Author: <span class="vcard">Rebecca Longenecker</span>

Follow the Data Episode 8: Are Amazon Reviews Going to Change? 

Reviews can pose a huge threat to the success of new products, and getting legitimate reviews early on can be difficult. Will this barrier to entry stagnate the market and ruin the competitive environment that Amazon shoppers love? Join Viral Launch CEO Casey Gauss and co-host Cameron Yoder as they speculate about the future of Amazon reviews.

Follow the Data Show Notes

  • If only you could get to 21 reviews! Then you could really compete. Check out this Seller Sessions video where Brad Moss talks briefly about the study that found conversion rates didn’t improve past 21 reviews.
  • LinkedIn uses a model that might work nicely for Amazon reviews in the future. Any connections you make over the 500-mark show up on your profile as 500+. Seems a bit of an unfair system for those of us who are extraordinarily popular or have really killer products. But check out some of the hidden benefits that having more than 500 reviews affords you.
  • Amazon’s Early Reviewer Program helps new products get their first 5 reviews and is available as part of their Brand Registry Program. Find out if you are eligible here.
  • Leave us a voicemail at (317) 721-6590 and tell us what you thought of the show. What do you think is in store for Amazon reviews?

Podcast Transcript

CASEY GAUSS:
Reviews are the currency of the Amazon marketplace.

CAMERON YODER:
But is change to Amazon’s current review platform on its way? I’m Cameron Yoder.

CASEY GAUSS:
And I’m Casey Gauss, 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 25,000 product launches and our experience working with over 6500 brands to help you understand the big picture when it comes to Amazon and, most importantly, the best practices for success as an Amazon seller.

CAMERON YODER:
Today’s episode is a bit different. We’re going to branch out a bit and talk more conceptually about Amazon’s current review system, how it currently works, potential impacts and flaws and changes that we think might be on the horizon. Let’s get started.

CAMERON YODER:
All right, Casey, so today’s episode is a little bit different. It’s not as data-driven, right, but it’s conceptual, and it’s important. So what are we talking about today?

CASEY GAUSS:
Yeah, you know, in terms of data I would like to think that maybe the data has helped us to build the conceptual model around Amazon.

CAMERON YODER:
Yeah, yeah.

CASEY GAUSS:
I definitely think that the data has helped us to, anyways, build this theory. And so essentially the theory is that, you know, I think in somewhat the mid-term, the short- to mid-term we’re going to have to see Amazon make a systemic review change, and we’re not talking about, you know, not being able to get reviews from discounted promotions or anything small like that. I think –

CAMERON YODER:
Something much bigger.

CASEY GAUSS:
Yeah, yeah, exactly. And so I’m pretty interested to hear what the feedback will be. I imagine something like this will be somewhat polarizing in terms of people seeing our view, as well as maybe a complete opposite view.

CAMERON YODER:
Yeah.

CASEY GAUSS:
And I imagine other people will have probably better thoughts than I do.

CAMERON YODER:
I mean we have – we’ll touch on this again at the end, but again, we have that phone number, and we’ll read the number out at the end of the episode. But if you have an opinion on this, then seriously feel free to call in and tell us what you think, or again, just ask any questions on what we’re going to go over. But first off –

CASEY GAUSS:
Yeah, please. I mean I’d love to hear people’s ideas and feedback because it can help us better lay out our product roadmap so that we’re making sure to help sellers in the best way possible or help us give better advice. So, anyways –

CAMERON YODER:
Exactly.

CASEY GAUSS:
Yeah, so let’s just jump into it. So just as a quick overview of the current review system, the current system, in how it works is essentially obviously someone buys a product.You are able to go and leave a review as a customer. Let’s – we’re talking from the perspective of a customer.

CAMERON YODER:
Right, right.

CASEY GAUSS:
And so these reviews accumulate. And so if you have 10 people review a product, or 10 people review a product, now it has 10 reviews, and the way that a rating is calculated, so a star rating is being shown, the way the rating is calculated is it takes into account recency, and it also takes into account whether or not a review is verified or unverified and puts together some amalgamation or some, you know, average rating, even though it’s not a straight average, rating of that product’s reviews. And so –

CAMERON YODER:
Do we have data on how recent, how far back it goes?

CASEY GAUSS:
No, so we haven’t tried to, you know, reverse engineer the algorithm of reviews, and I – theoretically I imagine it wouldn’t be very difficult to do. There’s just really, you know, no –

CAMERON YODER:
Not too much point?

CASEY GAUSS:
Yeah, yeah, it’s not going to help us. I mean at the end of the day you need to have a great product that people want to leave good reviews on.

CAMERON YODER:
Right.

CASEY GAUSS:
We’re not trying to game reviews. That’s the last thing that we want to do here.

CAMERON YODER:
Right, right.

CASEY GAUSS:
And so there’s at least right now no point.

CAMERON YODER:
Well Casey, you touched on this a little bit. Just to get everyone in kind of on the whole picture of reviews, you can get reviews from someone buying a product on Amazon, right, but that all reviews on the platform might not be from people that have bought the product on Amazon. Explain that a little bit.

CASEY GAUSS:
Yeah, so unverified – so there’s this concept of unverified reviews, which is now there’s two different camps of unverified reviews. Essentially, one, let’s say you bought a product at Walmart and you want to leave a review on Amazon. You can. And that is an unverified review. It’s completely within Amazon’s terms of service, and they actually encourage it. I think the whole reason behind these unverified reviews is it was, especially when Amazon was a young platform, a way of them, you know, bootstrapping and accelerating their review system.

I mean that was one of their initial kind of advantages is they have this review system that buyers know and trust, and that social proof helps them to make better buying decisions in e-commerce, which, you know, five years ago, 10 years ago, which was a very, you know, different situation than it is now. The trust was very difficult that I’m buying something that I haven’t been able to see, you know, touch or feel. So I don’t know the quality. So now I have to trust in this social proof, or these reviews that other people are leaving. And so that’s what really helped to – that’s one thing that helped Amazon to grow.

But anyways, so a new product comes onto the platform. A new brand comes onto the platform that has maybe been doing well in traditional retail or something like that. Well now that brand can get their customers that are buying somewhere else to come leave reviews on Amazon’s platform. That helps Amazon out because now they have more reviews, more social proof around these products which are going to better drive sales, and then also that helps that brand out because, again, they’re going to drive more sales.

CAMERON YODER:
Because as a big brand it wouldn’t really make much sense to, if you have all this social attraction already, if you have all these reviews already, to not be able to bring them on with you. That would just not attract a lot of big sellers that already have those things in place. And so of course having those things in place is going to be able to encourage big brands to come onto Amazon if they’re not already.

CASEY GAUSS:
Right. And so from a buyer’s perspective reviews do two things. One, they act as an indicator of popularity. So buyers are not looking at a bestseller rank. They’re not browsing through the bestseller rank tree.

CAMERON YODER:
Looking at their reviews.

CASEY GAUSS:
Yeah.

CAMERON YODER:
They’re looking at their reviews.

CASEY GAUSS:
So obviously if something has, let’s just say 10,000 reviews, well, at least 10,000 people had to have bought that. So it must be somewhat popular, right? And so versus a product that has 10 reviews. Well, it doesn’t look like as many people bought that. So it must not be popular. There may be some, or must be some reason that I am not aware of which is the reason why not as many people have bought it. Maybe it’s new and not as proven, or maybe it’s just not as good, or maybe people don’t trust the brand. So I am less inclined to go and trust it as well.

CAMERON YODER:
Right.

CASEY GAUSS:
So anyways, acts as an indicator of popularity, and then obviously acts as an indicator of quality. So you know a five-star product with a great number of reviews seems to be of good quality. A product with a two-star rating and a significant number of reviews seems to be a product of low-quality, so I’m less inclined to buy it. And so anyways, reviews, again, act as this form of social proof giving me confidence to buy the product. And so from the customer’s perspective that’s that. From the seller’s perspective, you know, we really see the data around reviews being the barrier to entry. There’s –

CAMERON YODER:
Right.

CASEY GAUSS:
Okay, so this is a little tangent on a myth, but you know, there’s recently these articles coming around where Amazon, Amazon did this internal study and the magic number to reviews is 21, and so – I believe it’s 21.

CAMERON YODER:
Wait, 21 –

CASEY GAUSS:
Reviews.

CAMERON YODER:
What do you mean, to be successful?

CASEY GAUSS:
So yeah, so the myth is if you have – I think it’s 21. Please don’t quote me. It may be 22. It’s somewhere around there.

CAMERON YODER:
It’s like 20s, right?

CASEY GAUSS:
Yeah, so anyways, if a product has 21 reviews it is able to drive, you know, a significant number of sales. And so basically the myth was if a product had – I believe I saw this quote. Again, not verbatim, but if a product had five reviews but an average rating of 4.8 or something like that, it is less inclined to drive sales than a product with 22 reviews – it’s above that threshold – and an average rating of three stars, right?

CAMERON YODER:
Which doesn’t make sense.

CASEY GAUSS:
At least for me, no, it doesn’t.

CAMERON YODER:
Personally, same

CASEY GAUSS:
And again, looking at a bigger market where a product has 10,000 reviews and the other product has 22 reviews, I’m pretty sure that customers are going to treat these different. The reason why I feel this way is, again, because we have the data around it. We’ve put so many products up on page 1 that have like one review, zero reviews, 50 reviews, and everybody else has 10,000 reviews or 1000 reviews, whatever. They had this significantly high review quantity, and we see these, the people with smaller review quantities struggle to sell at market potential because they don’t have a competitive number of reviews.

CAMERON YODER:
Right.

CASEY GAUSS:
The thing is we don’t know this study, right? So we don’t know what variables did they isolate? Which variables did they not take into account? Are these on, you know, products that aren’t ranking, or you know, maybe they are ranking in a small niche. You know, I have no idea. Or they’re highly-dependent on, you know, some product that really pays attention to creatives. I have no idea, so. I didn’t see the study, which makes it hard for me to judge. I have, you know, we’ve run 25,000 launches, and we’ve seen this over and over. Are there extenuating cases? Are there corner cases in which products with low review quantities do well? Oh, of course, and are there ways to mitigate the difference between a product with high review quantity and low review quantity in terms of sales? Oh, of course.

With that from seller’s perspective the way you see reviews largely as one, as a barrier to entry in a market, two, as this thing that is so elusive as Amazon continues to make getting reviews more difficult, legitimately.

So yeah, so kind of just wanted to paint the picture there. Next, we kind of wanted to talk a little bit about flaws of this current system. And so if reviews are really the barrier to entry in a market, well, just as a function of time reviews are going to increase. So let’s say that, you know, just on average page 1 sellers have 1000 reviews,Well, 50 years down the road those products are, those people on page 1 for fish oil, assuming they maintain rank and people continue to buy fish oil, you know, let’s take out all these other variables that we don’t really need to account for for this example. Anyways, they will have 50,000 reviews. Let’s say on average the product gains 1000 reviews a year. Let’s just say. So 50 years from now you’ll have 51,000 reviews. And so if let’s say this brand-new formula for fish oil comes out –

CAMERON YODER:
It’s really good.

CASEY GAUSS:
It’s way better than everything else.

CAMERON YODER:
Fantastic.

CASEY GAUSS:
It’s also half the price, but you launch it on Amazon, and Let’s say I get on page 1 and I have three reviews. And everybody else has 51,000 reviews and they have just as good a rating, or …

CAMERON YODER:
Put yourself – put yourself in that situation. If you’re buying that fish oil, which one are you going to buy? Which one?

CASEY GAUSS:
You know, everybody’s fish oil says it’s amazing, and you know, says it’s the best, the highest-quality, blah, blah, blah.

CAMERON YODER:
Oh, but shoot, 50,000 people have left a review on this one, on average.

CASEY GAUSS:
And here you are with 50 reviews claiming to be a much better version blah, blah, blah. No, no one’s going to trust you because the social proof is saying that these other guys are better. And so this is a problem because it creates stale markets, and especially over time the problem just continues to amplify.

And so there has to be some method that allows new products to break into the market and compete well. And because you just stifle competition, or let’s say everybody kind of starts to decrease the quality of their fish oil to save on margin. Well, they still have 48,000 or whatever, reviews that have that good rating, and yeah, Amazon does take into account recency. But again, these guys have 50-some thousand reviews that are helping to boost that rating. I don’t know, I just think that there’s so many possible scenarios, and all of them lead to this problem of stale markets because review quantity is a major decision-maker in people buying a product.

CAMERON YODER:
Well, and it’s like if you – that’s from a buyer’s perspective, too, but from a seller’s perspective if you are – if you are – this is another perspective to look at – if you’re a seller and you’re selling that fish oil that has 50,000 reviews you’re probably not going to want to re-enter another product into that market because you’re, I mean in a sense you’re kind of trapped.

It’s a good trapped because you’re making a ton of money because you’re locked in at 50,000 reviews, but you don’t want to refresh or do anything that would have you release a new product into that same fish oil market, for example, and all of a sudden you don’t have access to those reviews – like if you release another SKU into that market. You might be trapped into the markets, into the current markets that you’re selling in because of those extremely high review quantities.

CASEY GAUSS:
Yeah, and you know, I could see – there’s probably a million things I can’t even imagine that would happen here, you know. I could definitely see in some markets like the beauty space, I could see one or two brands just going and buying all the private label brands just so that they can dominate page 1 because okay, I mean we’re already seeing it in some of these highly-competitive markets where these guys have just thousands and thousands of reviews. And it’s tough for new brands to come up.

And so if you had two – two companies go and buy, you know, 50% each of the top selling brands in the third-party beauty space right now or private-label beauty space, these guys would essentially own beauty on Amazon and make it extremely difficult for any new sellers to come into the market. And I, again, I just think that competition is what has made Amazon so great. And you’re really decreasing the ability for new competition to come in.

Actually one last flaw – sorry, that I didn’t mention –

CAMERON YODER:
Yeah, yeah, yeah.

