just because you, honestly you as a seller cannot control what sellers are searching for or how they’re searching. And so making sure to update your listing, making sure to update your photos is huge. Even if your conversion rate is something like 1% higher on Prime Day because of photos or a listing that you changed up, that 1% conversion rate paired with something like an average of 252% increase in sales across the board is huge. It really does make a difference. So optimize your listing. Optimize your photos.
Lastly, we talked about this – I believe we talked about this last year, but also making sure to plan a launch, something like seven days ahead of time is huge. So really getting on Page 1 – Prime Day is great because I mean there is, again, a general increase across the board, but even better if you’re on Page 1 for your primary keywords. So really our advice for now, right now, is to plan a launch something like seven days ahead of Prime Day to make sure that you’re on Page 1 before Prime Day hits because honestly once Prime Day hits that’s going to be that huge spike in sales, and you’re not going to want to run something like a launch to compete with a category or a market that is just running a ton of traffic.
And so what should you do as a seller that wants to run a launch? Well, really before Prime Day if you’re serious about getting onto Page 1 for, again, your primary keywords, if you are serious about that run a launch seven days before Prime Day. And maybe even honestly 10 days before. I would say 7 to 10 days before Prime Day. So that would be July 6th through something like the 8th or the 9th you should plan on already starting. That’s when you should start, be starting something like a launch or a promotion to get you to Page 1 because, again, why is Prime Day a huge deal? Well, Prime Day is a huge Dale because just more sales in general. If there are more sales, if you have the potential to capture more sales, if you’re capable of getting there, getting to Page 1, then honestly I would say you should take that opportunity.
But also there are going to be some pretty good deals, or supposedly some pretty good deals on Prime Day 2018. So if you’re in the market for buying, if you’re in that market for buying products, then Prime Day is going to be that day, I guess. So they have some good – they’re going to have some good deals on Alexa Echo, the Show, the Spot and Dot devices, Kindles, things like that. So if you’re in the market to buy certain things, definitely check Prime Day out. But also, really in the end ask yourself whether you want to or are capable of capturing those extra sales right now and prepare for just kind of an extra bump in sales. Again, it’s not like a life-changing day or moment for a lot of sellers, but for some, some sellers are going to see that 6,000% increase in sales, and you never know whether that seller could be you or not. So at least, at the very least, you want to position yourself to be that person just in case it is you.
And that’s all we had for today. We just wanted to put out a quick piece of content talking about Prime Day, making sure that you all are prepared. If you want to look over kind of more data we actually have a sales tracker on our website. I’m going to put a link to that in the description. But it would be awesome – it’s actually really cool to check out a kind of keep an eye on sales across the board for specific categories and subcategories. But check that out.
Also, subscribe to the podcast if you really do find value from it. We love, we love, love, love hearing from you as well. So go to our Facebook page right now, look up Viral Launch, direct message us any questions or thoughts you have on the podcast. We love hearing from you. So go do that. If you like what you hear, or even if you don’t, leave an honest review on iTunes. We love, again, hearing just your feedback and what you do or do not like. So leave a review for us.
Also, keep an eye out for more content. We’ll be back next week with more things. The next big thing that’s going to happen for a lot of sellers is July 4th. Actually by the time you’re listening to this July 4th will be over. But I’m hoping that you all had a great time, whether you were taking a break from work, or working, regardless, I hope you had a great time. I hope you were able to celebrate in some way. Thank you all again so much for listening. Remember, the data is out there.
Amazon is a cash game. Sellers often enter into the Amazon space knowing this, but don’t fully recognize just how much truth is in the notion that a LARGE part of Selling is optimizing where you’re funneling all of your cash. You need to ask yourself the RIGHT questions as you begin considering expanding your business with a cash infusion. There are a lot of different options sellers have used to get an influx of cash, and we’re going to break that down today. What each of them are, the risks associated with these methods, the right questions to ask, and everything in-between.
Amazon is a cash game. Sellers often enter into the Amazon space knowing this but don’t fully recognize just how much truth is in the notion that a large part of selling is optimizing where you’re funneling all of your cash. There are a lot of different options sellers have used to get an influx of cash, and we’re going to break all that down today, what those are, the risks associated with these methods and everything in between.
I’m Cameron Yoder, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 30,000 product launches and our experience working with more than 8,000 brands to help you understand the big picture when it comes to Amazon and the best practices for success as an Amazon seller.
Now before we jump in, I do want to stipulate that we’re running with a sort of different emphasis with this episode. So I’m going to break down the different methods we’ve seen sellers use successfully for funneling cash into their Amazon business. However, I’m also looking for a lot of input from all of you. So the different methods that you’ve – go back and get this – so the different methods that you’ve used, whether successfully or unsuccessfully, to increase cash flow. As you’re listening, when you think of other methods you’ve seen or used yourself, message me. I’m curious about everything that you’ve seen. So message Viral Launch on Facebook with any and all of the ideas and just tag me or reference me in the beginning of the message so that I can see them. So knowing that, thank you all ahead of time. I look forward to hearing from all of you. Let’s jump right in.
Okay, so we’re breaking down funding on Amazon, truly, truly Amazon you’ll hear a lot of sellers agree with the fact that Amazon is a cash game. Inventory, or there’s a lot of, just a lot of cash that’s tied up in inventory, and oftentimes people don’t have a lot of inventory management experience going into or working into the Amazon space. Oftentimes sellers are just not involved with that. And if you are, then awesome. Good for you. That’s actually a really good skill to have. However, for everyone else, managing inventory and cash flow is a new experience, and oftentimes people are asking, when people jump into the Amazon space, the Amazon game, they realize just how much it takes to scale an Amazon business quickly. And when you see – if you don’t have a whole lot of cash on hand at first, at least when you are investing in products, which is the case for a lot of Amazon sellers, scaling quickly is a really big challenge. And so today we’re breaking down kind of the different methodologies that people have used to fund their Amazon businesses and increase cash flow to funnel into other products. And we’re going to break down different risks associated and a couple things that you should ask yourself before you do something like borrow money.
