2018 Sales Tax Rate Changes Sellers Should Know About – Guest Post by Avalara

Change is a constant with sales tax. Thousands of sales tax changes occur annually, affecting rates, rules, and regulations: Exemptions expire and are imposed on new products; rates increase and decrease; jurisdictions expand, contract, or even cease to exist; and so forth. Such changes affect any retailer making sales in the affected jurisdiction. But many of the changes coming in 2018 target online sellers in general, and specifically Amazon’s marketplace vendors.

States target online marketplace sellers

Online marketplace sales topped $1 trillion in 2016, according to an Internet Retailer research report. Yet state sales tax revenue isn’t sharing the meteoric rise of the internet marketplace. In fact, the U.S. Government Accountability Office reports that states missed out on up to $13 billion in tax revenue from untaxed remote sales in 2017 alone, roughly $6 billion of which was from online marketplace sales.

Therefore, states are redoubling their efforts to let no online sale go untaxed. Now that Amazon is collecting tax on sales of its own products in all states that have a sales tax, states are targeting marketplace sellers that, until recently, largely escaped the attention of state tax authorities.

New remote seller requirements took effect in Maine and Rhode Island in late 2017. Washington state is taxing marketplace sales as of Jan. 1, 2018. Under a new law in Pennsylvania, referrers, remote sellers, and marketplace facilitators must collect tax on their sales by March 1 of this year. A similar law in Minnesota, the first to be enacted, is scheduled to take effect on July 1, 2019.

Yet these aren’t the only laws targeting non-collecting remote sellers. In Virginia, out-of-state vendors that store property in an in-state warehouse or shipping facility, even one owned by another party, are considered to have a physical presence in the state and an obligation to collect and remit tax on their Virginia sales. And as of Dec. 1, 2017, certain remote vendors who “purposefully or systematically exploit the Mississippi market” are considered liable for tax on their sales in Mississippi.

Furthermore, a handful of states may have found an effective way to work around the physical presence precedent that has long prevented states from taxing remote retailers. Connecticut, Massachusetts, Ohio, and Rhode Island now maintain that the presence of software or web cookies on an in-state device establishes a physical presence and an obligation to collect and remit tax. Legal action is pending over at least two of these policies; if the states emerge victorious, others may follow their lead.

All’s fair in love and sales tax

That’s what’s happened with Colorado’s use tax notification and reporting requirement, which the Supreme Court of the United States let stand. Vermont, Washington, and several other states have enacted similarly onerous reporting requirements on non-collecting retailers.

The full impact of these requirements has yet to hit. In the coming months, residents of states with use tax reporting laws will start receiving reports of their purchase activity from non-collecting vendors. They’ll be informed that the vendors are required to send similar information to the state tax authorities. How would you react to such news? Would you rather pay tax at checkout, or have your personal information turned over to the state?

The trend is clear: States will not stop until they can collect tax revenue from most, if not all, remote sellers. If that happens, retailers that don’t currently collect will need to deal with rate changes, new and expiring exemptions, and other state and local sales tax changes.

See more 2018 sales tax changes at the Avalara blog.

 

5 Tips for Product Photography from Viral Launch Lead Photographer Dustin Kessler (Follow the Data Ep. 21)

5 Tips for Product Photography from Viral Launch Lead Photographer Dustin Kessler (Follow the Data Ep. 21)

Having high-quality images of your product is integral to your success on Amazon. Photos can make or break your sales, especially in the age of Amazon where the primary indication of what your product is like comes from your photos. Join host Cameron Yoder for a conversation with Lead Viral Launch Photographer Dustin Kessler where he reveals 5 tips for creating better Amazon photos. 

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Follow the Data Show Notes

Podcast Transcript

CAMERON YODER:
To click or not to click, that is the question. Really, though, that’s the question that shoppers are asking themselves as they scroll through Amazon search results. And one of their main considerations as their eyes quickly pass over the page is product photography. Having high-quality images of your product is integral to your success on Amazon, encouraging shoppers to click and convincing them to purchase. Photos can make or break your sales, especially in the age of Amazon where the primary indication of what your product is like comes from your photos.