CASEY GAUSS:
– is basically because of the current state of the review system, one, it’s so difficult to get, but two, it is, in a lot of markets the currency to doing well or selling at market potential. People, sellers are going to these black hat methods of driving reviews, and generally in this kind of scenario it’s really just an arms race of, hey, there’s a new tactic of getting around reviews and being able to drive black hat reviews. So then Amazon is just incentivized to figure out that tactic and then put some safeguard in place. I mean it’s anything with internet security you build a wall, and then someone builds a bigger ladder, and then you build a bigger wall, and then they build a bigger ladder, or they find a crack in that wall, you patch it, and then they find another crack, and then they patch it, and so it’s this arms race. And then on the consumer side it’s leading to reviews that you cannot trust. And so it’s crazy. I don’t think that there’s one end all solution for that. I think that’s just a feature or function of any kind of market.

CAMERON YODER:
So okay, we’ve kind of broken down what the current system is and how it is impacting everything right now and its potential for impact even a couple years down the line. But, Casey, what do you think is going to change? Like what – if this would continue, obviously the effects would be crazy, just crazy bad for sellers and buyers, I think, as a whole and just the market as a whole. So what do you think is going to change? Based on what we’ve seen, based on the data that we have and based on this prediction of the future, what do you think is going to change?

CASEY GAUSS:
Yeah, great question. So going to what we see as potential fixes or solutions, you know really I think that the biggest one is I would expect Amazon to move to a rolling 12-day review quantity.

CAMERON YODER:
12 days?

CASEY GAUSS:
Oh, sorry, no, no, no. Sorry, I got that from 12 months because they do that already. So thanks, Cam.

CAMERON YODER:
That’s a quick review turnaround.

CASEY GAUSS:
Yeah, no, I would have kept going. So I – 12 days, wow.

CASEY GAUSS:
The voice of reason over here. No, so I think that what we would see is, you know, let’s say a review was left on December 31st at, in 2016. Well, December 31, 2017 that review is gone, but any new reviews left that day. So it will be a rolling 12 months, and kind of the reason behind that – so some other possibilities is Amazon could go to kind of LinkedIn’s style and say oh, you have 1000 – this product has 1000+ reviews. So if you have 50,000 reviews, still at 1000+ reviews. And that way basically I think that that would potentially be a good indicator because essentially what that’s saying is 1000+ people have verified that the review rating is just, is correct, and you will like this as well.

CAMERON YODER:
Do you think that would be cut off at 1000, or not necessarily?

CASEY GAUSS:
Oh, some number around 1000. Maybe 1000 is fairly arbitrary, but I think –

CAMERON YODER:
Sure.

CASEY GAUSS:
Just from my –

CAMERON YODER:
Just generally a large number.

CASEY GAUSS:
Yeah, yeah, yeah, generally a large number and yeah, so LinkedIn does, if you have 500+ connections I imagine they did some math around average connection – I have no idea what the math was, but they went and looked at the data and came up with that. I don’t think 21 is like, yeah, 21+ reviews. I don’t think so. Anyways, or again, they could go to the rolling 12 months. And the reason for my suspicion in the rolling 12 months is simply because they’re already doing that with seller feedback. And so they’ll show lifetime feedback, but they’ll show feedback over the last 30 days, 90 days and 12 months.

CAMERON YODER:
Right. So here’s kind of another question then. Do you think, so the rolling 12, again, do you think that those reviews, the value of those reviews will still stay in the system, or do you think they’ll be wiped completely clean?

CASEY GAUSS:
Yeah, that’s a good question. Maybe they’ll have a lifetime, but I just really think that on the listing, especially in the search results, you have to show a lower quantity because as it accumulates that’s how people are making decisions to go click into a listing.

CAMERON YODER:
Right.

CASEY GAUSS:
So they’re not even starting a session. If you have 20 reviews and everybody else has 5000 you’re not even going to get the session count a lot of the time because people are not willing to, you know, even look into it. They’re not even considering it.

So yeah, to answer your question, I’m not exactly sure. I think it would potentially – I don’t know. I think it would be potentially cool to have, you know, lifetime review quantity. But it could potentially also be misleading.

CAMERON YODER:
It would be – it would be very interesting to, let’s say this was implemented, to track how many reviews people on page 1 in big markets have and how many reviews would be dropped, right, because I mean sometimes sellers tend to have these huge influxes of reviews, which would then be wiped clean after a certain period of time passes. And so whether it’s – I mean whether it’s black hats or non-black hat activity that gets those reviews, people that have gained a significant number would have potentially, potentially, would have those numbers wiped out clean from those big, big groups or.

CASEY GAUSS:
Yeah, I actually like the – now that we’re talking about it I think I actually like the 1000+ kind of idea –

CAMERON YODER:
Yeah, yeah.

CASEY GAUSS:
– because like, again, if someone is doing some black hat activity around generating reviews, well again, in 12 months maybe they go get –

CAMERON YODER:
More.

CASEY GAUSS:
Yeah, 30,000 reviews.

CAMERON YODER:
Yeah, they can get more, right.

CASEY GAUSS:
This guy is so popular, blah, blah, blah.

CAMERON YODER:
It’s so hard to get reviews, especially when your reviews are wiped clean, and this guy has more.

CASEY GAUSS:
Yeah, exactly.

CAMERON YODER:
It’s like –

CASEY GAUSS:
And I mean so right now let’s say it takes a long time to drive reviews over time for this smaller seller. You’ve been working for the last 12 months to get these reviews. You’re finally at 100 or something like that. Well, a lot of them are now being removed, and so you’ve got to keep up this pace and continue to accelerate it to stay above this mark that you’re at. I don’t know. I don’t know if I like that. Anyways, I think that that’s potential. I also think there is potential for Amazon removing unverified reviews as a concept –

CAMERON YODER:
Interesting.

CASEY GAUSS:
– or at least for products that weren’t purchased on Amazon. So I do think that we could see unverified reviews in a sense that hey, this was bought at a promotional price, so we know that the person actually bought it and they did leave a review, and the unverified reviews that come from people that haven’t bought the products, I could definitely see those being removed. Again, Amazon doesn’t necessarily need to bootstrap their review system anymore. They have –

CAMERON YODER:
Because they’re huge.

CASEY GAUSS:
Yeah, they’re massive. And so I think there’s one, just inherent trust in Amazon as a place to buy products. And so a lot of people still think that you’re buying from Amazon, and they’re saying oh, I bought this from Amazon so I don’t think that, you know, reviews matter as much because I trust the Amazon experience. Anyways, that’s a little side tangent, but so – and I could easily – I just think that there’s a lot of problems that are arising in the black hat world coming from these unverified reviews. And so –

CAMERON YODER:
Well, it’s so hard. It is so hard for a company like Amazon, or anybody, to track black hat activity in some cases, right?

CASEY GAUSS:
Yeah. Oh, for sure.

CAMERON YODER:
Instead of just trying to implement a system that tracks all black hat activity 100% accurately, this system, the system of the LinkedIn reviews would in a way kind of level that playing field and, in some cases, again, negate the effects of black hat activity, which I really like.

CASEY GAUSS:
Yeah, exactly. And so let’s say you have some big brand that now wants to come list their products on Amazon. Well, just make an exception for those big brands. And so anyways I think you could just create an extenuating circumstance for those guys and allow them to come list some unverified reviews on Amazon to give some social proof and get things going.

CAMERON YODER:
Do you think – here’s a random question. Casey, what do you think – do you think Amazon is going to take anything with the early reviewer program further? Do you think that’s a test for something down the line, or do you think they’re – it’s just an initial beginning number of reviews?

CASEY GAUSS:
Yeah, a few thoughts there. One, I would love to see that because the early reviewer program, five reviews is not anything.

CAMERON YODER:
It’s not a lot, nope.

CASEY GAUSS:
I mean it’s better than nothing, but it’s not very much.

CAMERON YODER:
Right.

CASEY GAUSS:
Two, probably not looking at how they’ve handled the Vine program. Vine program is not very good. It’s very expensive. It’s just not a very good program.

CAMERON YODER:
No.

CASEY GAUSS:
And they haven’t done much to improve it. But then third is well, actually you know on the third-party side, especially for brand registry, they’re doing a lot. And they’re moving very, well, pretty quickly. And so I could see it happen because it seems like the team behind brand registry or however they divvy it up, they’re spending more time.

CAMERON YODER:
My mind just went to the inclusion of brand registry in future programs and how brand registry could be affected by a change in reviews. And that’s just where my thought went. But just was curious.

CASEY GAUSS:
Cool, guys. So yeah, next, just wanted to talk a little bit about what this means for you as a seller. So one interesting kind of notion, again, I’m not in the business of buying Amazon businesses, so I have limited perspective here. You know, I had no – I have some friends that buy Amazon businesses, and you know, I have talked to many people that have sold their Amazon businesses. And right now, you know, I kind of think that going back to the notion of review quantity being the barrier to entry and the way that the current review system is now, I feel like brands are a little undervalued, at least brands that have good review quantity are a little bit undervalued.

Again, looking at – let’s take some beauty brand that has good review quantity in, you know, for 20 different products. It’s very difficult to come up and get that same review quantity. And because they have the review quantity they’re selling well, which means they’re driving reviews faster than those who don’t. And so it’s this vicious cycle of these guys have good review quantity simply because they’ve been there longer than everybody else, and they’re ranking well, and they’re selling well. So they’re continuing to drive reviews faster, and basically they’re continuing to increase their barrier to entry. And that increase is accelerating day by day.

And so buying those brands that have that review quantity, if Amazon were to never make this systemic change that we’re talking about, that’s a major advantage that you get to have and continue to build on. And as more people come and buy from Amazon, you have this barrier to entry that people can’t overcome, and Amazon is automatically or, you know, they’re incentivized to drive more traffic to your listing just because they want more customers coming.

So I think that people are kind of undervaluing their Amazon businesses, and in these markets if you have a considerable review quantity it’s a hard decision to make, but I am kind of an advocate of you keeping your business for a little bit because I think it will continue to increase in value. With that said, though, if Amazon is going to make this systemic change in the next year, well now is the time to sell, given that, because the barrier to entry will be reduced quite significantly depending on how they, you know, roll out this systemic change. And assuming it does, but your barrier to entry or your competitive advantage will then decrease, making your brand less valuable than it is now, at least from my perspective, of course. And so just be aware of that when making decisions or plans for your kind of long term. Do you want to sell? If so, when? And just kind of know what’s going on there.

CAMERON YODER:
Well, hey, we want to thank you guys so much for tuning in again. Really, we so much appreciate you listening to this podcast, and of course we do this all for you. So if you really liked what you were hearing today or just any time at all, or if you have any questions –

CASEY GAUSS:
Or feedback –

CAMERON YODER:
– or feedback.

CASEY GAUSS:
– or have any or have any conflicting thoughts, thoughts on our thoughts, we just love hearing people’s perspective, so please share.

CAMERON YODER:
Please share, and let us know. You can write us at Facebook. You can call in. Our number is 317-721-6590. Drop us a voicemail. We would love, love, love to hear from you.

 

Follow the Data Episode 7: The Success Mindset and the Silver Bullet

Many courses, gurus, and purportedly high-level sellers promote their latest tips and tricks as the way to find success as an Amazon seller. But is chasing after every Silver Bullet really benefitting your business? Join CEO Casey Gauss and co-host Cameron Yoder as they explore what sets the most successful sellers apart from the rest.

Follow the Data Show Notes

  • Delegating tasks so that you can focus on your overall strategy is an important part of running a successful Amazon business. Check out The Entrepreneur’s 7 Rules for Entrepreneurs to Delegate Effectively
  • Don’t skimp on your product listing. Whether you do it yourself or hire a professional, make sure you’re getting full keyword exposure. Follow our Lead Listing Specialist’s keyword research methods to ensure you’re getting all the relevant keywords for your product.
  • Just getting started as an Amazon Seller? Make sure you’re learning the basics. Here’s a quick rundown of Seller Central
  • Want to be on the show? We’re working on an episode that features you! Leave us a voicemail at (317) 721-6590 with stories or questions about your Amazon business.

 

Podcast Transcript

CASEY GAUSS:

The idea that you can make quick money on Amazon is intoxicating, but many sellers misdirect their focus and don’t end up capitalizing on the incredible opportunity that Amazon provides.

CAMERON YODER:

In order to be truly successful you have to skillfully leverage your time and resources for maximum output.  I’m Cameron Yoder.

CASEY GAUSS:

And I’m Casey Gauss, 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 24,000 product launches in our experience working with 5500 brands to help you understand the big picture when it comes to Amazon, and most importantly, the best practices for success as an Amazon seller.

CAMERON YODER:

In today’s episode we will examine the silver bullet mentality and the get rich quick language that have kind of saturated the Amazon seller community since its inception.  We’ll talk about how this preoccupation with the easy life can work to your advantage and to your disadvantage.

CASEY GAUSS:

Finally, we’ll discuss the mindset that sets the most successful sellers apart from the rest and how you can make your business more profitable by changing your business outlook.

CAMERON YODER:

We’re going to talk about something today that we’ve kind of touched on in previous episodes, which is this common mindset in the seller community that there is a “silver bullet” to success on Amazon.  So all right, Casey, what do we mean by the silver bullet?

CASEY GAUSS:

So the definition of silver bullet is a noun, something that acts as a magical weapon and solves a long-standing problem.  So really, you know, in the seller community everybody is looking for that magical weapon, that one thing that is going to skyrocket their business, and you know it’s kind of like this excuse to not do everything else well or to skimp on kind of everything else that they’re doing because they have that silver bullet or there will be that silver bullet.

CAMERON YODER:

It’s like a quick fix, right?  It’s like that next hack or that next quick fix that they’re looking for.

 

CASEY GAUSS:

Yeah, no, exactly.  And, you know, I – so I personally feel kind of lame sometimes when I go to these conferences and get up here and talk because what I preach is that there is no silver bullet, and really the thing that works the best is to just do everything really well.  Nobody wants to hear that.  Everybody wants that hack.  They want that silver bullet.

CAMERON YODER:

Because it’s not as sexy, right?  I mean some hacks just sound more sexy than others, than other things like oh, like honing in on your basics, right?

CASEY GAUSS:

Yeah.  Oh, you can double your business.  You can grow your business by, I don’t know, 50%, 30%, month-over-month if you just did this one thing.  And you know to be honest if that one thing, if we had to boil it down to one thing, that one thing is to just do everything well.

CAMERON YODER:

Right.