Okay, so first off, borrowing money to scale your business. Is it recommended? Well, that’s hard – it’s really hard for us to give an exact definite yes or no, but we can break down different positives and negatives. So borrowing money to scale your Amazon business. Well, the positives are that you get more products and inventory quickly. That’s just that – that comes as a part of borrowing money. So yes, when you borrow money – let’s say you launched your first – let’s say you’ve launched your first product and are looking to grow your business and scale your business. Well, you can either wait – well, hang on – well, you can either wait and just kind of increase cash flow organically, or you can borrow money from something or someone else to increase cash flow to source another product right away since most of that money that you have available to invest in a product is going to be spent on just buying more inventory over and over and over again. So the positives with borrowing money to scale your business are you can just get more products right away, throw them up on Amazon. You can also buy into markets that you couldn’t access otherwise. So some markets require a large influx of cash in order to get started even, something like the supplements space. So if you don’t have that cash on hand, at least initially, borrowing that money could get you into more competitive markets and/or markets that have higher barriers to entry simply because of the startup cost.
You also have the ability to, instead of just investing if you borrow money, you can invest more in aggressive ranking strategy. So if you get an influx of cash typically you can put that towards either buying a new product to sell, to source, or to funnel – or you can funnel into your pre-existing, you’re already existing products, into being more aggressive, basically, with your launch strategy and/or ranking strategy. So basically borrowing money allows you to scale very quickly. More products basically equal or equate to a quicker growth as long as you’re picking, again, as long as you’re picking the right products. And in that, of course, you’re probably going to – you’re not going to have or pick all the right products.
Okay, so let’s actually talk about some negative aspects of borrowing money to scale your Amazon business. Well, number one, it’s risky. You will incur risk on yourself or your business depending on how you borrow money by borrowing money, basically. If you want to take that risk by kind of putting yourself at risk – no, hang on. If you want to put yourself at risk with this method of scaling, I mean honestly for some people it’s worth it. It’s worth the risk. For others it’s not quite worth risking that much money. For example, if you are not in a very good spot financially and you’re borrowing something like $50,000 or $100,000, being in or putting yourself in the position to take on that debt, really you basically as a seller, you should be okay with the amount of money that you’re taking on and the risk that you’re incurring. And if you’re not financially stable wise, then I would maybe reconsider borrowing money.
Now you also cannot count on every product succeeding. So just because you’re – if you’re borrowing money and are funneling all of that money into sourcing new products you can’t count on every single one of those products being successful. You need to count for – you need to take into consideration the fact that the money you’re borrowing to put towards products might not be successful. So you also should know what you’re doing. You should know – you should kind of explore these options before you jump into them, and also you should really know what you’re doing on Amazon. I’ll touch on that a little bit later. But also, kind of a negative aspect, depending on how you take money, if you’re taking a lot of money you could potentially have less control of your business. For example, if you’re giving up something like equity in order for, or for an exchange of cash flow or cash.
So there are really a couple questions that I would consider asking yourself before you kind of jump into or dive into the entire arena of borrowing money for your Amazon business. So kind of a first question to ask yourself is have you done everything that you can to increase sales in your current situation? I know a couple sellers who were just about to borrow – it was about $50,000, small sum, but for them it was a lot. It was a big amount. And they had enough cash to really pay it back over time, but they were encouraged by a friend of theirs to actually kind of dive into each of their processes and optimize everything that they could. They ended up not borrowing the money after they took a step back, analyzed their Amazon business and realized that their processes really weren’t optimized in terms of just their inventory flow, shipping and importing products into Amazon, and also the current cash they had on hand. So they optimized everything, and actually after optimizing everything they just chose to ride it out organically and ended up scaling fairly quickly. So it can be done. You do not absolutely need to buy – or borrow – sorry, borrow money, in order to scale quickly.
So are you on Page 1 for your primary keywords, for example? That’s an easy one. That’s one that a lot of sellers know, but also it’s important to take into consideration. Do you also know your primary keywords? Do you know your high opportunity keywords? Are you taking full advantage of all of those? I’ve said this before, and you’ll hear Casey and I talk about this, too, but keywords really are the [underpriced attention 0:08:18.5] of Amazon right now, and if you’re not taking advantage of that you really should consider taking advantage of that before taking a large sum of money.
Are your listings optimized? Do your listings include both sets of the high opportunity keywords and your primary keywords? Are your photos incredible for your high-earning or high-potential products? Do you have inventory management locked down? Many sellers downplay the necessity to honestly optimize the heck out of inventory management. So before borrowing money, knowing how and when to reorder units to take advantage of the money you already have is going to honestly be one of the best things that you can do for either when you borrow money in the future to really scale your business, but also in the time being before if you haven’t even borrowed any money at all yet. Sometime sellers don’t even need to borrow money if they optimize inventory management enough, like those friends that I talked about just a little bit ago. Now this might be a little bit slower of a method to scaling, but having this in place honestly could help if or when, again, you really do choose to borrow money.
Another really big thing to consider is if you’ve negotiated payment terms with your supplier. So a standard payment with suppliers happens within 30 days typically of reordering, and you could potentially negotiate to increase this to something like 90 days. So this is worth asking. Honestly we’ve had, or we’ve talked with, I’ve talked with a lot of sellers who have negotiated pricing and payments with their manufacturer, and honestly all it takes is a simple message, really, if they’re communicating with their rep over Skype, even just shooting them a message asking hey, can we expend this to 90 days? They might not agree flat out to the 90 days, especially if you have some sort of contractual agreement already. However, they probably will counteroffer with something like, oh, maybe we could do – we could work this out. So it’s worth a shot. It’s worth a shot asking your manufacturer to negotiate payment terms, which will kind of open up your ability to use cash flow in a – to use your cash flow in a smarter way, in a more optimal way.
