According to a report from Insider, Amazon sellers reaping the benefits of July’s annual Prime Day may not be waiting too long before another retail holiday to boost sales. Leaked documents from Amazon detail plans for a potential Amazon Prime Day – like sales event in October named the Prime Early Access Sale.
While we can only speculate at this time, the “Early Access” name may imply an opportunity for Prime members to receive early access to the following month’s Black Friday deals. Amazon sellers will surely want to pay attention to more information about this potential sales event as more information becomes available.
Veteran sellers will remember this would not be the first major sales event in Amazon history held in October, as the COVID-19 pandemic pushed back Prime Day 2020 from its usual mid-summer date to October 13th and 14th.
How major could the Prime Early Access Sale be?
“This event is one of the best deals events of the year and Prime members would be crazy to miss it,” one document said. Also according to the Insider reporting, some third-party sellers report receiving invitations to submit deals for the event.
Whether officially billed as a precursor to Black Friday or not, an Amazon-led sales event in October could mark the unofficial kickoff to the holiday shopping season.
Seemingly since the massive success of the initial Prime Day in 2015, speculation has persisted that Amazon could add a second major sales event. The duration of Prime Day has slowly increased from 24 hours to 48 hours in 2019, which is the current span of the sales period. After years of establishing Prime Day as one of, and perhaps the most important shopping event on the calendar, Amazon may be looking to the next idea to expand its reach in e-commerce.
After a period of unforeseen and fortuitous growth in the wake of the coronavirus outbreak, the re-opening of brick-and-mortar retail and a downturn in consumer spending have served as a reminder that meteoric growth can’t sustain linear growth forever.
By adding a second signature sales event, Amazon could provide some juice for third-party Amazon sellers to bolster sales heading into the very busy holiday season.
After yet another colossal Prime Day in July during which 24 countries participated in days of deals, any Amazon promotion should be prepared for and meticulously planned for, as it can skyrocket sales and make a tremendous difference in your bottom line.
The timing of the event adds even more weight to this opportunity, with the potential for an avalanche of sales and reviews to enhance visibility for your product and make your product more appealing to shoppers in the run-up to Black Friday and the ever-so-crucial holiday season.
The addition of a second major sales date before the busiest time of the year could be a much-welcomed accelerant to bolster sales.
Stay on top of Prime Early Access Sale updates and Amazon seller news by subscribing to our email list!
Cash flow is the backbone of any eCommerce company. It is crucial to keep cash flow moving smoothly. If it becomes too much of a pinch point, it can kill the business. Cash flow is defined by the amount of cash available to your business throughout its operations. It is usually measured every month, and the primary source of promote cash flow for eCommerce businesses comes through selling product.
Cash flow is crucial for businesses and shows how much money passes through the operations. Yet, it is not the same as a profit. The funds received from customers are collected under the term cash flow. Businesses still need to pay for expenses like rent, labor, utilities, taxes, and other fees. Every company has a constant fluctuation of cash flow. The amount of cash received (and when) depends on supply and demand and the business’s monthly expenses. With proper data management, a company’s ever-changing cash flow can still be predictable and manageable and enable sound business decisions.
Why Is Cash Flow Important
Cash flow is the backbone of a business, so if it fails, the company fails. A recent study from CB Insights found that a third of companies failed because they ran out of cash. One-third of businesses also fail due to an insufficient market for the product they are selling. Which then leads to a lack of cash flow. Improperly managed cash flow streams can lead to poor decision-making, a misunderstanding of how a company’s money is spent, and ultimately be the downfall of a business.
Companies need to prioritize their cash flow to ensure that their business will stay afloat and reap more benefits from adequately managed cash flow. As businesses manage their cash flow, they pay close attention to how their money is spent and control their finances. When a company has a positive cash flow, it improves the relationships with its partners and customers and promotes brand loyalty. It can also help businesses find their strengths and weaknesses, and how best they can expand.
What Promotes Cash Flow
There are a few ways that businesses can promote cash flow and ensure that they will thrive. The first step in promoting cash flow is planning and forecasting. In order to spend money correctly, businesses need to know how much money will be coming in and when. With a better idea of how money flows through a business, there will be less overspending and fewer mistakes when judging how much money the company has.
With planning comes a strategy of what businesses should spend money on and when. Companies should plan when their cash flow is coming in and the best allocation of that money. If there is a low demand for a particular product, there is no need to spend cash flow on an abundance of inventory. Companies should find what is a priority for spending and what needs the most attention. Pay close attention to what needs fixing. This will promote more cash flow and allow attention to shift to minor issues.
Cash flow improves when companies receive money faster and hang onto it longer. Speeding up the process of obtaining cash can incentivize customers to choose a faster form of payment. Companies can hold on to money for longer by buying inventory, earning interest, and elongating the amount of time before paying expenses. This sales cycle gives control over when costs pay off and how much money is in the business at one time.
What Challenges Cash Flow
Many daily challenges come along with maintaining cash flow. Businesses that forecast their finances consistently can learn how to work around everyday challenges. Conversely, companies that do not find solutions to these problems end up with cash flow as a bigger pinch point, which can negatively impact the entire operation.