CASEY GAUSS:

Don’t cut any corners.

CAMERON YODER:

And honestly this mentality is not necessarily one that’s specific to Amazon.  Like this is not a new thing.  I mean pyramid schemes I guess are kind of maybe something like that, but in business in general this mentality has been present.  So it’s not a new concept.  It’s just kind of pervasive in the Amazon community.  But I’ll read the definition again.  I’ll read the definition.  So the definition again of a silver bullet is, again, something that acts as a magical weapon and solves a long-standing problem.  So Casey, in, relative to the Amazon community, what are some specific examples of what people would or might think of as silver bullets?

CASEY GAUSS:

I feel like generally the silver bullet is, you know, for any one particular seller the silver bullet is that thing that you’re not doing, right, because it’s so easy to see the grass as greener on the other side kind of, having that kind of mentality.  And so it’s like I bet if I did this thing then it would solve all my problems, double my business, blah blah blah, while in reality you’re having all these customer service issues, you’re having all these returns and your business is maybe downward spiraling or just not increasing in the capacity that you would expect.  So yeah, I mean increasing BSR is one, you know we’ve already talked about BSR.  We’ve already, you know, but that is definitely one area.  Everyone, so it’s something new all the time, and I think we’ve talked about this other podcasts as well.  So for a while the silver bullet was enhanced brand content, and then it was backend search terms.  And, you know it’s –

CAMERON YODER:

It changes.

CASEY GAUSS:

Yeah, it’s always changing.  But the thing that isn’t changing, the thing that is going to be here to stay is the fact that if you’re not cutting corners you’re going to be doing so much better than cutting corners to get to that quick fix.  So you know, if you want to break it down to where are the areas that people are most often or most frequently cutting corners, that is in product photography.  So we see the most insane photos where people are just using their cousin’s aunt, or I don’t know, somebody

CASEY GAUSS:

Anyway, you’re looking, you know, for your Uncle Herb or something that has a camera to come shoot your stuff, or you are doing it with your iPhone.  Granted, yeah, iPhone cameras are great –

CAMERON YODER:

It’s not bad yeah.

CASEY GAUSS:

– but are they great for product photography?

CAMERON YODER:

No.

CASEY GAUSS:

No.  And as the bar, the standard of product photography continues to increase in your market the iPhone photos are going to work less and less.  So anyways, product photography, people are always cutting corners.  They’re always trying to Photoshop in some just terrible photo, some stock photos, and people just aren’t willing to spend the money there.  People aren’t willing to spend the time or the money in doing their keyword research, in building a great listing.  People are too willing to cut corners on product quality, like I have so many people that ask me all the time – it doesn’t matter if these sellers are doing $1000 a month or $20 million a year.  I promise you these guys are coming to me and saying, you know, let’s be honest, how important is product quality?  Do we need to test the samples, or are we just good to go?  And when you cut corners on product quality it’s going to come back and bite you.  It’s going to limit your ability to have long-term success because it doesn’t matter how much black hat activity you do for reviews.  You’re still going to be getting a ton of negative reviews from organic sales, and –

CAMERON YODER:

People will know.  Like people will know.

CASEY GAUSS:

People aren’t going to come back and buy your product.  They’re not going to recommend it to friends and family.  You know, nor are they – maybe they’ll return your product, and now you have higher returns, and maybe that listing gets shut down.  Whatever.  That is one area where people are cutting corners an insane amount: product quality.

 

People are always cutting corners when it comes to your review funnel, so not setting up a killer email follow-up sequence.  Like you have to spend time on these things.  If you’re like oh, reviews are just going to come.  If people like it, they’ll review it.  Well, now you’re putting yourself in a significantly worse position when it comes to competition because now your reviews aren’t going to be increasing as quickly as your competitors, meaning your competitors are driving more sales, and they’re getting a higher review percentage from those sales, putting you further and further behind.

And so there’s no hack.  There’s no this one thing that is going to significantly increase your sales, especially assuming that you’re not doing everything really well.  So yeah, you can run a promotion to get on page 1, but if you don’t have great photos your conversion rates are not going to be that great.  The number of people that click into your listing from search results isn’t going to be that great.  If you don’t have a great, well-composed listing backed by great keyword research, well when you run that promotion you’re not going to rank for nearly as many keywords.  You may have to give away more units to rank as well because maybe your main keyword isn’t in your title.  If you’re not putting in the time, it’s going to throw off literally all other elements of the Amazon selling journey.  And so cutting corners on literally any one element makes all other elements that much more difficult, making it that much more difficult for you to find this, you know, proverbial silver bullet to significantly increase your sales.  So it doesn’t matter if you’re on page 1 if you’re not doing everything else really, really well.

CAMERON YODER:

It sounds so backwards to suggest the basics when something sexy like a hack or a fix is so hot right now.  But honestly, it’s kind of sad that what isn’t being talked about or the advice that isn’t being given to people is to really hone in, as you said, hone in on the basics and just get them solidified as you expand your SKU count, right?  Like what’s being talked about right now, what the advice that being given is, is to focus on these hacks that are starting to pop up, when in reality – and this is why we talk about, why we mentioned it so much – but to focus on those basics.

CASEY GAUSS:

And really what the hacks do a lot of the time is – they may seem cool.  They may seem sexy, but a lot of the time you see hacks like helping you grow your business by 5%, 10%, maybe a little bit more.  Let’s say you’re selling $50,000 a month on Amazon.  Well, and you have five products.  Well, the fastest way to get to $100,000 is to launch five more products.

CAMERON YODER:

Right.

CASEY GAUSS:

And doing all those things really well.  And again, you know, I know that you don’t have that much time, but that means you need to build the process that includes adding people to your team or hiring VAs, whatever.  You need to build a process so that every product that comes through your system has no choice but to go through this process where no corners are cut, everything is done well.  And those corner cutters that may be getting away with it now, as more and more competition comes in more sophisticated players are going to come in and be competing against you, and these are people that will not be cutting corners, and that is going to put you at a serious disadvantage.

CAMERON YODER:

Being able to step back and say okay, what are the most important aspects of my business allows you – for each of your SKUs – allows you to really hone in on what’s important.  And like you said, when you make that plan for each of your products, then your focus is not tempted to shift towards those hacks or those cuts, but instead they’re shifted to solely focus on what’s important with each of your SKUs.

CASEY GAUSS:

Yeah, and going back to Cam’s earlier point, you know, why are the gurus or the people with audiences always talking about hacks?  It’s because if everybody just got up there and talked about the basics no one would listen, you know? Like we want to hear oh what’s this cool new thing that can help me grow my business?  That’s great, but I just feel like these gurus are so incentivized to put so much emphasis on them because the cooler their hack seems, the more people that are going to listen, the more it’s going to get shared, the more people are going to revere that course leader or whatever as this master of Amazon because they knew something that you didn’t.

CAMERON YODER:

Sometimes when sellers are looking for or implementing these hacks they’re not even necessarily like seeking to cut corners on everything.  They honestly believe that it will help improve their business, right, that it is worth the time – because again, it’s what everyone’s saying.  Everyone’s saying to focus on these things, on these subjects.  And so from a –I’m putting myself in the mind of a seller right now.  It’s like okay, well if this is my community and my community is telling me to do these things and I believe that each of them are selling well, then I want to do that, too, right?  And so I’m going to implement it myself because it’s what everyone else is saying to do.  But in reality, again, they’re kind of just going forward with these hacks without questioning them, without saying okay what’s really important here.

CASEY GAUSS:

Yeah, for sure, you know at the end of the day the people – there’s thousands and thousands of people that take ASM or these other Amazon seller courses, and they don’t end up having success.  And the people that end up going on to have the greatest degrees of success are the people that are willing to, you know, really think about things for themselves, really try them, see what the data shows them from these tests and basically, you know, again, just distilling out what they hear down into these are things that actually work.  And kind of what Cam is talking about to another degree, one thing that’s really, really frustrating is in the Facebook groups it’s really the blind leading the blind, right?  So some –one thing that you don’t see is how much money or how successful these people giving you advice really are.  I’ve seen it a million times where someone is giving like just terrible advice, and then I go look at their account and they’re doing like, you know, $4000 a month, and this guy that he is giving the advice to is actually doing, you know, $20,000 a month, and they don’t understand kind of who has more experience in this area or who knows more than whom, and it just leads to bad decisions.  So now this guy that is doing $20,000 a month is taking advice from somebody who has significantly less experience and is probably going to go implement this bad tactic or this, whatever, go employ this bad advice.  And he doesn’t know it’s bad advice.  And he isn’t able to qualify who is giving that advice because there’s no indicator of that person’s success.

CAMERON YODER:

So let’s move on to another question.  Why are – why do you think sellers in general are really chasing after these hacks, these quick fixes, this silver bullet?  What do you think sellers are really after?

CASEY GAUSS:

Yeah, to answer your question, sellers just want to have as much success as possible, and they’re looking for the quickest path to get there.  I mean I think we all are.

CAMERON YODER:

Makes sense.  Makes sense.

CASEY GAUSS:

You know, but I think if you take a step back it’s so easy to focus on how much – what is my revenue today, what is my revenue tomorrow, how can I make sure that I have more sales tomorrow?  And in reality what you have to think about is what is the quickest path, the shortest path to success in the long term?  So what is my goal really?  Is it to sell for $1 million?  Is it to sell for $10 million?  Is it to get into retail, to merge with this large CPG company and exit for $50 million, or maybe even nine figures?  Really you need to take that step back, really conceptualize where you want to go, really think about what are my dreams, what do I, in an ideal scenario, what am I able to achieve?  And I think a lot of the times people just sell themselves short for that quick buck.  They’re like, oh you know, if I do this thing I could probably go from $10,000 a month to $30,000 a month.  And in reality, like you need to be making those decisions that aren’t necessarily going to take you to $30,000 a month next month, but are going to set you up to do $1 million a month in a year, whatever.  You really need to be thinking about the long-term because if you’re always making these short term decisions, you’ll only get that short-term benefit.  And so –

CAMERON YODER:

You brought up a really good point about people’s dreams, people’s goals.  I don’t think that you as a seller should let someone else tell you what your goals or what your dreams are or should be, right?  I think that process should be something that you sit down or you take some time, at least some time to sit down and think about.  Again, as that is your solid base.  That is your foundation.  And as you come across different data, or different hacks, or different tips, then you can kind of apply them to okay, is this part of my goal?  Is this what I want to do?  And is it going to work, or is it a part of – again, is it a part of those basics, or is it taking away from those basics that are going to bring success for me?  So part of an answer I think to the silver bullet is analyzing – or part of that answer comes from analyzing sellers that have been successful, have had a lot of success and kind of breaking down why, I guess.  So Casey, you’ve been able to meet and just be with a lot of successful sellers in the space.  And so when you look at successful sellers in the Amazon space with the idea of a silver bullet, what do you see?

CASEY GAUSS:

Yeah, so just to give some light into some of our friends that are, you know, really successful guys, so a couple friends of mine, they’re brothers, they last year did just under $100 million on Amazon.  Outside of Amazon they actually do bigger numbers.

CAMERON YODER:

They’re killing it.

CASEY GAUSS:

Yeah, it’s just insane.  They’re really young guys.  They’re actually under 30.  It’s just incredible.  And you know, my wife and I, we got the privilege of going to one of their weddings.  We get invited to kind of their big family events.  Another friend of mine, they do, last year I think it was just over $50 million across.  They have a few different accounts, and, you know, been to – he’s in Atlanta, been to like their version of SeaWorld or whatever, the biggest aquarium in the US.  Anyways, so we just get the opportunity to rub shoulders with some really, really big sellers.  And so yeah, plenty of guys that are in the like $20-$30 million range.  Not too many people make it outside of there from my experience so far.  But anyways, you know, again, these guys are really focused long-term, and I would say that possibly one of the areas that has allowed them to get to where they are the fastest is just having the framework in terms of the team structure in place to allow them to really scale.

You know, it’s very, very difficult if not impossible for a one-man shop to go to $50 million a year in sales on Amazon.  That’s so much inventory that you’re going to have to move.  And so these guys just have, they have it all down.  They have a very, very streamlined process of I’m going to launch this product.  Here are the people on my team that are handling each of these scenarios.  They’re outsourcing for various things that make sense, where again, they’re just focused on efficiency because doing that kind of volume you have to have, you know, the economics to make sense both from a time perspective and financially.  And again, these guys are also launching tons of products. So let’s say your maximum sales potential in a particular market is 1000 units a month.  And let’s say you’re at 800 units a month.  Well, you know, that’s pretty much there. That means it’s time to go focus on the next product.

So the time that it’s going to take you to go from 80% to 100% of maximum sales potential in a market is not worth the time.  You can take that same amount of time and go launch another product up to that 80%.  Again, should you settle for being in the middle?  No, but you should have a system in place that is designed to maximize sales for that product, based on that market’s potential and move on.  You should not, again, be spending your time focused on going from 80% to 100%.  That’s where people get caught up.  That’s where the big guys don’t worry about it so much.  Like they have the people in place that are focused on going from 80 to 100.  You need to be focused on the bigger picture, how many products can I launch, how quickly can I get them up and running, and how can I align my team and my team’s focus in like the entire products process or the whole launch process from going from nothing, from concept to launch?  That’s where you need to focus.  That’s where these big sellers are focused.

Again, they’re not cutting corners.  They’re not focused on the hacks.  You know, some of them have been involved in some black hat activity at some point, but really they realize that these are like, for the most part short-term solutions to these big problems, and again, you know, doing black hat stuff if you’re small and not doing it at scale, you may be getting away with it now, but if you’re doing it on 100 X more products or even 10 X more products, you’re – that significantly increases the likelihood of you getting caught.

CAMERON YODER:

Of course.  I think, Casey, I haven’t spent as much time with these guys as you have.  I have been able to spend a decent amount of time with successful just business people in general outside of Amazon, and some people in Amazon itself.  And from the perspective of the get rich quick mentality, I see a lot of people implementing the positive aspects of that mentality.  I mean there are positive and negative aspects to the get rich mentality, of course, and some of the positives that I see these successful people pushing or just naturally emphasizing are things like competition, or discipline, or innovation or speed.

CASEY GAUSS:

Or hustle.