So we talked about this a little bit before, but another question you really should be asking yourself is how much risk are you able and willing to take on? So a lot of the methods of – some of the methods of borrowing money incur risk on you, and really kind of the more money you borrow the more risk you bring on yourself. Let’s say if you borrow money and the product does not work, that could put you in a bad position. It could put you in debt, which ultimately will be just bad for you and bad for your dreams of freeing yourself as an Amazon seller.
A fourth and last kind of thing to really consider before borrowing money is that you should have a plan to allocate capitable – whoa, capitable – you should have a plan to allocate capital, any capital, cash that you bring on hand, that you borrow from somebody or something, you should have a plan for that cash. You can’t just borrow $50,000 and then not have a plan. You could do that, but that’s not going to make the most of your time. If you have a plan, you can borrow that money and have something like a payment period for that money starts when you borrow it, then you’re not wasting time. You know exactly what you’re going to do with it. Sometimes even a plan is necessary in order to borrow money. So for example, are you going to invest in your current products? Are you going to invest in new products or a mixture of both? What exactly are you going to put that money towards? Again, just make sure that you have a game plan for how and where and when you are going to use this cash.
All right, so we’re going to break down kind of the – again, these are the most, probably the most popular methods of borrowing money that we’ve seen Amazon sellers use. But again, if you have experienced anything else or something else very useful, go ahead and message me on Facebook because I want to hear. I want to know. You’ll be – your question or your – not your question, but your input will be put in the next episode. So if you want to be on an episode of Follow the Data, then go ahead and shoot me a message, all right?
So okay, kind of breaking down, I’m just going to summarize everything. I would encourage you really to – if you’re listening to this for guidance in which method you should pick to borrow money, I would really encourage you to do more research on all of these. Really, if you do a quick Google search for any of these or just like ask if you have financial advisor or anything like that you can talk to them in depth about all of these. But, all right, the options. So you could – option number one, again, is a pretty typical one, but dipping into personal assets or your savings. So kind of some – or a quick benefit of dipping into your personal assets or your savings if you have them, again, is that it’s quick and it’s easy. Most sellers, however, run into the fact that it’s limited capital. But many sellers also [discredit 0:13:31.5] really their ability to kind of just take a little bit more of a risk. I know a couple young sellers who are in a position to take a bit more of a risk, and because of that – just getting out of college and scaling pretty quickly – because they are able to take more risk they have really dipped into their personal assets, and they’ve taken away their – they’ve kind of taken away that money from, from spending that money on things that are really fun. Again, they’re young so something like vacation or a trip, they’ve taken the money away from that and put it towards the business. And granted, they aren’t able to do as many things that they want to do, but even in that they are growing their business because that’s actually what they want. That’s actually what they want. It’s actually what they’re looking for. So personal assets, quick, easy, but limited capital would really consider – or really consider this, but also really think about the position that you’re in.
Another one is friends and family, borrowing money from friends and family to scale your Amazon business. Again, the risk with this is that you’re putting your relationship with your friends and/or your family at risk here. However, if they are okay with that, then this not necessarily something that I would fully, fully recommend just because, again, it can really put your relationships in a tough spot. However, there is – however, this method really is quick and potentially easy, depending on your relationship with your friends or your family. But again, the risk comes with the relationships.
Now you can also, however, kind of with borrowing money from friends and family, just be in a position to negotiate well. So you can negotiate your terms pretty well with a friend or a family member. And of course you would want them to benefit, too, so in the end if you do it and you do it well, this can really end up benefiting both you and your friends. But again, if that risk of the relationships is worth it to you really consider this.
Another option that’s really popular are loans or small business loans. So there is also a lot that goes into borrowing or getting something like a small business loan, something like great credit score, a business that’s been running for years, a detailed business plan. These are all factors that could go into consideration for actually being able to obtain small business loans. I’ve heard of a lot of Amazon sellers kind of having difficulty getting a small business loan. That’s just the word that I’ve heard from the sellers that I’ve talked with. However, if you have any tips or good experience getting a small business loan, then again, shoot me a message. I’d love to hear about it.
Another option that a lot of sellers honestly do – another option that a lot of sellers honestly don’t really take into consideration are utilizing credit cards. So credit cards can be good, again, depending on the card and the line of credit. Some cards, for example, have 0% APR for the first year depending, again, on the card or the terms specifically. A lot of them have rewards that you will get if you’re spending – if you’re spending or you’re using this card toward something like inventory. And also it’s a pretty quick method of kind of just increasing your cash flow by a little bit. The negative aspects of using or utilizing credit cards – hang on. The negative aspects of kind of utilizing credit cards is that honestly it’s really unlikely to be enough to effectively scale your business. It’s kind of – credit cards give a good bump, again, depending on I guess how many credit cards or lines of credit you open here. But this can be enough to give a small bump for the small things if you’re a small seller, the small things around your business. However, it is a really good method, can be a really good method depending on what you’re looking for. Kind of also another negative aspect is that the interest here can really be – can be a killer if, depending on, again, the terms of the card, having something like 0% APR for the first year really helps. However if you are unable to pay kind of the credit back, then it really can kill – this can end up turning around quickly to kill the business. Also, this does kind of put a risk on you for your credit score, or with your credit score. Overall, credit cards, I would say pretty considerable in terms of small things that you can do to give bumps in cash flow as a seller who is kind of just starting out.
Another option is Amazon Lending. Okay, so Amazon Lending has low interest rates. And it’s accessible if you’re chosen. Honestly, if you’re chosen, Amazon Lending is a great option to consider. The negative aspect of Amazon Lending is that you have to be chosen. It’s a program that you are chosen for, you’re selected for based on certain metrics for how your products are performing or how long you have been selling. So Amazon lending basically is Amazon giving you a loan for your business. And like I said before, it has low interest rates, and it’s really accessible, but you really don’t control the terms. You either accept or deny what is being offered, and many sellers in the space, at least in the past, will say that they encourage other sellers to just kind of accept the Amazon lending if it’s offered. Really, in the end if your business is doing well and Amazon offers you kind of this loan or this format for a loan, it makes sense. It does really make sense to kind of take it, even if you don’t control the terms. Accepting this will give you kind of that influx of cash that then you will be able to pay off pretty easily through Amazon directly.