Some common challenges with cash flow include delayed payments from customers. Sometimes, purchases can happen pretty quickly. Businesses may not reap the benefits of the purchase and experience a time with a shortage of cash. Less cash flow is caused by bank deposits holding money. Or if a large sum of cash flow to buy equipment or machines, leading to businesses waiting for new revenue. Companies unaware of their total cash flow, or spend their cash flow before secure income experience negative cash flow. The life of the business is then solely dependent on the speed of its recovery.
How Payability Can Help
Payability recognizes the difficulties that eCommerce businesses face with cash flow. The funding programs are built for eCommerce businesses that need assistance filling the gap between paying expenses and receiving revenue. eCommerce businesses no longer have to worry about the risk of cash flow with the help of Payability. To see if your company qualifies for Instant Access to your marketplace payouts, visit Payability.com and apply now.
Thank you Payability for your guest post. For more information on Payability, head to their site. To better your selling business and software tools, head to Viral Launches main page.
Corey Gary is Viral Launches amazing Demand Generation Strategist and Advertising Manager. This guest post written by Corey highlights the importance of E-commerce and Advertising in how they go hand in hand.
I started my career in Digital Marketing as an Analyst at an agency located in New York City. I joined an account with separate teams for programmatic, paid social, and E-comm. Since we rarely communicated with each other, I felt siloed and inefficient.
A few years and a few clients later, I’ve worked across almost all facets of Digital Marketing. I’ve run Display & Video as well as Search & Social ads. There have also been opportunities to buy programmatic podcast ads and CTV (connected TV ads). I also purchased a programmatic Digital-Out-Of-Home campaign where the vendor claimed they could change ads at a bus stop based on the interests of the people walking by. We ran this campaign before iOS 14.5 and increased privacy regulations.
Working on a channel-agnostic team of digital marketers was not only rounded out my Working on a channel-Agnostic team of digital marketers not only rounded out my skill set but was best for the client’s expanding needs. Having multiple types of marketers on one team helped us own all stages of the digital marketing funnel.
Awareness campaigns matter for E-commerce and Advertising.
Awareness campaigns are excellent for large brands, but how about those small Amazon start-ups who don’t have millions of dollars to spend on billboards that connect to the Metaverse? That’s where e-commerce advertising is essential. Buying for conversions is where marketers can gauge the effectiveness of their campaigns. E-commerce advertising becomes essential once a consumer is familiar with a brand. As a consumer, if I allocate myself $150 for a new pair of running shoes, I can choose between big brands such as Nike or Adidas and Asics. Or, I can shop with up-and-comers like On and Hoka. These two shoe brands are agile and efficient in their digital marketing. Both On and HOKA have extensive running shoe digital marketing campaigns while the big brands are nonexistent on the SERP (Search Engine Landing Page).
As a consumer during the evaluation process of the marketing funnel: I decided to allocate my $150 depending on a wide range of criteria such as cost after taxes & shipping, quality of the product, reviews, merchant (Amazon or EastBay), and color. For the digital marketer on the other end of the purchase, yes, people buy running shoes based on color, guilty as charged.
The seller can optimize their ads to account for all these criteria to meet the customer when they’ve allocated time to research and budget. It takes time for the Digital Marketer to A/B test which ads perform best on a specific channel. Here’s one example.
On Amazon, an ad for the keyword [running shoe] could perform vastly different than an ad for the keyword [racing running shoe]. The first keyword is for buyers who want a running shoe but aren’t necessarily intense runners. However, [racing running shoe] clarifies that the buyer could be participating in this year’s New York City Marathon in addition to their local Turkey Trot. Viral Launch has expert-level keyword analysis software to help e-commerce marketers discover the best keywords to target for their online advertisement.
Conversions mean results.
So, why is it essential that all Digital Marketers learn E-commerce Advertising? Conversions drive business results, and ultimately the purpose of marketing is to have a positive return on investment. Marketers can spend all day ideating grand awareness campaigns. Still, conversion marketing is where CMO’s can go to stakeholders exclaiming, “look at how my campaigns drove an increase in sales with a positive.”
As the world recovers from the global pandemic, eCommerce is adjusting yet again to the modern landscape. We’ve seen some interesting Amazon selling trends in 2021, as merchants find new ways to stay ahead of their competition and leverage Amazon’s expanding offerings. Here is what to learn for 2022.
Now, as we near the end of 2021, let’s take a look at some key takeaways to keep in mind for 2022.
Inspect Sample Goods Before Switching Manufacturers
Poor product reviews break listings. 89% of buyers read product reviews as part of their customer journey; you can’t afford to lose consumer trust by accumulating bad reviews. If your products have a bad reputation, you will have trouble selling them to just break even.
So, be sure to order and inspect samples from manufacturers beforehand. If you’ve been using a supplier for a while, don’t drop the ball by compromising your vetting process; it takes one wrong delivery to ultimately tank your customer reviews. Another thing to learn for 2022.
Take Advantage of Amazon’s Expanding Branding Features
Amazon’s Brand Registry gives sellers more control over their products and brand representation. The program is easy to join, and here are a few reasons why you might want to consider it (other than the fact that it’s free):
Increase product sales and conversions
While you may not notice an immediate change in your bottom line, Amazon’s Brand Registry actively works to remove fraudulent listings and delist third parties that are fraudulently using your brand’s name.