CAMERON YODER:

Hustle.  Like hustling, these guys are implementing all of these things, and they are doubling down.  They look at what is bringing them success, and they double down on that.  Like they are very aware of themselves.  They’re very aware of what they’re capable of, what they’re not capable of, bringing people on to fill in those gaps, and then just doubling down on what’s bringing them profit.

CASEY GAUSS:

I agree.  A couple points, going back to previous questions, one area the people always cut corners on is design aesthetics.  You need, you absolutely need to have killer labels if you have labels on your product or packaging because it makes all the difference.  Go check out, you know, go check out some of the big supplements like testosterone boosters, stuff like that.  You will see Zhou Nutrition.  One, they rank for everything.  They’re absolutely killing it.  But they have incredible – their aesthetics are awesome.  There’s cohesion across their line so if someone goes and buys, you know, a neuro booster as well as a testosterone booster – or let’s say they go buy this testosterone booster.  They happen to buy Zhou’s, and they love it.  Well, when they go buy some other ancillary product or something that makes sense, or maybe it doesn’t make sense but it’s a supplement, and they see that same packaging like aesthetic, well they already love Zhou’s testosterone booster so now, yeah, they’re going to buy that.

CAMERON YODER:

It’s brand recognition.

CASEY GAUSS:

Yeah, yeah, yeah.  And so anyways, the aesthetic is so critical.  You know, and again we’ve talked about this before.  It’s easy to think that yours is good because, you know, you’re emotionally biased and yeah, it’s definitely a subjective kind of metric, but definitely you need to make sure that you’re killing it on aesthetics.  And then going back to why looking at the long-term helps you to avoid these hacks is, when you’re focused on these hacks you’re like zigzagging from here to there, to here to there, but when you have this broader perspective of where I want to go and what that looks like at the end result it’s a lot easier to draw, you know, this linear path there. So looking at product photography as an example, let’s say I’m just hacking on product photography and I get some stuff up.  Well, as my competition five months from now springs up, well now they have better photos than me, so now I need to shoot just a little bit better photos than them or photos that match.  And then six months down the road competition now has even better photos.  Well, now you need to go and get the best product photography possible.  And so now you’ve spent time reiterating on your photos three times and – or two times, however you want to count it – and now you’re wasting all that time.  That’s more money spent in the aggregate, whereas if you would have just thrown up amazing photos right off the bat, then you would have been a lot closer to your end result when you first got started, and you weren’t zigzagging.

CAMERON YODER:

I would like to ask – I like to ask people the question, if you had the choice of being the best in the space that you’re selling in, would you do it?  I mean of course, of course we all want to be the best in the space that we’re in.  If we had the choice we would all do it.  And so if that’s the case, then why wouldn’t we spend time just right off the bat having the best photos, or the best listing, or the best review follow-up?  All of it connects, and all of it makes your products just the most likely to sell right off the bat.  

CASEY GAUSS:

Thanks for joining us this week on Follow the Data.  If you’re interested in learning more about how to avoid cutting corners to help you achieve your long-term dreams subscribe to the podcast and check out the Viral Launch blog at viral-launch.com.

CAMERON YODER:

Also, huge thank you to those of you who have called in with your questions and comments about the show.  We are hard at work on an episode that could feature your voice, so just leave us a voicemail and tell us your thoughts on today’s episode, or really just ask us any of your Amazon questions.  Our number is 317-721-6590.  It’s always posted in the show notes for you to find when you’re done listening.  So feel free to give us a call.  We actually would really love to hear from you.

CASEY GAUSS:

Until next week, remember, the data is out there.

 

Follow the Data Episode 5: Diversification

Selling your product on Amazon alone is a bad business model. Or is it? Join Viral Launch CEO Casey Gauss and Amazon Seller Coach Cameron Yoder as they discuss whether diversifying your business efforts across multiple ecommerce platforms is really worth it.

Follow the Data Show Notes

  • Amazon is the go-to online retailer today, and Prime shipping is a huge incentive for shoppers. According to RetailWire, “The average Prime program participant spends $1,300 per year,” and Prime membership is only increasing, which means the potential for third-party sellers continues to grow.
  • Check out this recap of 2016 Amazon third-party sales. With 2017 shaping up to be an even bigger year, there’s no denying that Amazon offers third-party sellers a sales opportunity like no other online retailer.
  • Another great recap from last year is this infographic by Visual Capitalist, depicting online market share.
  • Take a look at these Viral Launch Case Studies for a few examples of sellers who decided to double down on their Amazon businesses and saw huge results
  • Don’t forget to check out our redesign of Market Intelligence. With a brand new look, a built-in FBA calculator, and the most accurate sales estimates in the galaxy, Market Intelligence has everything you need to streamline your sourcing process. Check it out at viral-launch.com/newMI
  • Want to be on the show? Leave us a voicemail at (317) 721-6590

 

Podcast Transcript

Casey Gauss:                      

Approximately 55% of online shoppers start their product search on Amazon.  As an online retailer you know Amazon is the place to be.

 

Cameron Yoder:              

But is selling strictly on Amazon the most profitable approach?  I’m Cameron Yoder.

 

Casey Gauss:                      

And I’m Casey Gauss, 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 20,000 product launches and our experience working with 5,500 brands to help you understand the big picture when it comes to selling on Amazon, and most importantly, the best practices for success as an Amazon seller.

 

Cameron Yoder:              

The first four inaugural episodes of Follow the Data are all part of our Dispelling Myths series in which we explore topics that have garnered a lot of conversation among the Amazon seller community but until recently have not been proven or disproven using factual evidence.

 

Casey Gauss:                      

We’ll talk about why these Amazon theories make sense and what the data is saying about what’s actually happening.

 

Cameron Yoder:

Today we’re talking about diversification.  Now there’s this conversation happening among sellers, whether to focus solely on Amazon or whether to diversify and sell on other platforms.  We’ve heard a lot of people talk about this at conferences.  For example, some sellers are listing their products on eBay or Walmart, Shopify, BigCommerce, Squarespace or other big names  that others are talking about. But this is the conversation today.  The conversation is whether it’s worth it or not. Casey, you’re passionate about this.  Take it away.

 

Casey Gauss:                      

Yeah, so I mean it’s pretty much like public knowledge at this point that – or general consensus:  Okay, I need to diversify away from Amazon as soon as possible because Amazon is going to ruin my business.  And I totally get it, right.  So everybody assumes it is like okay, I have a business on Amazon.  I have to diversify right away.  And there’s just a lot of issues with that.  So basically – but I get it, right.

 

Cameron Yoder:              

But why do people think that right away?

 

Casey Gauss:                      

Yeah, yeah

 

Cameron Yoder:              

Why is that?

 

Casey Gauss:                      

I mean it totally makes sense.  At the end of the day if you are amazing at Google PPC and/or Facebook ads and this is just a talent that you have, then it completely makes sense.

 

Cameron Yoder:              

Sure.

 

Casey Gauss:                      

And I totally get it, right.  So the area of seller that we see this happen the most are the guys that are doing, you know, they hit that million dollar a year mark, or maybe the 1 to like 3, maybe 1 to $5 million a year mark, and then they really, really want to protect what they have.

 

Cameron Yoder:              

You’re saying diversify – like those are a lot of people that you see consider diversifying?

 

Casey Gauss:                      

Yeah, yeah, yeah.  So once they get to this mark they’re like wow, I really want to protect what I have, and so what is the biggest threat?  Well, the biggest threat is that I’m on the Amazon platform.  I don’t control the customer, which is a totally valid consideration, right?  Those are definitely – I totally see where you’re coming from.  But there’s a few issues with that.  

 

So what I typically see happen is that those sellers that try to begin diversifying – one, they’re paying all this money for these courses teaching you how to diversify, which generally don’t work.  But the thing is that people forget what got them to that 1 to $5 million a year mark, and what got them to that 1 to $5 million a year mark is launching more products on Amazon and/or really just figuring out that launch process on Amazon.  If you’re doing, you know, $2 million a year, you know how to launch products on Amazon.  And so how do you go to $4 million?  How do you go to $10 million?  Well, you just launch more products through that same exact process you’ve already established.  The answer is not to go and diversify.  Anyways, so –

 

Cameron Yoder:              

Well do you think having – do you think having a presence on these other platforms does contribute to extending your – as other people would say – brand reach?

 

Casey Gauss:                      

Yeah, so I think that you should have at the very least a Shopify store.  I think that you should go and have – you should have somebody on your team go and list your products on these other platforms.  I mean just by happenstance, you know, if you are the only vitamin C serum – which isn’t the case – but if you’re the only vitamin C serum on Walmart, yeah, you’re going to get some traffic.

 

Cameron Yoder:              

Sure.

 

Casey Gauss:                      

Right?  But you – I don’t think that you should be consid — spending a considerable amount of time on these other platforms.  But again, we’ll get into that –

 

Cameron Yoder:              

Sure.

 

Casey Gauss:                      

– in a minute.  So basically at the high level people want to protect what they have.  I totally get it.  There’s a lot of gurus that are pushing for people to diversify.  We’ll get into that in a minute.  But again, you know, if this guru that is, you know, absolutely killing it is telling you that they’re doing this or that you should be doing this, no, you know I totally understand why you think that.  And again, logically it makes sense.  Okay, I’ve had this success on Amazon.  People like my brand or whatever.  Brand is in quotes.  Then like I will be able to go and replicate this in these other platforms.  And the answer is just no.  It just doesn’t happen that way.  So, yeah.

 

Cameron Yoder:              

Let’s take a look at – so one main aspect of what other people are saying in this argument for diversifying is that a seller can control the buyer experience more, right?  So in Amazon – you touched on this at the beginning, but when a seller is on Amazon the control of the buyer experience is not – it’s not that much.  You can’t control it as much as you would in your own website, for example.  So people, again, are saying, right – and correct me if I’m wrong – but people are saying that oh, my argument for diversifying is that I can control my buyer experience.

 

Casey Gauss:                      

Yeah, and I totally get what you’re saying, but my answer to that is, for how many people, right?  Oh yeah, you can go and control the conversation for 100 new customers a day.

 

Cameron Yoder:              

Right.

 

Casey Gauss:                      

But I’m going to go sell 5000 units a month on Amazon, right?

 

Cameron Yoder:              

Right.

 

Casey Gauss:

The problem is yeah, you get to control the buyer experience, but for how many people?

 

Cameron Yoder:              

Yeah.

 

Casey Gauss:                      

You know what I mean?  Like sure you can have control of 100 people a month that are coming and visiting your Shopify store or that you’re paying an insane amount of money to get to your Shopify store or wherever.  But I’m going to be on Amazon selling 5000 units a month while you’re selling 100 units a month on Shopify.  We’ve seen, you know, we’ve seen this happen so many times where basically sellers, they’re doing really well on Amazon.  Again, these are the guys doing that 1 to 5 million, sometimes a little bit more, but then they try to diversify.  They try to get into retail, or they try to push heavily into Shopify, and they spend all of their time or a good portion of their time not growing their Amazon business.  And so what happens is yeah, maybe you grow revenue by 5% or something, but what we see happen a lot of times is in the meantime their Amazon business starts to lose traction.  It starts to lose market share. They get out of tune with what’s working.  And they’re just, you know, out of touch.  And so competitors just start to pass them by.

 

So yeah, they started making a little bit extra money on their Shopify store or whatever, but they’ve really started to lose out on their Amazon business.  They are trying to avoid the very situation they end up creating, which is they are trying to protect their sales for the long-term by diversifying, and calculating opportunity costs they lose out on sales in the long term.

 

Cameron Yoder:              

Right.  Other arguments that people have, which I think there is kind of one main answer and you already touched on it to all of these, a couple reasons that sellers opt into listing on different platforms, there’s a pretty comprehensive list.  One is a lower barrier to entry.  So again, Walmart is an example.  Walmart has a much lower barrier to entry than Amazon.  There’s less competition. There’s no monthly fees or startup fees, lower listing or product fees, and you own your own storefront, right?  But, but like you said, I feel like all of these arguments can be honestly just like crushed with the fact that all of the traffic is on Amazon.

 

Casey Gauss:                      

Yeah, okay.  Lower product fees, okay, yeah.  I’ll pay – versus paying let’s say it costs $5 to ship my widget and sell on Amazon.  But it only costs $1 to sell on Walmart.  No, that’s great, but you’re still only selling 100 units.  And so –

 

Cameron Yoder:              

But dude, you don’t have a $35 monthly fee.

 

Casey Gauss:                      

Those things just don’t make sense.  So really I mean we’ve worked with over 5500 brands.  I have really good relationships with guys that are doing 100 million a month.  Whoa.

 

Cameron Yoder:              

Holy –

 

Casey Gauss:                      

100 million a month would be insane.

 

Cameron Yoder:              

I’d like to meet them.

 

Casey Gauss:                      

Yeah, me too.  100 million a year, 50 million a year, guys that are doing – plenty of guys that are doing around 20 million a year, and everybody in between, right?  And the thing is is I do not know – I’m not aware of any seller that has successfully taken their success on Amazon and then brought or built a considerable revenue stream outside of Amazon from their private label business.  Like it just absolutely doesn’t make sense.  These guys that have a major $35 million brand, it’s the third-largest brand in their category, in the top-level category: I’m talking cell phones and accessories or beauty or health and household.  Like these guys have the third-largest brand by volume, and their sales on their website, they’re spending – they have a huge team, and they’re spending a good amount of money trying to drive those sales on their website.  And they’re just not seeing the volume.

 

So what – you know I have some friends that they do 50 million a year, and they tried pushing on their website, and they realized it just didn’t work.  And they saw a dip in revenue when this happened like two years ago.  And now they’ve just doubled down on Amazon because they know exactly how to launch products when it comes to Amazon.  So they just doubled down on that.  

 

The opportunity is on Amazon, and if you are spending, you know, a week – let’s just say a day.  You’re spending a day out of your week trying to build these other sales channels.  Well that’s a day a week that you’re not building your Amazon business.  And so for every dollar, you know – these are arbitrary numbers, but it’s something like for every dollar you spend building your Amazon business you get $10 back, let’s just say.  But for every dollar you spend building your Shopify business you’re getting like $1.50 back.  Maybe you’re getting $2.00, but probably not.  You know, net net across your Amazon sales in everything you’re seeing maybe $1.05, or you’re seeing $0.95 out of that dollar spent.