Now another method that a lot of sellers, or some sellers utilize is or are lending websites. So there are a lot of – there are a wide range of loans that are available on something like different websites. And there are varying interest rates as well. Lending websites are typically better for bigger sellers I’m going to say. However, smaller sellers do end up utilizing these lending websites. Hang on. I’m going to look up the website. I forget the name. What is it? Dang, I can’t find it. Well, all right, can’t find it. Edit all that out, that pause. But okay, we’ll continue from here. [0:21:50.7]
Really these lending websites, depending on what you’re looking for, might be the best option for you, again, as a bigger seller. However, also Amazon Lending seems to be kind of just one of the best options. Again, considering the fact that you are given access and that you are chosen, sorry. In the end there are, again, I’ll just go over these methods real quick. So saving personal assets, friends and family, loans, small business loans, credit cards, Amazon Lending or lending websites. Now there are, of course, more options. I just wanted to kind of outline the main ones that sellers have used and are using, and just some quick benefits or negatives to each of these. I would encourage you, if you’re interested in any of these, just pull up Google and do a quick Google search. Really I would consider – hang on. Really I would encourage you to know what you’re capable of. Ask yourself what you’re capable of in this moment as an Amazon seller. Really a lot of sellers haven’t actually considered borrowing money simply because they just haven’t looked into it, or they don’t like the idea of borrowing money from somebody. However, a lot of sellers that I do know that were able to scale so quickly and that are huge now borrowed money pretty quickly, pretty early on in their business. Now again, they took a risk by doing that, and some took that risk and kind of, it bit them in the butt, but – hang on –
Some took that risk and it ended up not working out. Really, though, I would encourage you to consider taking risks. Consider being aggressive. But again, be just flat out aware of the risks that you are getting yourself into. Borrowing money or financing honestly might not be the answer for you. Really weigh the options. Just like those friends that I talked about towards the beginning of this episode. They chose not to borrow money. Instead they chose to just optimize all of their processes, optimize the heck out of their listing, get some good photos, take advantage of the keyword opportunities that are out there right now, and it ended up scaling their business quicker than they anticipated. So really, financing might not be for you. Borrowing money might not be for you, but it also might be. Really weigh the options, have a game plan and track profitability.
Again, this episode was really created to just outline the basics behind funding on Amazon, but I really do want – I created this episode, we created this episode, to hear from you. I want to know your questions about funding on Amazon, what questions you have, if you’re looking for advice, and/or if you have different options that we did not go over today because there are a lot of options that we did not cover, but I’m curious what you as a seller are using or have considered using to just scale your business, whether that’s borrowing money or optimizing your processes. I want to know what you have done and what you’ve used. So thank you all so much for listening. I look forward really to hearing from you on Facebook. Also, if you haven’t yet, check out our YouTube channel. We’re really starting to pump out some content on there, so subscribe to that. We also just put a video out – I’ve talked about this before, but we talked about reviews a little while back on the podcast. If you haven’t heard, we now have a video and a blog post out covering kind of the results of our study on what’s happening with reviews on Amazon right now. So if you haven’t yet, go check out that video. I’ll see if I can put a link in the description of this podcast. So thank you, again, so much for listening. I look forward to hearing from all of you. Just remember, the data is out there.
Every success comes with a series of challenges; roadblocks along the way to test your resolve – to test whether you can progress to the next level of sales, or stay where you’ve been. We’ve been able to accumulate a LOT of data here at Viral Launch. We’ve also had the opportunity to see LARGE sellers scale successfully, AND see the same sellers struggle to progress past $1-5million in revenue. In this episode, we break down why sellers are getting stuck – why they AREN’T progressing. We’ll outline the problems causing stagnation, and solutions to make sure you can keep on growing your business.
Every success comes with a series of challenges, roadblocks along the way to test your resolve, to test whether you can progress to the next level of sales or stay where you’ve been.
We’ve been able to accumulate a lot of data here at Viral Launch. We’ve also had the opportunity to see large sellers scale successfully and see the same sellers struggle to progress past the $1 million to $5 million mark. I’m Casey Gauss.
And I’m Cameron Yoder, your hosts for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 35,000 product launches and our experience working with more than 10,000 brands to help you understand the big picture when it comes to Amazon and the best practices for success as an Amazon seller.
In this episode Cam and I break down why sellers are getting stuck, why they aren’t progressing. We’ll outline the problems causing stagnation and solutions to make sure you can keep on growing your business. Let’s dive in.
All right, we’re talking about getting stuck and pushing past the stuck, and to specifically stuck at around the $1 million to $5 million mark. That’s a pretty big dollar amount.
Yeah, so if you see me talk at conferences you’ve probably seen me talk on this subject. This is something that I’m particularly passionate about because it is so strange that so many people literally get stuck in this same revenue threshold or phase of your Amazon business, and I just really want to help people get past that point. We’ve seen people get stuck in this point and then get past it. We’ve seen people get stuck in this point and not get past it. And so I’m really hoping that we can share the tactics that these guys used, or what is the common factors of the people that went far past that.