Reducing fraud is vital to building trust in your brand and driving conversions. Otherwise, if buyers unknowingly purchase a knockoff, it may reflect poorly on your brand’s image. You can use the registry to report any perceived violations and have infringements removed.
Take back control over your product’s information
Sharing accurate, valuable product information is vital to building customer loyalty. It’s essential to avoid misleading prospects and help them understand precisely how your product can benefit them.
Unfortunately, third-party sellers may not honor your core values and alter your descriptions, spreading misinformation. You can’t avoid third-party sellers either, because they make up for more than 50% of Amazon sales.
Fortunately, Amazon’s Brand Registry gives sellers more control over how products are described in the listing. After submitting your product and company information, Amazon will regulate any third-party attempts to alter them, preserving the key information.
Beyond these measures, the Brand Register protects brands against more complex fraudulent efforts as well. For example, some third parties may use your company logo or information to sell their own knock-off products. Amazon’s Brand Registry combats these malicious activities by:
Removing listings that use your company logo or trademark on products that aren’t yours.
Images need to be removed with trademarked information/items that don’t represent your company.
Removing fraudulent listings that use your brand’s information.
Learn and implement this for 2022.
Access the Sponsored Brands Feature
The Brand Registry unlocks your access to Amazon’s Sponsored Brands Feature, which is an ad format that lets businesses promote up to three products. It also allows you to include your company logo and brand name, which is great for raising brand awareness if you’re selling on Amazon.
A big draw for using the Sponsored Brands feature is that your ad will appear at the top of search results, even above “Sponsored Products.”
Stay on Top of Amazon’s Evolving SEO Algorithms
Paying attention to Amazon SEO is vital to increasing your listing’s visibility and ensuring prospects can easily find you. In a nutshell, Amazon SEO’s purpose is to help consumers buy, so the algorithm works to meet this goal.
When a consumer searches on Amazon, the algorithm quickly determines which product listing has the highest likelihood of fulfilling the searcher’s needs. In other words, Amazon’s SEO algorithm needs to figure out which listing has the highest ‘purchase likelihood’.
Similar to Google on-page SEO practices, there are technical steps you can use to improve your product ranking, including the use of keywords, images, and optimized titles and descriptions. But, to beat out the rigorous competition and rank at the top of Amazon search results, you need to convince the algorithm that consumers are ready to buy your product.
That’s where the A10 (formerly known as A9) algorithm comes in. Amazon’s algorithm undergoes continuous updates, with the ranking factors adjusting slightly every six months or so. Thus, staying current with the evolving algorithm is important to keep your product listing at the top. Keep this up for things to learn for 2022.
Amazon’s A10 algorithm, in general, prioritizes two core criteria for ranking:
The number of customer reviews
Your sales rank, which includes details like how many customers are searching for your product and buying it
It’s important not to get bogged down by the algorithm’s technicalities. Sure, it’s updated regularly, but its core working and objective remains the same: to help customers buy what they need. This intention means sellers should focus on optimizing their offerings for customers.
True to Amazon’s MO, you’ll notice that the two core criteria behind the A10 algorithm are geared towards customers. The algorithm reflects Amazon’s commitment to delivering the best customer experience. By sharing this commitment i.e., keeping customers happy and meeting market needs, you can drive your search ranking up.
Have Both a Vendor and Seller Account
Many growing businesses struggle to decide between having a vendor or a seller account, because each offers unique pros and cons. But what if you could combine the best of both worlds? Turns out you can—Amazon doesn’t restrict sellers from having both accounts.
By having both a vendor and seller account, you can complement sales efforts and mitigate restrictions. For example, seller accounts usually get fewer sales because they lack the “sold by Amazon” endorsement, so having an additional vendor account can increase your bottom line.
Retailers can also leverage the advanced analytics and flexibility of a seller account to help launch new products. Generally, Amazon is hesitant to promote new vendor products because they lack performance information. So, you can do the initial heavy-lifting and sales testing from your seller account and eventually use the analytics to encourage Amazon to endorse the item from your vendor account.
Invest in Good Customer Service Mechanisms
Amazon’s commitment to customer service and delivering the best customer experience is a critical driving factor behind the eCommerce giant’s success. Amazon sellers can take a page out of the megacorp’s book and improve sales by committing to good customer service.
Ecommerce gives merchants access to a full suite of data, analytics, and meaningful insights to tailor marketing efforts and optimize the customer experience. However, without the right systems in place, your support team won’t be able to leverage the data to your brand’s benefit.
Thus, it’s important to invest in good customer service software solutions. For example, you might want to consider using email automation to deliver automated updates, like shipping notifications or order verification.
Additionally, it’s vital to invest in tools to centralize information to maintain customer satisfaction. If customers receive unsatisfactory answers or varying responses across channels, they become frustrated and confused, reducing your FCR (First Contact Resolution) rates. With a centralized knowledge base, you can resolve customer support requests faster and more accurately. Learn this for 2022.
The core best practices for Amazon Sellers don’t change. Whether you look at 2010 or 2021, successful sellers prioritize customer-first experiences, strive to deliver value, take feedback seriously, and leverage tools to optimize their operations.