 

And so, you know, I do think that you should diversify.  Like I said at the beginning, you know, if you have the team or you have the skill set – if you have the skill set to drive an insane amount of Facebook ads or whatever, yeah, definitely check out that model.  But you still need to run the math and calculate: Do I make so much more money when I’m spending that same amount of time and that same amount of money pushing my Amazon brand?  Well, then do that.  You know, like – and again –

 

Cameron Yoder:              

Keep on going

 

Casey Gauss:                      

So the other argument for diversifying is everybody’s afraid of getting banned from the Amazon platform, and now their revenue stream dries up.  That’s what these guys that are selling $1 million, $5 million a year, that’s what they’re so afraid of.  And the thing is is we’ve worked with 5500 brands, right, and we know of a lot more, of course, right?  I only know – we only know of one brand that has actually gotten banned from the platform, and these guys were asking for it.  Like these guys had gotten suspended so many times.  They just kept doing, you know, whatever it was that was getting them suspended, and they were pushing the envelope in every direction.  And you know, eventually Amazon said no, we don’t trust you guys to reinstate you because you’re just going to keep doing this stuff.  You guys are banned.  You guys are not able to sell on the Amazon platform.

 

And so at the end of the day, again, thousands and thousands of brands – we’ve definitely seen people get suspended, but they get pushed right back up.  And so I don’t know how legit that fear of getting banned is.  I understand why you’re afraid, of course.  I totally get it.  But at the end of the day, how likely is it to happen?  Well, according to our sample size –

 

Cameron Yoder:              

Not very.

 

Casey Gauss:                      

– one in 5500, which is pretty low. I would like to think that it’s more. And again, the thing is is sure, you can go spend a ton of time trying to diversify.  But in reality will you be successful at it?  You know, I really doubt it.  The data just does not show us in the 5500 brands that we have worked with. That it is likely that you can take your Amazon success and turn it into external success.

 

Cameron Yoder:              

I like to relate, I like to relate this subject to – and Casey, you’ve heard this before – I like to relate this, the idea of diversifying, to the gold rush, right, like the classic American gold rush where once people heard that there was a ton of gold in one place they all rushed to it, right?  I feel like Amazon is that source of gold right now. More and more people are starting to hear about it, and not that – I mean there was a limited amount of gold, right, and not that Amazon is going to run out or go out of business or anything, but the game is changing as time goes on.

 

Casey Gauss:                      

And it’s getting more difficult.

 

Cameron Yoder:              

And it is getting – it is.  It is.  The gold has not run out yet at all.  If you see this huge mine of gold that you know is there, it’s Amazon, then why would you go to another gold mine, like Walmart or Etsy, that you can’t see the gold?  Like sure there’s some benefit there, and there will be benefit in the future. I think, just in terms of taking advantage of the moment, that’s the best thing.

 

Casey Gauss:                      

Yeah, you know, I think maybe if you have that 1 to $5 million brand and you have a team, then maybe you can hire somebody that’s great at customer acquisition or digital advertising or whatever.  And they can try to build those sales, and you know, they can be compensated accordingly.  And you can have them focus on that, but what you need to be focused on is on what you know how to do really well, and that is selling on Amazon.

 

Cameron Yoder:              

Right, right.  And opportunity cost, right?

 

Casey Gauss:                      

Yes.

 

Cameron Yoder:              

Like it’s going to cost something.  If you choose to focus on another platform, it’s going to cost time

 

Casey Gauss:                      

Yeah, and again, every minute that you’re spent focused outside of Amazon, a competitor is focused on Amazon, and they’re just going to steal that opportunity or that potential from you down the road.  But I think that people are really underestimating the value of the Amazon business right now.

 

Cameron Yoder:              

Yeah, I agree.

 

Casey Gauss:                      

I think that time will show us that your brand is actually more valuable than you think.  And again, going back to Cam’s comment of reviews being the currency, like this is the way to go.  Yeah.

 

Cameron Yoder:              

It is.

 

Casey Gauss:                      

So basically to sum everything up, Amazon is huge right now.  It’s still growing.  It’s supposed to be growing an insane amount. They’re just snagging such a big portion of the e-commerce sales.

 

Cameron Yoder:              

Remember.  Remember what got you here, right?

 

Casey Gauss:                      

Yeah.

 

Cameron Yoder:              

Remember what got you here and triple down on it.

 

Casey Gauss:                      

Right.  Yeah.  So yeah, basically at the end of the day we don’t know anybody—doesn’t matter if they’re doing 100 million a year, 50 million a year—it doesn’t matter. We don’t know anybody that has successfully gone and diversified.  Does it mean it’s not possible?  No, it’s definitely possible.  But that’s not what’s happening.  That’s not where you should be focusing.  You need to be focusing on building your Amazon business.  Are we biased in saying that?  Yes.  Is it the truth?  Is that what the data is saying? Yes.

 

Cameron Yoder:              

Yes.

 

Casey Gauss:                      

Does it make logical sense?  No, not really, but it’s the truth.

 

Cameron Yoder:              

Well hey, that is all for this week.  Thank you so much for joining us on Follow the Data.  For more reliable information about what’s really happening on Amazon subscribe to the podcast and check out the Viral Launch blog at Viral-Launch.com

 

Casey Gauss:                      

And don’t forget to leave a review on iTunes if you like the podcast.  We really appreciate your feedback.  We love, love honest feedback.  We love to hear what your thoughts are.  And if you enjoyed the podcast and want other people to hear it, please share.  Reviews also help other people to understand how good or terrible of a job we’re doing.

 

Cameron Yoder:              

We’ll link to all of the information and sources that we referenced in this episode in today’s blog post.  Check out the blog and subscribe to our email list to stay up-to-date on all the latest Amazon updates and best practices.

 

Casey Gauss:                      

Want to be featured on the show?  Leave us a voicemail and tell us your thoughts on today’s episode, or ask us any of your Amazon questions.  Our number is 317-721-6590.  Join us next week when we dispel the myth of suspension.  Until then, remember, the data is out there.

Cameron Yoder:

Hey! I wanted to let you know about a webinar that Casey and I hosted last night where we made an exciting announcement. We’ve updated our product research tool, Market Intelligence, with a brand new look, easier navigation, and a built-in FBA calculator. If you missed us last night, you can find our announcement and our walkthrough of the tool on our YouTube channel. The calculator feature is super slick, essentially calculating how much it costs to break into a market showing you upfront costs, month expenses, monthly profit, and total profitability.

 

Market Intelligence offers sellers the most accurate sales estimates in the galaxy and up to 2 years of historic sales data so you can see big market trends like price and overall sales. With the newly integrated FBA calculator, this latest version of Market Intelligence really does have everything that you need to research your next product. Visiti viral-launch.com/newMI to check it out and to start your free trial.

Follow the Data Episode 3: Q4 Part II Inventory Planning & Promotions

With more people shopping on phones and tablets, your listing needs to be optimized for mobile. Then, once you’ve made your listing shopper friend, carefully planning your inventory and perfectly timing a product promotion are crucial if you want to ride the wave of holiday sales. Join Cameron and Casey as they dive into planning for Q4.

 

Listen in iTunes . See All Episodes

Listen on Stitcher / Listen on Google Play

 

Follow the Data Show Notes:

Podcast Transcript

Casey Gauss:
You need to have your ducks in a row for Q4 because this is the biggest shopping season of your career.

Cameron Yoder:
And we’re back with part two of our Q4 episode to talk about the role of enhanced brand content in optimizing your listing, how to make sure your products look great on mobile, how to predict your inventory needs and how to time a product launch to ride the holiday sales wave. Let’s get started.

Now let’s talk about enhanced brand content, EBC.

Casey Gauss:
Yeah, at the end of the day, you guys, anything that you can do to improve conversion rate, to improve – drive sales at the end of the day, you should be doing, right? And so enhanced brand content, these are things you should already be doing, but you know, our hope is that you’re really concerned about these Q4 sales and that you’re going to, I don’t know, get your house in order, whatever the saying is, in order to maximize sales for Q4. And the best way to do that is to have enhanced brand content because some of your competitors are not going to. And that’s a leg up. Or they are going to, and that’s a leg up they will have over you. So please have enhanced brand content.

Cameron Yoder:
If you aren’t brand registered yet, it’s too late right now for this holiday season, for Q4, but – unless you’re already in the process of going through the trademarks and everything. But this might be a good step for you to take if you don’t, if you aren’t brand registered and if you don’t have enhanced brand content. So basically you might be better off focusing on other things if you aren’t already brand registered this holiday season.

Casey Gauss:
True.

Cameron Yoder:
And this might be a good thing to focus on for the next year or to start the next year. Overall, basically what I like to think of is if you have your listing photos and everything else as optimized as possible this is kind of the next viable step or option to dive into.

Casey Gauss:
And honestly it doesn’t take that long to file for a trademark.

Cameron Yoder:
No.

Casey Gauss:
And just some other side benefits of brand registry, why you’d want to be in there, this is outside of Q4 unless you are in brand registry, is just the Early Reviewer Program, getting those initial five reviews, really I don’t think people value reviews enough, and this is a good way to grab some of those reviews.

Cameron Yoder:
Reviews, the reviews are like the currency of Amazon.

Casey Gauss:
Yeah, that’s how I feel. Anyways, you get your own Amazon stores. We’re still looking for the data on how important those are. Headline search ads, those are very, very powerful, at least right now, so get brand registry so you can have access to all these things. Also, enhanced brand content, we put out a blog post recently about this, but it’s also on mobile. And I think Amazon said last year 70% of shoppers used, made a purchase or ran a search on the mobile app. And so that means that more and more people are going to be seeing your enhanced brand content, and so put that out there.

Cameron Yoder:
Mobile is, in general, just another really good thing to focus on in Q4. I mean another stat – Casey, you touched on one stat – but the mobile app actually grew by about 56% last holiday season.

Casey Gauss:
Oh nice.

Cameron Yoder:
And so it’s going to grow again, I mean not 100%, I don’t know that 100%, but I’m predicting that it’s going to grow this holiday season. One other thing that I would also consider if you are, again, going through all this and enhancing your listing and photos and everything, is to go – if you don’t, or if you haven’t yet, go look up your product or products on a mobile device just to see how they look and how they feel because then if you haven’t yet you can take a look at that and see okay, if there’s this large of a percentage of people ordering on mobile I need to make sure that my stuff is optimized on mobile. And if you haven’t seen it yourself yet, then you probably should.

Casey Gauss:
Yeah, at the end of the day you need to understand how your customers are perceiving your product.

Cameron Yoder: Exactly.

Casey Gauss:
We have just a few additional things, honestly what I think is the most important or the biggest actionable takeaway coming up.

Rebecca Longenecker:
Did you ever wish you could go back in time and get into the Amazon market earlier? What if you had been one of the original sellers? Well, here’s your opportunity. Amazon is starting to ramp up in other countries. If you’re looking to get in early and launch your products in Canada, the UK, Germany, Italy, France, Spain or all of the above, we’ve got exciting news. Viral Launch is now offering international launches. Set up a promotion for Amazon Canada, UK Germany, Italy, France or Spain with the launch experts you know and trust. Stay tuned for additional countries like Japan and Mexico.

Casey Gauss:
First off, just know your turnaround times. You have very limited time to place a purchase order for – if your stuff needs to be in for Christmas. So definitely make sure that you are well aware of your turnaround time, which has got to be coming right up to the end of it. Make sure that you are aware of the trends with market intelligence, basically what we’re doing for a particular market. Let’s take candy canes as an example. This is a classic example for us. If you go search candy canes and then you run market intelligence and move over to the market trends tab, we will show you exactly when sales start to increase across the market for this particular product. So if you run market intelligence through candy canes you can see in 2015 and in 2016 when the sales started to increase, and it’s pretty awesome because you can see here’s when sales started to increase, here’s to what degree they increased, you know, what were the orders per day, how long did that increase sustain?

Cameron Yoder:
What were prices like?

Casey Gauss: What were prices like, how did prices change throughout that? And this is different than looking at Keepa or CamelCamelCamel that has all this historical data because we are showing you across the market, whereas let’s say one particular candy cane seller, if you’re just looking at their BSR history maybe they ran a promotion. Maybe they were running outside sales, and that’s why the spike happened in October instead of November when everybody else’s increased. It’s not very indicative of the market if you’re just looking at one ASIN. You need to look at the market as a whole. But this is a really, really cool feature of market intelligence when it comes to seasonal products. The same is true for Halloween. This will probably be out before Halloween. So if you run through market intelligence through candy canes, you can see in 2015 and in 2016 when the sales started to increase, and it’s pretty awesome because you can see here’s when sales started to increase, here’s to what degree they increased, you know, what were the orders per day, how long did that increase sustain?

Cameron Yoder:
What were prices like?

Casey Gauss:
What were prices like, how did prices change throughout that? And again, across the market versus seeing one guy who raised his price like an insane amount and his sales didn’t reflect that increase or didn’t help support, didn’t show that people were actually buying it at that price point. So anyways, what you need to do, go look. If sales increased on October 15th you need to have your inventory checked into FBA at least 10 days before that so that you can prepare.

Cameron Yoder:
I mean this is one of the biggest questions that sellers have around this time of the year is okay, what can I expect in terms of inventory? How much inventory am I going to need in preparation for Q4? And this is one of the best answers in predictive software that is going to let you know how much or around how much you need to order and have in place and also when you need to have it in place. Once you’ve got your holiday inventory figured out you need to start strategically positioning yourself to ride the wave of holiday sales.

Casey Gauss:
We saw people have insane amount of success when it came to Prime Day. Riding the wave is really, essentially as sales increase you need to make sure that you’re on top of that wave of new traffic or sales increase so that you can ride it. And here’s the example, right, so let’s say right now barely anybody is buying candy canes. So let’s just say those guys are doing five sales a day on average. People in top 10, selling five units a day on average. But during peak time these guys are selling 300 units a day, let’s just say. So to get ranking in the top 10 for candy canes, right now all I need to do is give away five units a day, and I’ll be in the top 10, and that’s really cheap. But if you time everything just right and you run a promotion so you are ranking in the top 10 right when that sales wave happens, right, then you will get to take part in that wave of sales increase. So when sales moved to 15 a day, well, I’m at the top of page 1, so I’m getting a bunch more sales. And then, you know, by December or whenever the peak is, I’m seeing an insane amount of sales because I was ranking at the start of it, and I just continued to maintain that rank because people continued to buy my products.