I’m Cameron Yoder, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 30,000 product launches and our experience working with 6500 brands to help you understand the big picture when it comes to Amazon and, more importantly, the best practices for success as an Amazon seller.
In today’s episode I sit down with our lead photographer, Dustin Kessler, to talk about the best practices for product photography, what to do, what not to do and why a professional photographer is worth the investment. Let’s jump in.
Dustin, how are you doing today?

DUSTIN KESSLER:
I’m doing pretty good. It’s a Friday, and we’re killing at the office, getting a lot of stuff done. Excited to be here.

CAMERON YODER:
Dustin is excited to be here. We are killing at the office. We’re in a time of transition right now. We’re actually doing some construction on the office, opening up the space a little bit as our team continues to grow.

So Dustin, I want to introduce Dustin a little bit, and then I’m going to have him talk about himself just a little bit, too, but Dustin is our lead photographer at Viral Launch, and he has over a decade of experience in commercial photography specifically. And he’s worked with clients ranging from local coffee shops to Fortune 500 companies like Samsung and Walmart. It’s pretty crazy. He’s also done a ton of product photography with Amazon and Viral Launch specifically. So Dustin, maybe intro yourself a little bit. Also maybe answer first how many products do you think you’ve shot for Amazon specifically?

DUSTIN KESSLER:
For Amazon specifically I would probably say – I mean it’s definitely in the hundreds if not more than that, but I kind of – you know, I got into photography over 10 years ago now, just kind of picked it up as a hobby, really, really enjoyed it, started doing a lot of research. I’m the type of person when I get into something I really just like throw my entire self into it and learn as much as I can. So I picked it up in high school, ended up going to college for it, and about halfway through college I fell in love with just the idea of commercial photography, of telling a story through a scene, a product, lifestyle from the automotive field, to product, to fashion, whatever it was, just that entire commercial realm is kind of what I fell in love with. So it’s been a really interesting journey since then. I’ve done a lot of different things from, you know, just local coffee shops, helping them grow and helping them, you know, have this visual presence in this digital age, whether it’s through social media, or ad campaigns, email campaigns, anything like that, to working with, you know, huge Fortune 500 companies like Samsung and Walmart and others just to name a few. But it’s been a great journey, and I’m excited to be at Viral Launch, and we’ve done a lot of great things for a lot of great people. So looking forward to continuing that.

CAMERON YODER:
Yeah, I think one thing that a lot of people forget, especially in this space – well, a lot of people kind of forget to, number one, get a hold of fantastic photos.

DUSTIN KESSLER:
Sure.

CAMERON YODER:
But also the importance of telling a story with photos is something that not a lot of people know of, and that’s something that – I mean you, you are really passionate about, but it’s something that is hard for people in, I think that are selling on Amazon, to really see. And so today I’m really excited to kind of just pick Dustin’s brain for all of our listeners when it comes to photography specifically on Amazon because this is a space that’s really important. It’s something that’s going to capture your audience’s attention first on Amazon, one of the first things that they see. So Dustin, if you could, maybe break down a handful of tips that you have for us. What would be maybe one of your first tips that you would tell people, that you would tell our audience when it comes to photography on Amazon?

DUSTIN KESSLER:
So with Amazon, you know, you don’t have a physical product in front of you, right? You only see – you only see what the seller is showing you through their listing, whether it’s your photos or it’s your text, whatever it is. So you don’t have that product in front of you. You can’t have it in your hands. You can’t have that like tactile like oh, this is what the product is, right? So the biggest thing when it comes to e-commerce photography, and in this case Amazon photography specifically, is you have to be able to tell a story with your product, right? You have to be able to show your product in a way that makes people relate to it, makes people think oh yeah, I can definitely see that product in my house. I can see that product in my life being used for whatever purposes I decide to use it for. And you know, if you have – if you just have that main image, that main studio white background image, yeah, it could be the nicest main image in the world, but if you have nothing to follow it up with, you know, what story is that telling people? What is that relating to people? It’s just saying hey, here’s a product, right?

CAMERON YODER:
So that story then, that story is what evokes an emotional response, right? So the whole – this kind of falls into the idea that your photography should evoke an emotional response from a customer looking at your photos. And so is that accomplished then by the story, essentially?