And just to give a little bit of context, you know I have a lot of friends that are doing the 10, 20, 30, 40, $100 million on Amazon. So some of my good friends are doing well over $100 million. They have essentially four brands that are doing this, so these are very high-volume brands. I have another friend that did $80 million last year. They came to us in 2015. They were doing, I think, $40 million at that time. So we’ve helped them double their business, and this year they’re already on track to do $100 million, which is amazing. But you know, there’s definitely like some fundamental differences between these guys that are just having this meteoric rise and the people that have that meteoric rise until they get to the $1 million to $5 million mark. And so maybe you’re happy at the $1 million to $5 million mark. Maybe you don’t care to push past that. But a lot of people do, and a lot of people get frustrated with themselves. They start to kind of question their abilities maybe as entrepreneurs, or you know, there’s just a lot of frustration in this phase. And so I just want to help use the data, the experience that we have in walking people through this and watching people walk through this to help make sure that you don’t get stuck there. And even if you’re not at the $1 million to $5 million mark some of these principles can help you get there, and also you will be more confident that when you get to this mark you’ll be able to just cruise right on pass it to the $10 million mark, the $20 million mark and so on.
We are at a really good position, in a good position to aggregate a lot of data. Like again, we’ve talked about before if you’ve listened to the podcast before, you know that we’re all about the data, Follow the Data, everything like that. But it’s really cool for us to be in a spot where we can talk with all of these high-level sellers and know these sellers, and know what they’ve been through and see the roadblocks that they experience to be able to aggregate data kind of in a different way. It really is – it’s data from a seller’s perspective. It’s data from a seller’s experience, so it’s not necessarily numbers. Or it does involve numbers, but it also involves experience and everything in between. So like Casey said, even if you’re not at the $1 million to $5 million mark, there is still a lot here that applies to sellers in general.
Yep. And again, in terms of data, you know it may be one seller’s experience that they were able to get past the $1 million to $5 million mark, and that may not necessarily be a good fit for you. And so the advantage that we have is just we’ve seen so many instances of X, and so then we’re able to describe X from this vantage point of seeing different people walk through it in different ways.
All right, Casey, what is one of the top reasons that these sellers cannot push past that $1 million to $5 million mark?
Yeah, so reason number one is because sellers are becoming the bottleneck to their business. And so you know, I have a friend. Very quickly he went from zero to $500,000 a month, very, very quickly. I think it took him about six months to do that. And this guy was absolutely killing it, and I ended up talking to him like 9 to 12 months later, and he was still, you know, he was maybe doing $600,000 a month at that time, but there was very little growth. And he even admitted to the fact that he was struggling to grow because he was the bottleneck. Like he was managing his own PPC. He was doing literally like everything maybe outside of like customer support and stuff like that.
And so he – and the reason – so I asked him, well why don’t you build a team? Like you need to get other people in the team so that they can handle these things so that you can focus on the really high-growth levers. And he said he has such a hard time doing that because he’s a perfectionist, and he knows that people will not do it as well as himself. And I hear this excuse all the time. And I totally get it. So I have a little bit of experience in that. You know, we have 47 employees now here at Viral Launch. And so I understand that, but the way that you have to look at it is, you know, look at Mark Zuckerberg, right? Mark Zuckerberg, probably a great programmer, and Mark Zuckerberg isn’t coding. He hired people that are probably a lot better coders than himself, and even if not he understands that if he wants to build Facebook he can’t sit there and write code every day. He needs to be a CEO. And I want to encourage you to get in that CEO mindset. If you are amazing at PPC, maybe that’s one of the last things that you outsource, but you need – there are so many things that you are doing that you probably shouldn’t be doing.
So if you look at things – let’s use some data. So if you look at things from an opportunity cost perspective, so let’s say you’re a $1 million seller, which equates to, just for simple math, you know, $80,000 per month, and there is around 168 business hours per month. That’s like 40 hours per week, let’s say. So if you divide that $80,000 per month by 160 hours, that’s approximately $500 an hour that you’re making. And so that means that whatever you are doing is worth $500 per hour, assuming that you work just business hours. Most of us don’t, but whatever. So anyways, for the sake of the example bear with me. So basically what that means is if there are things that you are doing that you cannot outsource for less than $500 an hour, you should be doing those. But if you can find someone to do these particular tasks, whether it is talking with suppliers to make sure that you’re getting samples, or whatever. So if you can find someone to do that for less than $500 an hour you’re making more money by doing that so that you can focus on the higher-level issues.
And so this should – I think it’s obviously harder to apply, but anyways this is just one quick example of if you’re a $1 million seller, even if you’re half that, if you’re making basically $250 per work hour, you can hire people. You should not be hiring anybody that is even close to $250 an hour. That means almost everything you should be outsourcing. My friends who are doing $100 million, the only way that they got there was they had a team in place that is doing everything from going and checking – let’s say you weren’t using software. So they’re going and they’re checking to see, okay, is the product ranking? Do we still have the bestseller badge? How are our competitors doing? How are our sales today? How are our sales this hour? How is PPC? Like, one, you should be using tools to monitor these things for you so you’re not wasting all this time.
Again, if your time is worth $500 an hour and there’s a software that does it for $40 per month, oh my gosh, like come on. I know that it’s easy to want to save money, but if you think about it from an opportunity cost standpoint you need to do things to get to that $2 million mark, to that $3 million mark, to that $10 million mark. And the only way that you can do that is by focusing on the high-value things. So if you’re spending half of your day going and looking at metrics, going and making sure that your reviews are still good, that you don’t have like bad reviews getting upvoted, all these things. There are tools that can monitor these things for you, or at the very least maybe you don’t trust the tools for whatever reason. You can hire someone at $5 an hour, $10 an hour to go monitor these things for you, and now you’re paying $20 bucks a day or whatever, and you’re still getting it done. And I know that’s $20 a day that’s going out the door, but theoretically now you’re able to focus on the super high-value things, which is maybe new product selection, expanding your brand, like these things that really matter, focusing on getting keyword ranking, or figuring out some method of driving reviews at a better rate. These are the things that are really, really making your business grow. And yes, you obviously need to understand how the metrics are performing and stuff.
Anyways, long rant to say you absolutely cannot grow to whatever you aspire to or – I hope you have big dreams. You can’t grow to whatever you aspire to without hiring people. And you know, here at Viral Launch I try to hire people that are better than me at everything, essentially. And if they’re not better than me, then we’re probably working together, and they’re better at some aspects of that.