As we break into 2022, it’s important to remember that these objectives won’t change, but the means to achieve them might. For example, SEO algorithms are continuously evolving, and new technological developments help businesses optimize their operations in new ways. Therefore, staying up to date with these advancements and trends is vital to keep your brand relevant and successful.
To sum things up to learn for 2022, don’t forget to:
Weigh your options out with Seller and Vendor accounts, and see if it’s beneficial to use both.
Invest in centralized knowledge and automation to deliver better customer service.
Leverage Amazon’s robust branding features.
Keep up with the latest Amazon SEO updates.
Inspect your products as they arrive.
And don’t forget to put your customers first!
Jake Rheude is the Director of Marketing for Red Stag Fulfillment, an e-commerce fulfillment warehouse that was born out of e-commerce. He has years of experience in e-commerce and business development. In his free time, Jake enjoys reading about business and sharing his own experience with others.
The truth is: You should not scale up or aggressively run PPC before you are retail ready.
A majority of advice that comes down the line on selling is focused on PPC campaigns. You are able to find hundreds of articles conveying “The best PPC campaign” or “Do this to build sales” for your business. Yet, not many articles go over when you should focus on PPC campaigns and start investing in those areas.
Retail Ready comes first
You and your business need to be retail ready in order to successfully run Amazon Advertising. Set yourself up correctly with reviews, correct SEO and keywords, product photos, etc. It is okay to not immediately jump into PPC, it is the safer route. A majority of sellers want to quickly scale up and aggressively run PPC in order to get ahead and set the curve. The truth is, if you are starting out right now, you are going to have to slow down.
Most of the differentiating ad types on Amazon simply use your existing listing as the ad itself. Sponsored brand ads that are largely designed to drive awareness even include the listing elements such as product photography and reviews.
Don’t pay before you are ready.
You are paying Amazon to show your listing to more shoppers. If you start paying for more people to see your listing before it is ‘retail ready’ you are bound to get low click through rates and low sales. Regardless, Amazon will still happily take your advertising budget.
There are millions of sellers out there all running PPC as well. Before getting your feet wet, have all of your ducks in a row. Join Amazon seller community groups and ask questions in the forums, learn all there is to know about PPC while still building the business. Once your business is running smoothly and is retail ready, then create the PPC strategy and implement it.
Doing this will save you time, energy, and a lot of money at the backend. Save your reserves and don’t jump the gun. If you need resources on Amazon PPC specifically, this guide will give you more insight into how Amazon runs their programs. Viral Launch has their own guide as well utilizing the Ad Manager tool and Kinetic.
How you can make the most of the newest Amazon keyword: Squid Game.
As most of the world knows, Squid Game was released by Netflix on September 17th, 2021. Not even a month into its release, it is the number one watched show on Netflix. Plus, it is the streaming platform’s most watched tv show in its history. What once was a keyword no one has heard of before just 3 weeks ago is now one of the largest keywords on Amazon.
As you can see in the image below, “Squid Game’s” keyword phrases dominate halloween costumes and costumes in general. It is on trend to be the halloween outfit of the year. Similar to the Harley Quinn costume in 2016 with Suicide Squad. It is fascinating to see how quickly keyword trends and phrases pop up. This verifies again that it is vital for Amazon sellers to stay up to speed on social trends. If you are able to get involved with selling early, you can make thousands of dollars quickly and efficiently with not much competition.
Squid Game reaches beyond Netflix
Alongside costumes becoming a trending search on Amazon, Vans saw a 7,800% increase in sales of white slip on vans. They’re the TV show’s premier shoe with an increase in sales across the globe. Netflix, Vans, and those selling track suits are on par to make big bucks in 2021.
The trend continues.
According to our Keyword Manager and Research tools, Squid Game Costume has over 500,000 searches starting in October. In September, it only had around 50,000 searches. Those who were in the selling game that early were the first to make big bucks on those searches. It is still not too late. Our data shows that the search volume will most likely continue to trend upwards till about October 31st. After halloween, search volume will more than likely drop off.
What is next after Squid Game?
As the movies Marvel’s Eternals, new episodes of Netflix’s Bridgerton, and Spiderman: No Way Home are coming out later this year, it is important to keep in mind that these will open up avenues for more selling opportunities. Try to get involved in these early before they skyrocket in keyword trends like Squid Game.
With data research going back over 4 years, Viral Launch provides their users with the largest library of Amazon keywords. The Keyword Manager tool is the most popular among users. Especially for its ability to quickly compare and contrast specific keywords and how it compares to similar ones. Users can optimize the best SEO for their products to hit the number one spot on Amazon.
On Tuesday, Amazon announced a new feature for the Advertising console, the Budgets Page (beta). While the new feature hasn’t generated much buzz, it should be on the radar of every Amazon seller utilizing advertising. It comes with some powerful performance insights and actionable steps being added to their Seller Central account.
The value proposition of the new Budgets page is the powerful data points that allow individualized metrics and estimates for your campaign. Within this page, you can see the average time your campaigns were in budget. It covers estimates on missed sales, missed impressions and missed clicks in the time that the campaign was out of budget.
With the data provided on the page, this will also provide a recommended daily budget for each of your campaigns. It covers the goal of optimizing ad spend, and the option to apply those recommendations.
Amazon claims they are able to provide estimated missed sales, missed clicks, and missed impressions through Amazon’s machine learning technology based on historical performance.