And so what we see other people try to do is let’s say with the candy canes again, by November 15th everyone is selling 50 units a day or 100 units a day. Let’s say 50. So in order for me to get ranking the top of page 1, well, now you have to run a promotion giving away 50 units a day in order to try to hit page 1. But the problem is these guys also have a great sales history, which we recently talked about. Basically the analogy is riding the wave, right? So if you run a promotion before things start, you get on top of that wave and you ride it up as sea level increases, or whatever. But if you don’t run that promotion now you are under this wave of 50 sales a day that you now have to paddle all the way up to, now catch your breath, now try to ride that wave up.

So what we saw with Prime Day is people that were – they ran promotions across their entire account, and they saw 400, this one particular person, saw $400,000 in that 24 hour period because with their 10 products or so they ran a promotion so that they were raking at the top of page 1 for each product right before those Prime Day sales kicked in. And so as Prime Day sales kicked in, they rode that wave, and they absolutely killed it. And so we really, really hope that you guys do that. Whatever your method of ranking is, whether it be Viral Launch, whether it be some other competitor, whatever your method is, make sure that you are ranking at the top of page 1 right when that wave of sales increase begins to happen because you definitely don’t want to be paddling from underneath, and you definitely don’t want to be fighting these competitors’ better sales history.

Cameron Yoder:
It’s just going to be, in the long run, kind of summarizing what Casey said, it is just going to be much easier to jump on when sales are lower but at the very beginning of when they start to pick up so that you’re visible, you’re on page 1, so again, you can ride that wave like a California surfer.

Casey Gauss:
And the research that you did to understand when those trends start to pick up is going to inform you of, okay, let’s say it’s October 15th that sales start to increase. Well, walk back seven days. Walk back five days. That’s the day your promotion needs to start so that at the end of that promotion you’re ranking page 1, and as sales start to increase you ride along with it.

Cameron Yoder:
Another good action step for this podcast is to encourage you guys to really just lay out the dates that you need to follow things through by because there are a lot of dates involved with Q4. Again, we went through the deadlines, but even more than that it’s days to make sure that you’ve run your promotions by, that you’re on page 1 by, that you’re ranking by, while taking into account the fact that you have to or should be following all these deadlines for like Black Friday or Christmas. So I would say just go lay out, whether it’s a physical calendar or a digital one, and make a strategy for Q4.

Casey Gauss:
And you have to do this for each product, right?

Cameron Yoder:
Yes.

Casey Gauss:
Because each product is going to have a different pickup date in terms of sales.

Cameron Yoder:
Right, right, right, right. There was a product whose big point of Q4 was actually after the Christmas season. So that person is going to have to plan their launches and their inventory a little differently than someone whose peak is right at that November-December point. So again, like Casey said, just go through each ASIN, each product, and create a plan individually.

Casey Gauss:
Yep, and you know, same is true, ride the wave for Black Friday, Cyber Monday. The last thing we want you to do is to come to us for, you know, these candy canes on October 15th and say hey, more people are starting to buy these candy canes. Can I run a promotion to help get ranking? Or, you know, the last thing I want to see is that happen in December because –

Cameron Yoder:
Oh, geez.

Casey Gauss:
– to ride that wave like you’re going to have to be spending thousands and thousands, if not five figures, to catch up.

Cameron Yoder:
That’s a lot of candy canes there.

Casey Gauss:
Yeah.

Cameron Yoder:
Well, that’s all for this episode. Thanks for joining us on Follow the Data, and good luck as you prep for Q4. For more reliable information about how to succeed during all four seasons, subscribe to the podcast and check out the Viral Launch blog at Viral-Launch.com.

Casey Gauss:
And don’t forget to leave a review on iTunes if you like the podcast. We really appreciate your feedback. We like to know how to be better, so we would love your honest feedback. And if you like what we’re doing, leaving a review helps other people find us as well.

Cameron Yoder:
Exactly. And if you’re wondering about how exactly Viral Launch helps Amazon sellers, make sure to check out one of our more recent blog posts, a Viral Launch review by marketplace director Lindsay Todd. She’s great. She shares three awesome stories about a few of our clients that utilize Viral Launch software to take their businesses to the next level. We’ve also got a new course up on our YouTube channel about how to set up a product launch. You can have a coach walk you through the whole process at your convenience and with the option to play back all of the information.

Casey Gauss:
Want to be featured on the show? Leave a voicemail and tell us your thoughts on today’s episode, or ask us any of your Amazon questions. Our number is 317-721-6590. Join us for Episode 3 where we dispel the diversification myth. Until then, remember, the data is out there.

 

About the Amazon FBA Seller Podcast:

Viral Launch CEO, Casey Gauss, and Amazon Seller Coach Cameron Yoder bring data-driven insights to the Seller community in their weekly discussions.

On the show you’ll get the latest Amazon selling strategies and best practices based on the company’s experience launching over 22,000 products and working with over 5,500 brands. Casey and Cam will bring you up to speed on the latest Amazon news, share stories of success and failure, explore the difficulties of entrepreneurship, and discuss the way Amazon is changing retail.

At the center of the show is the Viral Launch commitment to offering reliable information to today’s entrepreneurs.

Follow the Data Episode 2: BONUS Q4 Part I Optimizing Your Listing

The holiday season begins in October for Amazon sellers, but it’s not all fun and gifts. Being aware of fee changes, having crucial deadlines circled on your calendar, and optimizing your listing to move sales is just part of the diligent work it takes to beat out the competition and increase profits during the biggest shopping event of the year. Listen in as Casey and Cameron detail how to prepare for success in Amazon Q4.

Listen on iTunes . See All Episodes

Listen on Stitcher / Listen on Google Play

 

Follow the Data Show Notes:

  • Check out this Amazon press release for more cool and crazy stats about Q4 2016 like those featured at the opening of the show.
  • Important Dates
    • Oct. 1 – Reduced Fulfillment and Increased Storage fees
      • Fulfillment Fees will be reduced and will now be consistent with Fulfillment Fees in November and December. With the reduction in Fulfillment Fees, if you reduce the storage space you use in October, you have the opportunity to pay lower total FBA fees in October.
      • The monthly inventory storage fee for October will be increased for standard-size and oversize items to be consistent with the monthly inventory storage fees for November and December.
    • Mid-October – FBA Cutoff for new FBA Seller Accounts
      • This one is for those who have not sent a product into FBA through their seller account. On October 10, 2016, Amazon denied new FBA sellers in anticipation for full warehouses. This year, watch for the same cutoff in mid-October. As confirmed by an Amazon rep, this restriction is account-based, not ASINbased. So if you’re planning to start selling later this fall, send in a few products to FBA now to ensure your eligibility for the 2017 holiday season
    • Nov. 7 – FBA Inventory Deadline for Black Friday and Cyber Monday
      • This one is crucial. Make sure you plan to have your Black Friday and Cyber Monday inventory arrive at Amazon before early November (or even well before then, just to be safe).
    • Nov. 24 – Black Friday
      • The day after Thanksgiving, regarded as the first day of the traditional shopping season will set the holiday shopping in motion. From now until Christmas, FBA sellers must be on top of their game to capitalize on the immense sales potential.
    • Nov. 27 – Cyber Monday
      • comScore reported Amazon ranked #1 among online retailers in Cyber Monday traffic for 2016, and this year will likely follow suit. Gear up for massive sales on November 27th.
    • Dec. 1 – FBA Inventory Deadline for Sending in Inventory to be Delivered by Christmas
      • The peak worldwide shipping day during the 2016 holiday season was December 19th. Just because Black Friday and Cyber Monday are over doesn’t mean you should pump the breaks. Make sure your Christmas inventory is in Amazon’s warehouses by the December 1, if not earlier.
  • Optimizing your Listing
  • For more helpful tips about preparing for Q4, download the Viral Launch Q4 Guide.
  • Check out our How to Launch YouTube Course
  • A Viral Launch Review: 3 Amazon Product Launch Case Studies
  • Want to be on the show? Leave us a voicemail at (317) 721-6590

 

Podcast Transcript

Casey Gauss:
In just three months during 2016 Amazon generated almost a third of its yearly revenue, and with growth projections pointing skyward, we’re expecting an even bigger holiday season for Amazon this year.

Cameron Yoder:
Q4 is almost here, and if you’re not already preparing, it’s time to start. Competition is fierce around this time of year, and only those who meet the season head-on will truly benefit from the extraordinary amount of traffic Amazon is likely to see. I’m Cameron Yoder.

Casey Gauss:
And I’m Casey Gauss, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we’ll leverage the data we’ve accumulated at Viral Launch from over 20,000 product launches and our experience working with 5500 brands to help you understand the big picture when it comes to Amazon and, most importantly, the best practices for success as an Amazon seller.

Cameron Yoder:
We’re taking a break right now from our four-part series on dispelling myths to help you start preparing for the most important sales quarter of the year, yes, Q4. In this episode we’ll run through all of the must-know dates and all the vital prep that will set you up for success for this holiday season.

Casey Gauss:
By the time the episode is over hopefully you’ll have your work cut out for you and a proven prep strategy that will help you take advantage of the crazy Amazon Q4 sales coming your way.

Cameron Yoder:
Q4 2016 on Amazon was an event like the US economy has never seen. In the course of three months Amazon delivered enough men’s jeans – men’s jeans – to fill an Olympic -sized swimming pool. That’s crazy. Customers purchased enough 4K TVs to reach the peak of Mount Everest more than nine times, and 2.5 million watches were purchased. That is a watch sale every 1.5 seconds.

Casey Gauss:
I heard they had to actually go to an Olympic pool to measure the jeans there.

Cameron Yoder:
Yeah, I think you’re right actually.

Casey Gauss:
It’s pretty interesting.

Cameron Yoder:
You know, out of all those TVs I still don’t have a 4K TV.

Casey Gauss:
Missing out man.

Cameron Yoder:
I know.

Casey Gauss:
Viral Launch needs to pay you more.

Cameron Yoder:
Ah, geez.

Casey Gauss:
So Q4 was huge in 2016, and it’s going to be even bigger this year. If you want to claim your share of Q4 sales you need to make sure your business is set up to succeed. Let’s get started.

Cameron Yoder:
Yep. So we’re talking about important dates right now. I would encourage you, if you’re in a spot to be able to write them down or type them out, then follow through with us. But if not, then you can just go back and listen to the podcast and get those dates.

Casey Gauss:
We’ll also have some show notes.

Cameron Yoder:
Yeah, oh yeah, right. Well, I guess that helps, too. So the first date we’re going to talk about is October 1st. Now this is coming up. It’s soon. October 1st is the date where fulfillment fees will reduce and inventory and storage fees will increase.

Casey Gauss:
Amazon does not want to be a warehouse, but they do want to ship your goods when sales are happening, and they want to make sure that they are the warehouse to do that. So definitely make sure that you mark this down. Make sure that you have inventory moving, and ideally, if possible, don’t use Amazon as a storage facility.

Cameron Yoder:
This is – we’ll go through some of this later, but really having your inventory planned and numbers planned kind of goes into account here. Now these numbers, the reductions in fulfillment fees and increase in inventory and storage fees, will go into effect in October, but they’ll last through November and December, so again, throughout that holiday season.

Casey Gauss:
In mid-October last year in 2016 we saw a cut off for new FBA seller accounts.

Cameron Yoder:
Now this was actually kind of crazy for new sellers because Amazon did not announce it beforehand.

Casey Gauss:
Yeah, so if you had $500,000 of inventory that you purchased because you thought you were going to get rich in Amazon Q4 but you hadn’t created your seller account and sent inventory in, like you were just completely screwed. So Cam has got the trick for you.

Cameron Yoder:
I’ve got the trick. Here’s a trick that should work. Again, we’re not claiming that it’s going to work indefinitely for every single person. However, however, we have seen this work for others. So if you are a new FBA seller and you have not sent in inventory yet, here is something you can do to ensure, or hopefully ensure, that you will be able to send in inventory if you plan on getting your inventory in after mid-October, which you should get it in as soon as you can. But if you haven’t created an order yet you should go to the store. You should buy something, and you should send it in to Amazon FBA. Basically you should do what’s called retail arbitrage. So you’re going to go to the store, you’re going to buy something, and you’re going to flip it basically and sell it on Amazon. You’re going create a separate shipping order. If you need instructions on how to do that just Google Amazon retail arbitrage or how to ship retail arbitrage stuff into Amazon, and it will take you through it. But basically by doing this you are creating a shipping order for Amazon which will basically get that one, that one or that first shipping order out of the way, and Amazon will then allow you to create another shipping order once your inventory gets in or is on its way.

Casey Gauss:
Next date is November 7th. This is the inventory deadline for Black Friday and Cyber Monday, and this does not mean send your last shipment on November 6th at midnight. It takes time to get your stuff checked into FBA, and during the holiday season Amazon is definitely ramping up staff to make sure that they can process all the inventory and all the orders. But sometimes there’s major delays, and you know we’ve definitely had friends that their inventory gets stuck in customs, or it gets stuck in FBA going through the check-in process. So the earlier you can get your inventory in in preparation for Black Friday/Cyber Monday, the better, and the more likely it is that you are able to guarantee that you’ll have the inventory you want to sell.

Cameron Yoder:
So if you want to make some crazy good sales for Black Friday and Cyber Monday, have your inventory in before November 7th. Again, in Amazon. Now as for Black Friday and Cyber Monday, Black Friday is on the 24th of November, and Cyber Monday is on the 27th. So again, November 7th, 24th, 27th. Cyber Monday was – this is just a little fact — but Amazon reportedly ranked number one among online retailers for Cyber Monday traffic in 2016. We’re assuming it’s the same thing for 2017.

Casey Gauss:
Yep, and then final date just to be aware of, December 1st is the deadline to send inventory in to be delivered by Christmas. Again, please expect delays. Do not expect things to go quickly. Make sure that you have your inventory in as quick as possible. Another interesting little fact is the peak worldwide shipping day in 2016 was December 19th.