So my favorite thing is product. We hired a Director of Product, and while she is great at coming up with ideas, she comes up with a lot of ideas and then we just work together to prioritize them and make sure that we go with the best ideas at the best time. But she’s so much better at organization, execution, and so she’s focused on those things. And whatever you’re best at, maybe it’s PPC, or maybe it is in product selection. At first maybe don’t outsource those things, and then what you end up doing is you hire someone that is pretty good at PPC that you can coach through. You can show them your process, and as long as you’re doing a good job as a manager, as a leader, like you don’t necessarily have to have these fears that they’re just going to take all your information and run. And even if they did, like they’re going to work for you for some period. Like I think your worst-case scenario is not nearly as bad as you think, and your worst-case scenario is probably not nearly as bad as you getting stuck at that $1 million mark.
I think a lot of high-level sellers have a lot of trouble getting over the thought that, getting over the thought of failure. Like the question comes into their mind. There’s failure and ego. So why – the question is why would I bring somebody on that is going to fail? And I think you, as a high-level seller, need to accept the fact that you will fail and that your team is going to fail at some point in time. Like you will experience failure. If you haven’t yet, go listen to our failure episode of our podcast because we talk about failure in that. But you as a seller, you need to realize that in order to get over that $1 million to $5 million mark, or even to get to that spot as well, you need to outsource, and that when you’re going to outsource jobs, or statistics, or whatever you’re doing, any job, then that person is going to fail. You have to accept that. You have to be okay with that. If you just going to do everything yourself, again, you’re not going to scale. And if you bring someone else on, they’re going to fail. So teach them well. Recognize that they will fail at some point. And you have to be okay with that failure to grow, to scale. Now teach them and learn from that failure. Learn from that failure to move forward, but also don’t let that failure, the idea that failure will happen, stop you from bringing people onto a team.
Yeah, and if you operate from the standpoint, not that you could hire someone, but if you operate from the standpoint that you have to at some point hire people to do these tasks or to help you run your business, then it starts to become a little bit easier to digest that well, if I am going to be doing this at some point, well now is better than later because Amazon is easier now than it’s going to be tomorrow, than it’s going to be a week from now, than it’s going to be a month from now. Whenever you quote get around to it, it’s like hire them now so that you can really start to propel your business to the next level.
So I know that we’re kind of hitting this hard in terms of hiring a team. So one thing that I want to share from probably the most successful entrepreneurs that I know, these guys that are doing over $100 million a year, and actually the way that they hire is very interesting. So essentially they go and they will find people that are like $10 an hour, $20 an hour people for the most part, and they just are – they do a really good job of helping them learn how to do whatever their job is really, really well. So versus going and hiring someone that you have to pay $60,000 a year to do this or that, like they just find someone that is really hungry and will be very thankful for their job, and they just teach them how to be a project manager, how to get products ranking, how to get reviews, how to manage customer service. And so anyways, like you don’t necessarily have to just go and ball out and spend all this money to hire these people. You can hire people that are going to be great. And if you truly feel like you are an expert at PPC or whatever it is, you can teach these people to do it. And sometimes yes, it is taking one step back so you can take two steps, three steps, 10 steps forward. Insomuch as yes, you’re going to have to take time to train somebody. We’ve hired 47 people, so we’ve trained 47 people. I cannot tell you enough Viral Launch would be nothing that it is if it was still just me, not like, not at all.
And so anyways, again, I just can’t encourage you enough. You don’t have to go out and hire expensive people. You can find those $10, $20 an hour people that can help get your feet wet in terms of hiring, training, getting people going, and then you can start making decisions from there. Okay, actually I do want to have an in-house graphic designer, or I want to have an in-house logistics person because I’m really starting to move product, or whatever. Now you can start thinking about maybe these higher-level people that have experience that you don’t have to train that are going to be so much better than yourself. And I think that I can’t encourage you enough to try to think realistically. Where are the areas that you are not super strong in? And maybe that’s probably where you – that’s probably where you should start hiring, and hire someone that has that experience.
I think once you get a good taste of bringing someone on your team that just alleviates some pressure or some time you won’t want to go back. Like if you have the time and the resources and you bring someone on and they can just help you live literally just a better life or live with a little bit less stress, or just increase revenue or whatever, then you’re not going to want to go back.
And sometimes it can be awkward from the standpoint of like, you know, I’ve definitely felt this at phases of the business. I absolutely do not feel it right now. But if you do a great job of bringing these people on you will feel a little bit awkward because it’s almost like, well, what am I supposed to do? Everybody else is working, and I don’t even have that much to do because I’ve outsourced it. Like that is the perfect place to be because you’ll see that once you start getting out of the weeds you’re able to think at a higher level, and you’re able to bring these super valuable thoughts and ideas, and this vision or whatever, to your team and start like oh, now I can really start thinking about how do I set myself up for an exit, right? Now there’s a different mentality there.
So anyways, one quick example, I just saw a friend of mine on Facebook. He’s this one, two, I don’t remember, $1 million to $2 million dollar seller, I think. But he’s growing quickly. Anyways, he just posted this photo of him and his wife have like sheets all over their kitchen or something, and they’re doing their own photography. And the amount of time that they spent to set up this white like studio or whatever is, if they’re doing the opportunity cost situation, like they are spending way, way more money by trying to do their own photos, and who knows how they’re going to turn out, versus hiring someone to do your photos. Of course I’m biased in saying that, but I just can’t encourage you enough. You know we always talk about you have to do everything as well as possible. That’s the only way to compete, especially as Amazon continues to become more and more competitive. But yeah, cannot encourage you enough.
All right, Casey, we’re talking about, or let’s touch on the next point, launching more products. Casey, what do you think?