The potential of these estimates and metrics can go a long way for Amazon sellers looking to get the most advertising bang for their buck. Access to this information (for free) is a huge advantage for savvy sellers looking to maximize advertising efforts. Knowing how many sales you could be racking up in the time your ads are inactive would theoretically answer any questions or concerns about the efficiency of your campaigns.
It’s important to remember that the majority of these metrics are estimates. These estimates could eliminate much of the guesswork when creating and optimizing PPC campaigns. If accurate, you won’t have to wonder how many sales, clicks, or impressions were left on the table while a campaign ran out of budget.
In theory, Amazon is able to monitor your advertising campaigns over time. Plus, be able to create estimates on performance if they were to run in perpetuity.
Additionally, Amazon sellers can see which campaigns are running out the quickest, compare actual budget to recommended budget, and more.
Where can I access the Budgets page?
Sellers can find the brand new Budgets Page (beta) in a few different ways:
Within Campaign Manager, select the Budgets page.
Download the data into a report within the Report Center of Seller Central.
Set up a subscription within Seller Central to have the results emailed to you.
Within the Reports page, information and data will be available beyond the limits of Campaign Manager, which displays information from the last 90 days.
Want the latest Amazon news, updates, and hot topics sent straight to your mailbox? Drop your email below to receive our newsletter.
The new Budgets page should be something to keep an eye on for any sellers advertising on Amazon. Tracking the campaign estimates for accuracy could greatly benefit sellers in regard to maximizing return on ad spend.
Monitoring estimates and tracking performance when taking suggested actions will certainly be interesting. We’ll be sure to monitor the new page as more information becomes available.
Overall, it becomes the latest addition to the Advertising Console’s busy 2021, which has been a central point of emphasis for Amazon. The amount of time, attention, and energy paid by Amazon into revamping the Advertising Console should speak volumes as to where the future of Amazon is headed.
If you haven’t begun advertising through PPC on Amazon yet, don’t wait too much longer to start creating your campaigns. With plenty of new tools and features, there are many resources to help you get started.
Conquering Amazon PPC is shifting from an elective skill to a prerequisite for success as a seller. In the not-so-distant future of selling on Amazon, the arms race for dominating a market will likely be through advertising.
Because PPC is transitioning from the elective stage, it’s still a facet of selling that gives many sellers headaches. But fear not, and try to view this as an opportunity, not a roadblock. By gaining PPC knowledge and experience now, you can distance yourself from the competition for short-term gains and long-term dominance.
To help, we chatted with Sumner Hobart, an Amazon PPC maestro who has utilized PPC to power his business and change his life through FBA. Tune in as we pick his brain to break down Amazon PPC tips and tricks on your way to advertising like a pro!
Get to know Sumner and his story of how selling on Amazon helped transform his life. (0:00)
Selling via FBA has changed so many lives, helping them live out their dreams through entrepreneurship. We say hello to Sumner and get to know his story from his experience before selling on Amazon, how he got into it, and how he turned it into a rewarding career and lifestyle.
When should sellers start running PPC campaigns? (5:22)
One common refrain we’ve heard from sellers considering making the leap into PPC is that they don’t think the time is right. We chat with Sumner to hear about his path in PPC and how sellers can know if they’re ready or not to introduce their product to ads.
What goals should sellers new to PPC be considering to determine success? (14:30)
Not all campaigns are created with the same goals in mind. Sumner explains the primary objectives behind PPC campaigns, and discusses what steps you take to accomplish these goals through ad campaigns.
Sumner shines a light on which campaigns outside of the norm should sellers examine in PPC and how to put them into place. (26:34)
After explaining some of the basic PPC campaigns, we dive a little deeper with Sumner on more niche campaigns. While the basics are tried and true, sellers can find more success and learn more about their performance by getting a little more creative ith their campaign structures.
Does driving external traffic play a role with PPC? If so, how can a seller integrate it into their strategy? (44:37)
Over recent months, the emphasis on driving external traffic has been further incentivized by Amazon. In terms of overall strategy, the ability to drive traffic from outside of Amazon continues to rise as well. Building a following on social media, growing an email list of potential customers, or driving traffic through ads from Google, Facebook, TikTok, or other spaces outside of Amazon can be extremely valuable.
Sumner breaks down how driving external traffic and PPC can go hand-in-hand to strategically grow and scale your Amazon business to new heights.
A huge thanks to Sumner for chatting with us and sharing his expertise. You can stay in touch for more helpful FBA gems by connecting with him on LinkedIn, or pick up tricks of the trade through his selling courses.
Want the latest Amazon news, updates, and hot topics sent straight to your mailbox? Drop your email below to receive our newsletter.
Over the past couple of years, TikTok has skyrocketed in popularity. Here’s how you and your Amazon business can create ads to leverage its growing user base.
During TikTok’s rise, many Amazon sellers were understandably wary about investing time and money into advertising on TikTok. Social media apps don’t pop up as frequently as they once did. Social media sites are notorious for being here today, and gone tomorrow.
When a newcomer to the social media scene pops up and experiences success, it doesn’t take long for the social media giants to integrate the new popular feature into their site to eliminate any advantage newcomers may enter with. Vultures were circling around TikTok when government intervention threatened the app’s livelihood in the United States.