DUSTIN KESSLER:
I would definitely say so. You know, there’s that phrase that a picture says a thousand words. When it comes to product photography and telling a story through your product it’s not as much you as the seller saying these thousand words. You want your photos to say that. You want your photos to develop the story of their own and evoke that emotional response within the potential buyers because each buyer is going to be different. They’re going to look at the same products and the same story that you present, but if it doesn’t tell the story of your product well enough it’s not going to relate with them.

CAMERON YODER:
I do – I want to focus on this a lot because I think this is maybe – this is a very important aspect of product photography on Amazon. Could you give us – I see maybe listeners asking, okay, or telling themselves hey, okay, now I know that I should tell a story with my product, but can you give us like a comparable example of what that would be just for any random, like any random product on Amazon, what would telling a story for something like, I don’t know, oven mitts or like a grill brush look like?

DUSTIN KESSLER:
So we’ll take – we’ll take like the grill brush, for an example. You – per Amazon’s terms of service obviously you have to have a white background image as your main image, and at the end of the day there’s only so many ways that you can, you know, that you can slice that cake for the main image. You can pose it different ways, try to fill up as much of the frame, have like a badge on there, even though that’s a whole other, that’s a whole other story in itself. But there’s only so many ways that you can do that main hero image. But if you light it correctly, make sure it’s good, the product is in focus, like those are the main pillars for that main image. But then once you get into that story itself with those images with this grill brush, like there are so many different ways that you can use this product, right? Whether it’s, you know, getting flavor onto chicken as its grilling, or a burger, or a steak, whatever you’re using on the grill. Like there’s so many different ways that you can use it, and being able to tell that story of those uses is really important. But you also have to remember other aspects of the product. Is it dishwasher safe? Is it, you know, is there a certain temperature of liquid, stuff like that, where most people when they’re just taking a picture of their product they’re like okay, I’m going to take a picture of the product out of the box, in the box and then maybe next to a grill, right? There are so many different ways that you can show that product in use and tell that visual story.

CAMERON YODER:
Do you think there’s a – is there a benefit to telling that story through like a linear progression of how it’s used, so like oh, you open up the grill, like you put the grill brush in the grill, you wash the grill brush after, whatever? What do you think; is there a method to having a linear progression, or not necessarily?

DUSTIN KESSLER:
I think there’s definitely a lot to say for having that linear method of photos. That’s one thing that we do for our clients specifically is when we send them out a photo set, a completed photo set, we generally try to lay out the photos in what the best story that we feel would look like. And you know, say hey, upload these photos in this order and see what your conversions are like in this way. At the end of the day it’s each person’s prerogative whether or not they put it in that order. I think there is something to be said for that story, though, in that order because it, you know, it shows somebody something from start to finish.

CAMERON YODER:
Right.

DUSTIN KESSLER:
It’s like reading a visual book where you open page one, and you’re like okay this is the product. Open page two, this is where you start using the product. And by the end you see the entire progression of that story.

CAMERON YODER:
That’s good. So okay, tip number one, tell a story. What about, what’s another tip?

DUSTIN KESSLER:
I would say something that a lot of people don’t necessarily think about, and this may just be because people aren’t trained to think this way, is correctly lighting your product. There’s a lot – there’s a lot that goes into photographing products so features stick out, but also making sure that just the product overall looks very appealing. You can have a beautiful looking product, but if you shoot it and light it incorrectly it could look really boring. It could look – the image can look really flat. There could be, you know, no emotion evoked from that image, and that’s not something you want to do. Another thing that like in this digital age that we see people doing is the convenience of having cell phones with pretty good cameras, honestly, is both a blessing and a curse. But in the Amazon space I would go with the latter because you can take a photo of your product on your phone. It will look great, you know, it will look nice and crisp and bright, but that’s on your phone. Once you get it on to Amazon and you put it next to professional photographs, you know, maybe your background isn’t completely white. Maybe it doesn’t stick out as much. Maybe it isn’t quite as in focus as you thought. So there’s these things that are convenient for everyday life that aren’t necessarily convenient for product photography on Amazon. Because if you have a cell phone photo next to a professional photograph you’re going to tell a difference.

CAMERON YODER:
Oh yeah, absolutely.

DUSTIN KESSLER:
Especially with the white background photos.