Yeah, so overall I see, again, so many people get stuck in this phase because they get to the $1 million to $5 million mark, and understandably they want to diversify. They don’t want to be completely focused or centered or have all their eggs in this Amazon basket. And so they start to try to diversify. They start to try to try to build out their Shopify store. They try to build out Facebook pages. You know, they’re trying to do whatever they can, maybe get into retail I’ve seen happen. They try to do whatever they can to diversify their revenue, and I definitely get it. The problem is of the, you know, however many people I’ve seen go through this phase I haven’t honestly seen anybody that has increased their revenue by more than 10, like 10% to maybe 20% by focusing on these other channels.
Meanwhile, because they haven’t built that team around themselves, their Amazon business is stagnating. And so like here’s the thing. If you’re selling $1 million on Amazon the way you got there was by launching more products and doing, taking – doing a good job of taking care of the products that you have. And so if you’re trying to get to the $2 million mark just launch the same amount of products, or just launch more products to do exactly what you did to get to $1 million to get to $2 million. Or let’s say you’re selling $3 million a year and you have 15 products, or it should be high-volume products. Let’s say you have 30 products. Just launch 30 more products, and now you’re doubling your revenue or so. Again, I see so many people that get so focused on Shopify, even these huge sellers I’ve seen where they’re past the $10 million mark, and they go and they spend a ton of money, a ton of their mind space on trying to diversify outside of Amazon. They have such a difficult time doing that.
So why do you think big sellers do that, or just sellers in general?
Why do sellers have a hard time?
Because Amazon is so easy. So if you learn how to build a business on Amazon who is focused on driving all the traffic for you, all you have to do is figure out how to get in front of it and then have a good offering once you are in front of them versus a Shopify store, you have to do all those things. You have to have a good offering. You have to do all of that, but you are now also responsible for driving traffic, and you spend – like the way to really succeed there is you have to build out all these funnels. And it is such a different game. And if you really understand that game then you really understand that game, and you could be successful here. But I would say the majority of, at least the people that I’ve worked with, are people that start their business as an Amazon business. That is their entrance into e-commerce, and just overall, if Amazon is sending you all the traffic and all you have to do is get in front of it, that takes out half the equation, whether you’re good at the Shopify stuff or not.
Do you think there’s a mentality that it’s almost too easy and so because it’s too easy they’re like maybe I should challenge myself a little bit more, when in fact the answer to everything is it doesn’t have to – like it doesn’t have to be hard? Amazon doesn’t have to be difficult.
Right. I don’t think that too many people are focused on challenging themselves as businessmen or businesswomen. I think that most people are focused on how can I build my empire? How can I make as much money as possible? And if that is what you’re asking, then I think Amazon is absolutely the way to do it. If you’re selling a few million dollars on Amazon you have the infrastructure, some amount of infrastructure. If you don’t, then listen to point number one. But you have the infrastructure to, again, launch more products. Even if those products are outside your brand, there are so many high opportunity markets that you could be jumping into very, very easily using the methods that you already know how because you’re at that million or so mark, and you could just continue to expand your revenue and expand your product line.
You know, I have some friends where they got to the $8 million mark or so, and they went and they spent a ton of time on trying to get into retail. And while they tried to get into retail they completely neglected their Amazon business. I don’t really think they launched many additional products throughout this whole calendar year, maybe a couple here and there. But anyways, their revenue actually had started to decline because they had taken their eye off the ball. So many things had changed, and they were just so focused on chasing retail. And throughout that process they landed one retail deal that didn’t even, you know, wasn’t even that great of a deal for them. And their Amazon business, they had negative momentum, or bad momentum. And so it took them a long time to like push that rock, get that rock going back up the hill. And I felt bad. And had they either put the infrastructure in place so that they continue to launch more products on Amazon and have someone really in the weeds on Amazon, and then the business owners wanted to focus on going outside of Amazon, then that would have been fine. But it was kind of this binary all or nothing. We’re only focused on retail right now because we need to diversify, and like that’s really sexy versus what is really sexy is a business that is continuing to grow.
A business that’s actually growing.
Right, exactly. And also for a while a lot of the gurus were just preaching because everybody wanted to learn, how do I build my Shopify? How do I go outside of Amazon? And you know the majority of people are talking about Amazon. And so the sexy thing for the gurus was to talk about the off-Amazon stuff. And for a while a lot of people were just pushing; you’ve got to diversify, you’ve got to diversify, you’ve got to build a brand, you’ve got to do all these things. And people were eating it up because they didn’t know how to do that, or they were trying to do that and it wasn’t working, again, because it’s not as easy for most people.
And so anyways, if that’s what the gurus are incentivized to share, that’s what they’re going to share for the most part, unfortunately. But we’re the whole time saying no, Amazon, Amazon, Amazon. And recently, though, I’ve seen a number of gurus or people building courses or whatever, that are now focusing more and more on Amazon, and I love it. I think that’s absolutely what people need to be doing.
It was that period of time, and it still happens, where gurus recommend getting off of Amazon or things that honestly don’t really are not going to drive success or growth as quickly as just focusing on Amazon, but it was really like kind of a closed circuit where gurus were suggesting what the people wanted to hear and what the people were eating up, and the people were eating up what the gurus were suggesting. So there wasn’t actually any truth in what was happening. It was just both groups feeding off of each other without an actual foundation.
And I think that cycle unfortunately is just a reality of a space with gurus because –
And that’s not all gurus. That’s not all gurus.