With so many responsibilities on an Amazon seller’s plate, they don’t have the time to become well-versed in an app that may have the staying power of the fidget spinner.
After it all, TikTok still stands tall.
With over 600 million users and steady growth, TikTok is the most downloaded app of 2021 and remains a heavy hitter in social media with a growing advertising platform.
And in case you were ever questioning the investment of time, energy, and money into advertising on TikTok, Amazon’s recent Brand Referral Bonus Program adds an extra incentive for those who drive sales from outside of Amazon.
So how can you start creating TikTok ads to boost your sales and take advantage of the bonus program? Let’s take a look at the ad types, how to monitor ad performance, and some tips for getting started.
Ad Placement Options on TikTok
At the time of this post, there are five types of ad types for advertisers to choose from on TikTok.
Users encounter in-feed ads when scrolling through videos on the “For You” page, which caters content to the user’s viewing history via TikTok’s algorithm. These ads contain a call-to-action functionality, so you can urge users to visit your web store, download your app, etc.
Considered prime digital real estate, TopView ads appear when users open up TikTok and boast sight, sound, and narrative functionality. Because of this, they are generally very expensive and more commonly used by prominent brands.
This ad type appears for users when first opening the app and stay true to TikTok’s initial idea with a 3-5 second, sound-off video. Exclusive to one advertiser per day, Brand Takeover ads are ideal for increasing brand awareness.
For these ads, the entire screen becomes clickable to an external or internal destination of your choosing. Designed to be rare, these ads are likely infrequently used by Amazon sellers with the exception of mature brands with larger storefronts.
Branded Hashtag Challenge
There’s a decent chance your first exposure to TikTok came via the app’s challenges, which go viral frequently. These challenges typically give users a template to create fun, shareable content. Perhaps the most successful example of the power of the app’s challenges is the song “Old Town Road” by Lil’ Nas x.
The genre-bending song and its easily distinguishable sound provided fertile ground for viral videos, which helped catapult the catchy song into the top spot on the Billboard Hot 100 for 19 consecutive weeks.
These ads appear via in-feed video, a featured banner on the Discovery page, and on a special page for Hashtag challenges, where users go for content ideas. Up to 15 seconds in duration, these sound-on ads help increase brand awareness and have limitless potential for engagement.
A unique type of advertising, Branded Effects ads provide digital stickers, filters, and special effects for use in videos. Essentially, brands create their version of a Brand Kit for users to use in their content. When used, it allows your brand to be added for easily shareable content by TikTokers.
Whichever ad type(s) work best for you are dependent on the goal of your campaign, targeting structure, size of your business, and budget.
How Do You Get Customers To Amazon?
Engaging content, a click-worthy product, and Amazon Attribution!
When setting up your advertisements on TikTok, be sure to utilize Amazon Attribution.
Amazon Attribution is an advertising and analytics measurement solution that gives marketers insight into how their non-Amazon marketing channels across search, social, video, display, and email impact shopping activity and sales performance on Amazon. With these insights, you can discover new ways to grow your business on Amazon by optimizing experiences off Amazon.
In order to benefit from the aforementioned Brand Referral Bonus Program, the ads must utilize tracking from Amazon Attribution. These links will help measure impact, optimize your strategies based on results, and improve your planning on future campaigns.
At the moment, Amazon Attribution is exclusively available to professional sellers enrolled in Amazon Brand Registry in the United States, Canada, Germany, Spain, France, Italy, and the United Kingdom.
Tips for Creating Ads That Generate Engagement
While it’s every brand’s dream for products to catch on via TikTok, one of the most challenging aspects is the lack of control on the internet. All you can do is great ads that best represent your business and hope it connects with viewers. But once it’s done and sent out, who decides what goes viral amongst the endless amount of content?
With that said, there are a few general rules to consider while creating ads that are more likely to connect with an audience for the right reasons.
Since TikTok is largely a youthful audience, it can be tempting to overcompensate with ads that can end up with cringeworthy results.
If there’s any audience that can spot an imposter or a brand trying a little too hard, it’s younger people. More than most target markets, the youth know when they’re being lied to or when they’re being used.
Of course, you’ll want to stick with the fundamentals of advertising and “speak the language” of your audience. Stay true to your brand voice without coming off as fake or inauthentic to ensure your message is well-received.
Make It Interesting, Quickly
TikTok’s penchant for quick content even birthed the term “The TikTok Generation” when referring to Gen Z or younger audiences with dwindling attention spans. If it isn’t interesting quickly, then it gets tuned out quickly.
With this being the case for content users choose to watch, it’s even more true for ads placed in front of them. Don’t waste time setting up a big payoff in your video, or else it will alienate a significant chunk of users who will be counting the seconds until they can swipe away.
Start off with a bang to capture the user’s attentiveness, educate and entertain afterwards, and finish with a strong call-to-action to close the deal.
Use Attractive, High-Quality Visuals
Since many users create content using only their cell phone cameras, it may appear the barrier to entry is low. Anyone with a decent cell phone can create a video.
However, the bar for production value has been upped a few notches. With light rings, camera stands, and various other recent inventions to upgrade the visual and sound quality becoming more commonplace, don’t cheap out on your production.