Cameron Yoder:
Geez. I want to reiterate the deadlines. Again, mid-October is at — unconfirmed, again unconfirmed cut off for new FBA sellers. November 7th is the deadline to have your stuff in for Black Friday and Cyber Monday. December 1st is that Christmas inventory deadline.

Casey Gauss:
So next we want to talk about optimizing your listings in preparation for Q4. You know, really at the end of the day this should go without saying, but we kind of want to dive in a little bit. You need to have your ducks in a row for Q4 because this is the biggest shopping season – not single-day; that’s Prime Day assumedly – this is the biggest shopping season of your career. Like it’s not worth cutting the corners or, you know, being lazy and just expecting the money to roll in. Will some money role in? For sure. But if you could be making tens of thousands of dollars more by taking an extra day or two extra days, it’s totally worth it.

Cameron Yoder:
And all this stuff, I mean this advice for optimizing the quality of your product, should be taken into account every single day for the rest of the year.

Casey Gauss:
For sure.

Cameron Yoder:
But it’s going to matter probably the most around this time of the year.

Casey Gauss:
Yeah, everything is just amplified. Cam, let’s talk about photography.

Cameron Yoder:
Yeah, let’s talk about it. Let’s talk about photos, yo. With photography, honestly, the most important thing is to have high-quality, a high-quality professional hero image that stands out to accentuate all product features. It tells a story, or your photos in general tell a story, and establish and build an emotional connection with whoever is seeing it. What do people see when they search for products? Your photo. They see your photos. They see your listing. So having something that’s really well done in that realm, in the realm of photography, is going to be important. I think, from what I’ve seen after talking with a lot of sellers, people get lost in their own photography. And personally I think they need to – I think sellers need to get the opinion of other people that they trust to tell them what they think about their photos. It could be going to like five people and asking them, hey, what do you think of these photos? Are they good, or are they not?

Casey Gauss:
And don’t even tell them that they’re your photos. And you become emotionally attached to your product and whatever materials are surrounding it. And so you are obviously biased that your photos are good, or your photos are better than the competition, and you would just not believe the photos that we have seen where sellers, you know, asking us to optimize their listing or help them increase sales. And you know we just see the images, and it’s absolutely insane that these guys think they’re great. You know it’s hard for us. We want to be nice –

Cameron Yoder:
Of course, of course.

Casey Gauss:
– and say hey, you know, we think you should maybe consider getting or improving your images. And then, you know, they’re like oh no, I’ve had professionals do that.

Cameron Yoder:
They’re good. They’re good to go.

Casey Gauss:
And it’s like it’s just absolutely laughable. And so you know, you’re probably not a creative. You’re probably not the best judge to say whether or not your photos are as optimized as possible. Definitely using split testing to get some data around, you know, what is the best image, what is the best main image, what is the best photo set, what is the best order of my photo set? These are all things that we’re constantly split testing because we want to understand what makes the best photo sets possible. How can we improve sales as best as possible? Definitely, like Cam was saying, having a high-quality main image is important. If you’re having someone shoot photos, have them shoot three or four different potential hero images so that you can identify this one is driving the most clicks; this one is driving the most sessions. Typically it’s not the main image. The main image is just driving clicks. Definitely invest in some high-quality lifestyle shots so customers can really build an emotional connection to your product so you can really tell that story. See much better conversion rates when we have high-quality lifestyle photos. You just cannot supplement those with some Photoshopped who knows what.

Cameron Yoder:
Let’s move on. Let’s move on to listing. Casey, what you got?

Casey Gauss:
You cannot have temporary language, or you’re not supposed to have temporary language in your listings. I have a friend; they’re doing like 150 K a day, and they had their entire account suspended because they had the term “holiday sale” in the title of one of their listings, just one of their listings. Their entire 150 K-a-day operation was suspended for a little over a week, which is pretty insane. So please do not use holiday type language. Some of your competitors will get away with it. Some of your competitors will not. So if that’s a gamble you want to play, I mean –

Cameron Yoder:
It’s not worth it, in my opinion.

Casey Gauss:
Yeah, I mean yeah, that’s completely your call. Definitely make sure that, again, everything is as optimized as possible. Make sure that your language is tailored to the holiday shopper, but again, don’t use that temporary language like sale, holiday, unless holiday is very descriptive of what the product is. Backend keywords, really backend search terms just don’t matter very much. I mean, at the end of the day you only need to include a word one time in your listing. Keywords in your title are much more heavily ranked than anywhere else in the listing. So if you should be worrying about anything, it’s your title. You should be keyword stuffing as much as possible, as much as possible while still giving like a cohesive title so you can maximize the number of keywords and the total views possible for your listing.

Cameron Yoder:
There is a confirmed limit on – basically byte limits for the backend keywords. In the United States it’s 250, but again, that’s 250 without – or characters without spaces for indexing from the backend, 500 in Japan, 200 in India.

Casey Gauss:
Yeah, and, you know, at the end of the day, again, you should not be repeating those backend search terms. So everybody’s like all up in the air about backend search terms, and in reality that’s only 250 characters. There’s so many – I don’t remember of the top of my head anymore – but you have, you know, 100 characters in the title, 100 characters in the five bullet points on your listing and then 2000 characters in your description. So why are you so, you know, worked up over this portion of your listing that’s not even 10% of your listing’s content? Anyways, basically use backend search terms. Don’t repeat any words that you’ve repeated or already put in the front end of the listing. Just don’t worry about them.

Cameron Yoder:
Hey, thank you so much for joining us for part one of our Q4 episode. Feel free to join Casey and I for part two where we’ll talk about the role of enhanced brand content in optimizing your listing, as well as inventory planning and the best way to perfectly time a product promotion to make it big this Q4. I promise you won’t want to miss it.

 

About the Amazon FBA Seller Podcast:

Viral Launch CEO, Casey Gauss, and Amazon Seller Coach Cameron Yoder bring data-driven insights to the Seller community in their weekly discussions.

On the show you’ll get the latest Amazon selling strategies and best practices based on the company’s experience launching over 22,000 products and working with over 5,500 brands. Casey and Cam will bring you up to speed on the latest Amazon news, share stories of success and failure, explore the difficulties of entrepreneurship, and discuss the way Amazon is changing retail.

At the center of the show is the Viral Launch commitment to offering reliable information to today’s entrepreneurs.

 

Follow the Data Episode 1: Dispelling Myths: 90% Off Promotions

Do launches work? Amazon gives higher keyword ranking to products sold at full price, leaving deeply discounted promotional products in the dust… Or so the myth goes. In the inaugural episode of the “Dispelling Myths” series, Viral Launch CEO Casey Gauss dives into the data to validate, or dispel, this widespread concern among Amazon sellers.

Listen on iTunes . See All Episodes

Listen on Stitcher / Listen on Google Play

 

Follow the Data Show Notes:

 

Podcast Transcript

Casey Gauss:
Everyone’s looking for like that next hack. It makes logical sense that 90% off promotions don’t drive as much keyword ranking. You know the problem is that the data just doesn’t show that.

Cameron Yoder:
The buzz about town is that running promotions to get ranking may not work the way it used to. Today we’re diving into the data to see what’s really going on. I’m Cameron Yoder.

Casey Gauss:
And I’m Casey Gauss, your host for Follow the Data: Your Journey to Amazon FBA Success. So in this show we leverage the data we’ve accumulated at Viral Launch from over 20,000 product launches and our experience working with over 5500 brands on Amazon to help you understand the big picture when it comes to Amazon and, most importantly, the best practices for success as an Amazon seller.

Cameron Yoder:
These first four inaugural episodes of Follow the Data are all part of our Dispelling Myths series in which we explore topics that have garnered a lot of conversation among the Amazon seller community recently, but that until now have not been proven or disproven using factual evidence.

Casey Gauss:
We’ll talk about where these Amazon myths come from, why they seem to logically make sense, and what the data is saying, and what is actually happening and how you can apply that moving forward.

Cameron Yoder:
All right, Casey, so this is Episode 1 of Dispelling Myths. We’re talking about promotions here. Can you tell us a little bit about this myth? What exactly is this myth?

Casey Gauss:
Yeah, so essentially this myth is basically stating that Amazon gives higher ranking power or effect to sales at full price versus, you know, the promotions at 90% off. The theory is that if you are running a promotion, if you’re giving a product away at a discount or selling it at a discount, especially 90% off, you’re not going to get nearly as much ranking power as a full-price sale.

Cameron Yoder:
So someone selling on Amazon, let’s say they give away items at 50% off. People are saying that those are not as effective or efficient as – or that the 90% off promotions are not as effective or efficient as the 50% off coupons. Is that right?

Casey Gauss:
Yep, correct.

Cameron Yoder:
Okay, okay. So where – or when, when did this idea start? Like where did it come from?

Casey Gauss:
Yeah, you know, we’ve seen this idea ever since 2014 when we got started. To be honest, I think that it’s definitely had a resurgence. We’ve seen people say you know back in the day oh Amazon will only let a review stick, or you can only get review power if it is at zero dollars, or if it’s over five dollars. You know there’s always these kind of arbitrary metrics that people throw out, and so now there’s just this resurgence. You know I’ve probably seen it a lot more over the last three months maybe, maybe around May, maybe around June, somewhere around there.

Cameron Yoder:
So why do you think it’s researching? Like why is this coming back?

Casey Gauss:
The – so yeah, so I mean with any myth I think a lot of it boils down or finds its root in everyone’s looking for like that next hack. It makes logical sense that 90% off promotions don’t drive as much keyword ranking. You know the problem is that the data just doesn’t show that.

Cameron Yoder:
Another point I guess that’s important, right, is that I mean it would be really, really great if it wasn’t true, right, that oh, that means if 90% off promotions aren’t as effective or efficient, then we don’t have to give products away at 90% off. Like that is a very appealing notion, right? So then that means that sellers don’t have to give products away for extreme discounts.

Casey Gauss:
Yeah, okay, yeah, very true. I would definitely like to point that out as – so it’s called consistency bias, right?

Cameron Yoder:
Yeah, right.

Casey Gauss:
And so you don’t want to spend the money associated with selling product at 90% off, and so you would like to tell yourself that it is great to – or that Amazon prefers full-price sales, and that’s why you want to head that way. Oh yeah, so another instance in which this kind of comes up is, you know, people run one promotion and they don’t get the keyword ranking they expected to see, right? So I’m selling a fish oil. I think I need to give away 50 units a day, let’s just say. And so I do that, and I expected to get to page 1, but I only got to bottom of page 2, right? And so then instantly everybody would jump to oh my gosh, promotions don’t work nearly as well. It must be full-price sales that are the answer. And you know the problem with that is here’s where, you know, the Viral Launch data or perspective really comes into play is that we’re running hundreds and hundreds and hundreds of promotions every day. So we have tons of data where you know, we’re tracking keyword ranking –

Cameron Yoder:
Right.

Casey Gauss:
– for keywords, the targeted keyword, as well as keywords that we find in the title, in the bullet points, in the rest of the listings. So we really, really understand how sales interact with the content of a listing, or tracking the price point of sale, or tracking are coupons present when we have MWS access. And so yeah, we’re able to really get this really broad perspective of the market versus you run one promotion, maybe your keyword, main keyword, wasn’t in the title. Maybe it wasn’t in your listing at all. Maybe, you know, you weren’t even indexed for it, or you know there’s a number of different factors that – and sometimes you know there’s things like cursed products where we just cannot get those things to rank in –

Cameron Yoder:
Cursed products.

Casey Gauss:
Yeah, that’s what we call it. So yeah, there’s so many different variables coming into play that running one test and then not getting the results that you had expected or intended is not enough of a sample size to really draw a strong correlation or a strong conclusion.

Cameron Yoder:
Right. And we, in terms of data – like you were talking about data – we really have that sample size. Again, like we run – we run promotions every single day, and they’re all built off of – or not every single one, but almost all of them are built off of 90% off promotions.

Casey Gauss:
Yeah.

Cameron Yoder:
If that didn’t work and it wasn’t effective, it wouldn’t work for us.

Casey Gauss:
Right.

Cameron Yoder:
And we see it every single day.

Casey Gauss:
Yeah, so I mean getting into the data of it, simply we’re running hundreds and hundreds of launches, and the amount— our ability to drive keyword ranking is just insane. And so at the end of the day Amazon is paying attention to did a sale happen? They’re not paying attention to the number of units that occurred or the price at which it is actually purchased. I think Amazon cares or is paying more attention to the price that the product is listed at.

Cameron Yoder: Let’s transition to a break. We’ll be back right after this message.

Rebecca Longenecker:
Hey, I’m Rebecca Longenecker, the producer for Follow the Data, and I wanted to let you know about a really cool resource the Viral Launch team just published. With this holiday season promising to be the biggest yet for Amazon, we’re offering an e-book that walks you through every aspect of Q4 preparation, from inventory planning, to optimizing your listing for mobile, to making sure your product is showing up in search. We’ve got you covered. There are also fun facts, helpful notes and handy little checklists you can use to evaluate how prepared you are. Don’t miss out on this year’s holiday sales. Go to viral-launch.com/Q4 to download the e-book now. That’s viral-launch.com/Q4. Thanks!

Cameron Yoder:
And we’re back again talking about the myth of giveaways and promotions. So Casey, let’s talk a little bit more about the data that’s backing this dispelling up. Can you touch on everything just a little bit more?

Casey Gauss:
Yeah, you know I think the really simple analogy or the simple logic here to kind of give everyone an example is as simple as this. So let’s take fish oil as an example, and someone wants to run a promotion to get ranking for the keyword, “fish oil.” Well, what we do is we go and we look, okay, here’s page 1 for fish oil. You know these guys are selling, let’s say it’s 50 units a day average page 1 or bottom half of page 1. And we want to get ranking there. So what we will do is we will give away 50 units per day targeting this keyword, “fish oil,” and after three days, five days, maybe seven days we’ll be ranking bottom of page 1 for fish oil, and we did – we ran 90% off promotion. So 90% of the sale price, these guys are selling 50 units a day at the organic price, and we sold at 90% off, and we’re still able to drive the same amount of keyword ranking. And so again, if Amazon did not – or reduced the amount of keyword ranking power as some kind of function of the purchase price we would not be ranking alongside these people that are selling just as many units except at the organic price. So that alone kind of just busts that myth, completely dispels that.