Right. No, no, and I appreciate the people that don’t care about what like is sexy necessarily. They just want to speak the truth because it’s the truth that is really going to help build the business and help their constituents succeed. But of course, right? Like if everybody is reading these types of posts, watching these types of videos, then if your only focus is not necessarily on helping people, it’s on building your audience, then you are going to share that with them. So I have some other friends that are in this same exact phase. So they got stuck at $1 million in 2015, which is pretty early days, probably right around mid-2015, maybe late 2015, they hit the million dollar mark, and I just found out that they’re still stuck at the million dollar mark middle of 2018, and they’ve been investing in some of these higher-level masterminds, paying a good amount of money to start rubbing shoulders with these bigger sellers. And the problem is this one particular mastermind is very focused on selling outside of Amazon and building all this stuff outside of Amazon. And so these guys, they still have full-time jobs, and so their focus right now is on building all this stuff outside of Amazon versus focusing on what got them to the million dollar mark. They have an awesome brand on Amazon. They have awesome products that I think are just – I think they do a really great job from a product perspective, and I think that they could absolutely kill it. They easily could have surpassed the $1 million to $5 million mark had they have kept their momentum in 2015. And now they’re spending so much time. They’re going to what I would call in some cases drastic measures to try to get past this $1 million mark. They’re literally just at $1 million. And again, just another example of people that are getting stuck in this stage. And again, we’ve seen it so many times. I just want to share as many anecdotes or stories as possible so that maybe one resonates with you a little more than the other, and you can start to see wow, okay, I need to make some maybe mental shifts so that I can get in the state or the flow that I should be.
All right, so kind of the last point here is just talking about how quickly the Amazon space changes and how much, how quickly that you can get behind if you get comfortable with where you’re at in the Amazon space, with how much you’re selling or where you’re at, or if you don’t really want to grow, or you kind of stay stagnant for a little bit. The space changes a lot, and you can fall behind.
Absolutely. This is kind of an offshoot to the second point, but essentially we definitely see people that, they get to this $1 million to $5 million mark. They’re a million-dollar Amazon seller. They have a million-dollar business. Probably in the course of a year to two years you should absolutely be proud of yourself, and you should be celebrating that. But the problem is I see some people that they, again, get distracted. They get excited about being this million-dollar seller. They want to go do million-dollar business type things, or they want to go be a rich person, hang out on the beach, and they really lose sight of what is working on Amazon. And it’s this, you know, three months of not paying attention to Amazon, so many things have changed. Over the last three months millions of reviews have been wiped off of Amazon. Now products are getting blocked from reviews. Who knows? There’s going to be an algorithm shift when it comes to ranking. There’s going to be 10 new black hat methods that people are using to get reviews or to get keyword ranking. I mean there are so many things that change within the course of three months, let alone a year or whatever.
And so anyways, I see people. They get to this mark. They feel amazing, as they should, but they lose focus, or they start hanging out on the beach and say oh, my business is just going to take care of itself. Meanwhile they haven’t done a good job of putting the infrastructure in place, and they start seeing revenue decline, or maybe it’s not growing like they thought and they try to come back in, and it takes them six months or whatever to kind of turn the ship around because, again, they’re headed towards a revenue decline or whatever.
So I think it really depends also on kind of what you want because there are sellers here who are okay with just staying at the $1 million to $5 million mark.
In that case, though, this really, it’s really important for you to be aware of the fact that when you do get behind, instead of staying at the same spot what’s probably going to happen, and what’s most likely to happen is the business will maybe start to decline, like you said, Casey. And so if your goal is to kind of just maintain a position, there is a level of energy still that is required for you to input into the business, into an Amazon business, to stay up-to-date with everything that’s happening.
Yeah, unless of course you put in really good infrastructure –
– so that your team is able to take care of things. But I’ve seen too many people that don’t do that. Or one thing that I’ve actually heard a lot again from these people that are in this range is, you know, personal things get in the way. And so it’s like, guys, if you build the infrastructure then you don’t have to worry about these personal things coming up. I understand unforeseen things will happen. Unforeseen events are going to come into your life at some point. But if you have the infrastructure in place you do not have to worry about that.
So as a whole, I mean, Casey, this is a lot of information. And I think it can be overwhelming for people to think like oh, I’ve got to even reach the $1 million mark before I even start to think about all this stuff. Like there are so many things that I need to do. So far all these people that might be feeling a little overwhelmed just about their Amazon business and scaling it well, scaling it correctly, what would you say to them?
So basically I would have – my suggestion would be to, you know, what’s the saying? You can’t eat a horse all in one bite, or an elephant all in one bite? How do you eat an elephant? It’s one bite at a time, right? So same with this elephant of a business or, you know, if you think about your ideal business and how it’s running smoothly without you. It’s growing. It’s finding the right products. It’s treating your customers the right way. You know, the brand perception is there, like all these things. If you think about this ideal business you don’t just do that in a week or a weekend. It’s something that is done in the minutia of the day-to-day so that you’re making the right decisions that roll up to a few years from now that you have that business that you – or maybe by the end of the year, whatever, you have that business that you’re aspiring to or you dream of. And so the best way to get started is to just put down these notes and say like okay, here – or put together a plan. Here is what I am looking for. Okay, so I’m looking for a team that can manage my Amazon business without me. Okay, awesome. Let’s start with that. Let’s figure out what is point number one of that? Okay, you need someone to – you’re still managing customer service. That is definitely one of the first things that you should be outsourcing. Okay, go on Upwork or wherever, and start finding that potential customer service person.
Now there will definitely be hiccups along the way. You will feel like you’re wasting your time doing this. It may take – I once tried customer service through Upwork, and it took like three or four people to figure out who was good. And so maybe it will be annoying because you just had three customer service VAs that were terrible, and you’re like well, this isn’t going to work. The thing is if you operate from the standpoint of you know that it works, you just have to figure out the right person, or you had to figure out the right process to get it to work, then you will.
So anyways, yeah, the suggestion is don’t get overwhelmed. Just get excited about what can happen. List out the plan of, how can I get there? And then just start executing on that. Handle point number one. Handle step number two. Handle step number three. And bring people on board to help you accelerate how many steps you’re taking, or to take on bigger steps that you may not be able to take yourself.
I think one of the biggest questions you need to ask is – and not everyone that’s listening is going to be at the $1 million to $5 million mark, so ask yourself personally what is holding you back? It could be yourself. It could be outsourcing. It could be that you’re not launching enough products right now. Wherever you’re at, sit down, think, ask yourself some tough questions and get yourself some really, realistic answers.
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