Attractive aesthetics and pleasant sounds are the standard for desirable content on the app, so ensuring it meets and surpasses the viewer’s expectation is the bare minimum to draw them in.
Track Your Results and Optimize
As with most new ventures, hitting some speed bumps as you get started should be expected no matter how much research and effort you put in. While researching before making the leap into TikTok advertising can remove or minimize mistakes, you’ll quickly learn what works and what doesn’t work for your product in TikTok’s environment.
Tracking and monitoring key performance indicators and results can go a long way towards optimizing your long-term ad approach. Replicate what works and diagnose why certain ads aren’t delivering peak results to optimize your ad performance.
Work With The Experts (Influencers)
As always, it’s never a bad idea to work with those more knowledgeable than you. If you’re brand new to TikTok, one way to mitigate your lack of experience can be getting in touch with an influencer who makes sense within your niche.
For Amazon sellers, there may never be a more rewarding time to start advertising on TikTok than now. With extra traffic and sales, the Brand Referal Bonus Program incentivizing sellers with extra money, and a growing advertising platform, this is a prime opportunity to start advertising on TikTok.
Sign up for TikTok for Business, set up those Amazon Attribution links, and formulate your content strategy to become the next viral hit and start raking in the money!
Want the latest Amazon news and updates? Drop your email below to receive our newsletter for all things Amazon!
Selling on Amazon has been one of the most popular routes to owning your own business in recent years. From your own living room, you can run a multi-million dollar business for a relatively small startup cost. This is your guide on Due Diligence for Amazon FBA Businesses
Starting an FBA storefront is relatively easy. Once you’ve created your Amazon Seller Central account and sorted out logistics, you can automate most processes. You then have to manage only customer service or PPC campaigns. This is your guide on Due Diligence for Amazon FBA Businesses.
However, if you’re looking to accelerate your business’s growth and progress quickly along the entrepreneurial path, it might be in your best interests to buy an FBA business instead of starting one from scratch.
The Case for Buying over Building an FBA Business
Starting a successful FBA business requires an initial capital injection. As well as the right attitude and skill set, to ensure growth and sustainability.
More than 50% of FBA owners inject at least $1,000 into their business when starting it. While more than one in five owners inject over $10,000 in initial capital, according to one study. However, as you’d expect, it’s not necessarily a pay-to-win game. More FBA businesses in which the owners invested $500 or less were still active. In comparison, those in which the owners invested $10,000 or more are not.
A higher initial investment means you have more room to scale your business. It also means you have more moving parts to manage. However, once the business is optimizing, a highly lucrative investment is ran. Case in point: Wall Street investors and private equity firms have been acquiring mom-and-pop FBA stores in deal sizes totaling billions.
Brand aggregators pick up a variety of FBA brands because they recognize their potential to scale. What if you took a leaf out of brand aggregators’ books and bought a business instead of starting one yourself? You could also acquire an FBA business in a profitable niche. Then, you’re left without having to figure out product-market fit and risk investing capital in different ways. They may end up as sunk costs.
Take a look at how valuations for FBA businesses come about in this guide on Due Diligence for Amazon FBA Businesses. Then you have an idea about how much you should be paying for one.
Basically, an FBA business is valued by the following formula:
Valuation = 12-Month Average Monthly Net Profit x Multiple
The average monthly profit is set against a monthly multiple that takes into account several business performance factors. There is the age of the business, traffic diversity, number of SKUs, the presence of an email list, and more.
Before we dive further into what makes up the monthly multiple, it’s important to understand two things. One is why pricing periods are important and two is why this matters if buying an FBA business.
The number of months over which the average monthly profit calculates might seem like a small detail. Yet, it can reveal a lot about an FBA business.
A 12-month window is the gold standard because it gives the most holistic view of a business’s performance. You can see whether traffic and revenue are affected by seasonality or are quite steady throughout the year. A 12-month window also gives you more data to look at before deciding to purchase.
Some sellers may consider using a shorter pricing window. This reflects a recent increase in performance or because the business began making profit only recently.
Naturally, you want as much information about a business as possible before making any buying decision. A business might look like a great deal according to your criteria. If you’re a first-time buyer, we’d recommend looking at businesses that provide a 12-month average profit.
Now that we’ve explained the importance of the pricing window, we’ll review some things that make up a monthly multiple. As well as what to look out for when doing your due diligence.
Age of the FBA Business
Simply put, the older an FBA business is, the higher the multiple is likely to be.
An older FBA business indicates how resilient it is in the face of challenges. Such as finding product–market fit and establishing a foothold in the market. An older business also shows that it’s in a profitable niche selling in-demand products. Instead of riding the latest trends that may die off in a few months.
We recommend that you look for businesses at least two years old. This isn’t a hard-and-fast rule. Many FBA businesses won’t be profitable for several months after their Amazon storefront is first created. It also takes some time for operations to stabilize and to build up a solid brand.
The Number of Established Traffic Channels
An FBA business with greater traffic diversity will likely command a higher business multiple for two main reasons.
First, diversified traffic channels protect your business if your primary traffic channel is disrupted as a result of a change in search engine algorithms. This scenarios can happen from low experience in marketing and are trying to scale a business yourself. When you think you’ve cracked the advertising code and have great keywords, your pay-per-click (PPC) campaigns could be suspended for a breach of the terms and conditions. Sales can then dry up if you can’t reach new customers.