You know, another area this myth came from is there are these, you know, quote unquote experts or service providers in the space that are saying oh, you have to do these full-price deals with us, and the reason they’re doing that and they’re promising these crazy affects, right? So if you come and use our service we will guarantee you hit page 1 or number one most of the time, and we guarantee you will stay there for 30 days. The reason our method is so effective is because we’re using these gift cards to run full-price sales, and in reality what people didn’t realize was this person was running a bot or this artificial ranking method to your listing, and that’s what was getting you the results. That’s what was helping to maintain those results. It wasn’t the fact that you used these gift cards. And so that’s really frustrating to me because one, you know this person is operating on your business without your consent in a black hat manner, and two, they’re just, you know, completely lying about what is driving the results, which then goes and leads people down these dark paths. You know, it is against terms of service to compensate someone or reimburse someone for buying your product. It is absolutely stated explicitly in the terms of service that you cannot do this. It’s black hat. You know, will you get caught for it? I personally don’t know anybody that has. But you know, I think it’s one little slip up and now you’re in trouble for, you know, manipulating Amazon’s system or compensating buyers for purchasing your product.

Cameron Yoder:
Right. Let’s touch a little bit on just like the mentality of why, like why 90%? So why not? Why not? Why can’t – people are asking, why can’t I just launch my product at 50% off? It’s still a heavy discount, right, so why is 90% necessary? Touch on that.

Casey Gauss:
Yeah, so the discounted price or percentage is not a function of effectiveness.

Cameron Yoder:
Right.

Casey Gauss:
It is really, you know, we’re running generally around 450 or so launches a day right now, and so yes, we have a buyer list of 350,000 in the US, but you know these guys have – some of these people have been on our list for, you know, years and years and years.

Cameron Yoder:
A long time.

Casey Gauss:
And so if we’re selling an iPhone 7 case or a fish oil, like this demographic that we have only has so much discretionary income, and if you’re selling your product at 50% off, let’s say $10, versus the usual $1, $2, whatever, like that’s $8 less discretionary income they have to go buy our other products. And so in order to make sure the demand is high enough in the group for every launch that we’re running, we want to keep prices as low as possible so they have the money to buy more stuff.

Cameron Yoder:
Right. The 90% off is very much – it’s a means of control. Like you need to move – you need to move, if you’re launching, again, for fish oil, you’re going to have to move an insane amount of units to get to the top. The 90% off really gives control and gives you the ability to launch to page 1 for that. So the 90% off is a means of moving the launch forward and making it effective.

Casey Gauss:
And you know, to be honest, from like a competitive standpoint, you know if I were a larger seller I would actually kind of prefer this because the smaller sellers don’t have the budget –

Cameron Yoder:
Right, right.

Casey Gauss:
– to be really aggressive in these high-volume markets at these low prices. So they have to, you know, work their way up in a much slower process. And as a larger seller, yes, it is more expensive, but you’re essentially pricing or paying your competitors out of the market, which, you know, for large sellers that works. For smaller sellers, you know, this is why we definitely suggest getting into smaller niches where you don’t have to give away 100 units a day for seven days just to get on page 1, let alone maintain that ranking or whatever.

Cameron Yoder:
Oh, but what about fidget spinners?

Casey Gauss:
Yeah. We don’t want to talk about those.

Cameron Yoder:
No, no, no. So that’s actually a good transition into the takeaway. Let’s talk about what is the main takeaway? From my perspective it’s all about the risk, right, the reward of the risk. You have to take a huge risk. You are taking an investment, kind of an investment with giving away this many units. But giving away this many units at a 90% off discount is going to give you the control and get you on to page 1. And from there, then you will be able to make that increase in sales.

Casey Gauss:
Yeah, oh, completely. I would say, especially like – or specifically to this particular myth I think the takeaways are one, really be careful of who you’re trusting and paying attention to. Two, definitely make sure that you are getting a really solid sample size when you are making conclusions. Again, running one promotion that doesn’t get the ranking effects that you expected it to, you know, maybe you underestimated the number of units needed to give because the guys on page 1 are selling more units through that keyword than you had anticipated. Who knows? But anyways, yeah, please pay attention to your sample size when drawing conclusions because the last thing you want is to draw some conclusion and then spend the next three months and $20,000 trying to build a business around this, you know, this wrongly-founded conclusion. Yeah, and then three, really is at the end of the day, like you have to spend money to make money, like Cam is saying.

Cameron Yoder:
Right, right.

Casey Gauss:
And you know, unfortunately that’s the case right now. And yeah, you know, we’re definitely biased in saying that, but the problem is in that bias like we’ve just seen so many people have success. We just posted three Viral Launch case studies where this guy came, and he was doing $400K a month, and he came in, ran promotions across his product line, and after 30 days he’s doing $650K a month organically just because he improved the keyword rank position of his product. So yeah, he spent a bunch of money. I thought it was $250,000 to get that ranking, but now, you know, his sales are just killing it compared to where he was at. So –

Cameron Yoder:
Yeah.

Casey Gauss:
Yeah.

Cameron Yoder:
Take a zoomed out perspective. Ask why with everything that you’re doing. Make sure you’re getting all the data. Make sure you’re getting all the facts.

Casey Gauss:
Awesome. All right. We’ll see you guys later.

Cameron Yoder:
Hey, that is all for this week. Thank you so much for joining us here on Follow the Data. For more reliable information about what’s really happening on Amazon subscribe to the podcast and check out the Viral Launch blog at Viral-Launch.com.

Casey Gauss:
And don’t forget to leave a review on iTunes if you liked or enjoyed the podcast. We really appreciate your feedback as we work to build this podcast for you. Want to be featured on the show? Leave us a voicemail and tell us your thoughts on today’s episode, or ask us any of your Amazon questions. Our number is 317-721-6590. It will be linked in the show notes. Join us next week when we dispel the myth of Amazon sales velocity. Until then, remember, the data is out there.

 

About the Amazon FBA Seller Podcast:

Viral Launch CEO, Casey Gauss, and Amazon Seller Coach Cameron Yoder bring data-driven insights to the Seller community in their weekly discussions.

On the show you’ll get the latest Amazon selling strategies and best practices based on the company’s experience launching over 22,000 products and working with over 5,500 brands. Casey and Cam will bring you up to speed on the latest Amazon news, share stories of success and failure, explore the difficulties of entrepreneurship, and discuss the way Amazon is changing retail.

At the center of the show is the Viral Launch commitment to offering reliable information to today’s entrepreneurs.

What is keyword research?

Keyword research is the process of finding and collecting relevant words and phrases that online shoppers use when looking for your product. 

The key to a great listing is great keyword research. There are plenty of tools out there that boast their expertise in finding you all the keywords you need for your product, cutting down the time you need to spend on keyword research and making you money by improving your listing. It sounds too good to be true, right? And that’s because it is. You’re not going to be able to find all the best keywords in the same place.

The best way to find the highest volume of relevant keywords that will help you to index, rank, and increase your product’s visibility is to do good, old-fashioned, multi-source keyword research. Great keyword research is not something you can afford to skimp on if you want your product to be successful and can be the difference between making hundreds of dollars or hundreds of thousands of dollars. Here are some of the techniques that we use to write incredibly powerful Amazon listings:

 

  1. Start with a Tool

Tools aren’t perfect, but they are a good place to start. The main keywords for your product will be obvious. Just ask yourself, “What is this product?” If it’s a ball pump, that’s likely your main keyword. If it’s a dog treat, that’s probably your main keyword. Start with that basic word or phrase and feed it to one of the many Amazon Seller keyword tools. Then take the list of keywords that your tool spits back at you, and begin to comb through, taking out words that do not apply to your product.

Keyword tools are great at producing volume, which feels impressive, but there is only so much space in a listing with restrictive character limits. And even if you do stuff your listing full of these tool-generated keywords, the question is: are those keywords relevant to your product and are they ultimately helping your listing?

Unfortunately, from my experience testing out different keyword tools, the answer is no.

For example, if you search for keywords related to ball pump with Scientific Seller, some of the keywords that it suggests are “ballet, shoes, women, thrower, and tent.”

Scientific Seller Keyword Research Results

These keywords might be relevant to your product if it comes with women’s ballet shoes or a tent. No judgment. But that’s what you have to determine as you go through the keyword research results that you get from your tool. You’ll probably need to tweak your searches, doing some broad keywords and more specific phrases, but no matter how you do it, you’re going to have to audit your list for quality.

 

You’ll see the same kind of noise with all of these tools: Merchant Words, Magnet, Google Keyword Planner, and the list goes on. Even still, a tool can speed up your keyword research by providing you with a long list of words that appear around your main keyword. That said, there still isn’t anything that compares to the human brain in distinguishing between relevant and irrelevant keywords for your product.

Make sure to search more specific variations of your main keyword. If your product is organic, try “organic dog treat.” If it’s made in the USA, search “dog treat made in USA.” If it comes with a free toy or doubles as a toy, look up “dog treat toy.” Once you’ve explored these variations and have a robust list, start looking at your competition.

 

  1. Poach Your Competitor’s Keywords

With a solid start to your keyword research, it’s time to check out your competition. I’m not talking about reverse ASIN lookups. This is another alluring solution to cutting down on keyword research time. The problem with reverse ASIN lookups is that you get no competitive edge if you only take your competitor’s’ keywords. You have to take that and more to really push your product above the rest.

Looking at competitors is a good way to fill in gaps in your research. For example, let’s say you searched for dog treat, doggy treat, organic dog treat, dog treat made in the USA, and dog chew, using your keyword tool. You probably missed a few keywords that apply to your product.

Just by scanning the titles of “dog treat” search result page 1 competitors, you might see words like “natural, healthy, flavored, grain free, training treats, gourmet, smoked, delicious, and tender” Add the keywords that apply to your product to your list.

Amazon.com Keyword Research

It can be tempting to go for sheer volume when you’re researching, but be intentional about only adding keywords that relate to your product. For example, if your dog treat is a crunchy treat, don’t use words like “jerky” or “soft.” Your listing may index or even rank for those keywords, but you won’t convert well.

If your product isn’t something that shoppers are searching for, try to find contested keywords with a mix of products in the page 1 search results and add them to your keyword research list.

 

  1. Venture Outside of Amazon

Now that you’ve rounded out your keyword research with keywords from your top competitors, it’s time to broaden your research to other e-commerce platforms like Jet.com and Walmart.com. I like to check Google’s Shopping section in my keyword research as well. You’ll find many of the same products on these sites. Sometimes they use slightly different keywords, and sometimes there are completely different products with their own unique keywords.
Walmart.com Keyword Research

Sticking with the dog treat example, I picked up “pet food, chewing, habits, basted, biscuit, vitamins, minerals, freshen breath, real, ingredient, and chewy.”

Depending on the product, I’ve found this step in my keyword research to be either extremely beneficial or very redundant. Either way, it’s always worth checking. Even just finding a few unique keywords to add to your listing can improve sales month over month. Make sure to search multiple variations of your product’s main keyword or keyword phrase to get the best showing of your online competitors.

Once you’ve covered all your bases on the high-level keywords, it’s time to burrow down into the more specific and more technical keyword research.

 

  1. Use What You’ve Got

Make sure to include your product’s ingredients or materials in your keyword research. Look for common abbreviations or nicknames associated with each component, and research the associated benefits to understand the different ways that your product helps your customer and the different features shoppers might be looking for.

Make sure to add any conditions that your product or your ingredients address, but be cautious with including diseases. Keywords like “heart disease” or “cancer” are sometimes flagged as faulty claims.

 

  1. Utilize Sponsored Ads

Sponsored Ads, or PPC ads, can be another great tool for keyword research. With Automatic ads, Amazon shows your product as a sponsored ad for what it considers to be relevant keywords based on your product’s information. After an Automatic Ad campaign, you can download a keyword report and figure out which keywords your product performed best for.

To start an Amazon Sponsored Products campaign with Automatic Targeting, head to Seller Central > Advertising > Campaign Manager. When creating the campaign, set your daily budget, which is the amount you’re willing to spend in one day, and your bid, which is the maximum amount you are willing to pay when someone clicks your ad.

Run your Automatic campaign for a couple of weeks, and then download the keyword report, which can be accessed in Seller Central under Reports > Advertising Reports > Search Term Report. Once you’ve got the report, you can view the keywords that Amazon ran your ad for, the number of impressions (or views) the ad got, the number of clicks on the ad, and the number of orders made on that ad.

You’ll want to prioritize keywords with high conversion rates in your listing, and you might even want to run through your keyword research routine again with a new focus on these high conversion keywords. High conversion means that for the customer search term entered, your ad got a lot of clicks and orders relative to the number of impressions. For keywords with relatively high clicks but not many orders, you’ll want to consider why shoppers clicked but didn’t buy.

Using Automatic ad campaigns is a quick and fairly simple way to uncover new search terms and determine keyword relevance.

 

  1. Read Related Blog Posts

To round out your collection of technical keywords, look to long-form content like blog posts and product reviews. Especially when researching for backend search terms, related blog posts are a great source of low-volume technical keywords that can help you index for a wider variety of searches, increase your organic sales, and improve your overall rank.

I find buyer guides to be the most keyword-rich, especially for more specific language. In order to appeal to the well-informed and uninformed shopper alike, you’ll want to include simple keywords as well as specific “buzzwords” that shoppers may have encountered in their product research.

I usually find good quality content by searching things like “Which X to Buy” or “Best X for Y,” where X is the main keyword for the product and Y is a condition that the product offers a solution to.

 

Summary

If you follow this tried-and-true keyword research process, you will find a wide variety of relevant keywords that are specific to your product and that can help you to index, rank, and convert. The more honest you are about your product, starting with your keyword research, the more closely your product will match a shopper’s expectations and the more likely you are to convert.

Keyword research is so foundational to a successful listing. It’s worth spending the time to hunt down a diverse collection that will help increase your product’s visibility.

If you’re managing multiple products and don’t have time to go in depth with this kind of keyword research, Viral Launch is always here to lend a hand. Call a coach today to find out how a listing optimization can help your Amazon business.