By establishing different traffic channels for customers to find your products, you also broaden your brand awareness to include new audiences. Having a mix of paid and organic traffic sources is ideal because potential customers might not visit all channels on which your brand has a presence.
Another way to diversify your traffic is through omnichannel selling. Selling on e-commerce platforms outside of Amazon gives you access to audiences who may prefer Walmart or eBay for specific products. Suppose your product is in demand and your copywriting is solid. In that case, you should be able to establish a foothold in various online marketplaces and gain new customers through various traffic sources.
Customer Reviews and Ratings
The simplest way to measure a brand’s reputation is to look at the storefront’s customer reviews and product ratings. What’s great about Amazon is that with enough social proof of ratings and reviews, the marketplace could award your products with badges or labels that give them extra credibility.
An Amazon’s Choice badge means that a product’s shown to people looking at a category for the first time.
With enough sales and positive reviews, the product could also earn a Best-Seller badge, but this is harder to obtain because it requires many reviews and depends on other factors that affect Amazon’s A9 algorithm and Best-Seller Rank. The key takeaway is that an FBA business with an Amazon’s Choice badge, even without a Best-Seller badge, is a reputable brand in its niche.
Other ways to investigate brand strength include monitoring social mentions. You can get a general feel for how a brand is perceived based on who’s talking about it and recommending its products to their friends and family. These types of spontaneous posts or shoutouts can indicate how well-received a product or service is if you don’t want to rely only on reviews and ratings.
The Presence of an Email List
Email marketing creates another revenue stream, working as a traffic driver that exists outside of search engines.
A large email list is an addressable audience of subscribers interested in receiving content from the brand, including product reviews, recommendations, or launches, and could potentially become loyal customers.
Simply put, an email list can significantly boost an FBA business’s revenue.
An extensive email list is also a sign of brand strength, as customers are now more concerned with customer experience and brand innovation rather than depending on how long a brand has been around or how well established it is.
Even if the list isn’t monetized, it can be repurposed in several ways, such as by delivering helpful content or gathering customer feedback. Because an email list is so flexible, it can be a valuable asset for your business; if you have ideas for email marketing campaigns, buying a brand with an existing email list can save you the time of building one from scratch.
The Number of Products on the Storefront
Smaller businesses tend either to have many active products on their storefront or to be based around a select few products while they’re figuring out what works.
If you’re willing to work on a business and spend time optimizing it while you learn the ropes, having an overly large or minimal SKU range might not be as much of an issue.
However, if you’re looking for a hands-off operation, then you’ll want to buy a business with a smaller SKU range. That way, you won’t need to spend as much time on upkeep, including optimizing each listing and checking that it’s still active.
For reference, we’ve seen institutional buyers like brand aggregators and private equity firms acquire seven-figure FBA businesses with 40 or fewer SKUs. These larger institutions have in-house teams that specialize in scaling FBA assets, so a smaller range of products is easier to work with.
If you see a business that meets all your other criteria but has a larger SKU range than you expected, you could hire virtual assistants (VAs) to whom you can delegate the time-consuming and repetitive tasks of product upkeep.
What to Look for in a Great Deal
Choosing which FBA business to buy can be tough, but it boils down to your personal goals and preferences.
Niche doesn’t matter, although home and pet care are two of the most popular choices due to the wide variety of subcategories you can choose within them.
To make your search easier and quicker, make a due diligence list to help discount unqualified businesses. A few initial things to include in the list are the size of your budget, how much time you want to spend working on your business, and how many products the business sells.
We covered some due diligence criteria above when discussing the factors that affect the monthly multiple. Other due diligence criteria may include how many people the business employs and whether it faces any pre-existing legal issues.
What your due diligence checklist eventually looks like comes down to what your goal is in buying an FBA business. If you want an entry point to e-commerce and running your own business, you may be looking to buy a five-figure or low six-figure business with a few SKUs in a niche you’re familiar with.
Depending on your budget, you might be looking to buy an FBA business with room to expand. One that hasn’t been fully optimized by the current owner due to time or capital constraints. Your criteria will be different from those of the buyer in the previous example. You might be looking for distressed assets with a negative trend in profits and traffic, but that are still profitable.
Figure out what your overall goal is. Once you’ve identified what the ideal FBA business looks like in your due diligence checklist, all that’s left to do is to find the best deal for you.
Where to Buy Suitable FBA Businesses
If you’re a first-time buyer, we recommend using a broker’s service. A private sale provides little to no protection for buyers and sellers. It could take you a long time to sift through before you find qualified businesses that pass your checklist.
Many buyers think they can negotiate a great deal and pay less than a business’s worthwhile also avoiding paying a broker’s fee.
Experienced buyers can achieve such results. However, it’s less likely and demands a lot of experience in the negotiating and M&A arena.
If you don’t have that much experience, you can visit a curated marketplace offered by brokers. There, you’ll find businesses that meet a minimum standard of quality and perform more or less as advertised. You’ll also receive support and advice from an experienced team of business analysts who can help you find the right business based on your needs. This is the end of this guide on Due Diligence for Amazon FBA Businesses