CAMERON YODER:
Let’s say someone – let’s say someone listening bought, like just bought a starter kit, like a photography lighting starter kit. So they have maybe a handful of semi-good, semi-good equipment to use for product photography, but they’re not the best, maybe the most professional photographer, but they have good, like decent lighting equipment. What’s a really simple recommendation that you would give them on how to really just enhance or make the most of simple lighting equipment?

DUSTIN KESSLER:
So generally most like photography studio starter kits are a white like backdrop box, which most of the time we call a lightbox in the industry, two to three lights that they can set up, and obviously whatever camera they’re using, right? So that’s generally the starter package for when people buy like basic studio equipment. I would say YouTube is your best friend, especially if you’re the type of person that you’re eager to learn, you’re willing to do and put the work in that is required to learn these things to better your Amazon business. YouTube is definitely your friend. Look up lighting tutorials and stuff like that for product photography specifically because there’s going to be a difference between, you know, lighting a portrait and then lighting a bottle, right? It’s just going to look completely different. So I would definitely suggest people, you know, jump on YouTube. Go spend 30 minutes a day and learn because at the end of the day learning more stuff is not a bad thing.

CAMERON YODER:
Right, right. That’s right. Well, okay, what about, what’s another general tip that you would give everybody?

DUSTIN KESSLER:
So this is a tip that I think a lot of people kind of overlook, and it is don’t overload all of your images with text and graphics. This is something that we see sellers doing all the time on Amazon, whether it’s on your main image, which if you put text and graphics on your main image you run the possibility of getting it flagged and taken down. Obviously nobody wants that. But just in general, in the rest of your photo stack on Amazon having so many words and all this text and all these graphics and callouts, like for some products it’s beneficial, but that’s the minority of products. At the end of the day your photos should speak for themselves.

CAMERON YODER:
Where is the line? What is too much?

DUSTIN KESSLER:
I think too much is when you’re trying to basically copy every single one of your bullet points and put it on all of your photos, and I think that a lot of people try to do that. They try to condense their bullet points into – or don’t, or just literally copy their bullet points and put it on the photos. Or for like a mop with, you know, a telescoping handle, you don’t necessarily need to show a photo that has six additional detail photos of how to turn the handle. It’s pretty intuitive, right?

CAMERON YODER:
Yeah, it is.

DUSTIN KESSLER:
And there’s always – there’s always room for putting that text and putting those extra graphics on like a card that you put in the box. That’s how a lot of instruction manuals in most products in retail stores or companies that have been doing products for, you know, 40, 50 years, they have instruction manuals for a reason. You don’t necessarily have to have an instruction manual in your photo stack, and a lot of people get hung up on trying to explain so much about their product when 99% of people are going to be able to figure it out on their own. And it distracts from the image, and it gives you less room to tell that story and evoke that emotional response like we talked about at the beginning. And if you are not evoking that emotional response right away you’ve already lost that person. You only have a couple seconds to effectively communicate what your product is and what it’s about and really relate to that person. And if it’s – you know, if somebody’s looking at a photo and they’re not sure where to look because there’s text everywhere, you’ve already lost their interest.

CAMERON YODER:
This is one specific area that I think a large majority of sellers on Amazon that have graphics fall into, text or graphics overlaying in images, fall into the category of it being a bit much, right, of it being too much.

DUSTIN KESSLER:
Absolutely.

CAMERON YODER:
So if you’re going to include text or graphics in your images I would really encourage you to be really intentional about it. Ask yourself if you need that text or if you need that graphic. Again, it can work really well, but since most sellers seem to fall in the latter category of it being a bit much I would really be careful with how you use it.

DUSTIN KESSLER:
And I would recommend like – some of the text and graphics that I see as beneficial are actually things that don’t necessarily relate to the product specifically, but more the seller in the sense of okay, if you have a product in a market that you see competitors with reviews about getting, about products being returned because of, you know, an issue or a defect or something like that and it seems to be a consistent trend, if you’re going to make it your company policy to have, you know, a moneyback guarantee maybe throw that up there as a graphic on one of your photos in your stack. Things like that I can see being beneficial, but trying to take your entire listing and throw it on your product in the graphics just, it looks tacky, and it looks like an ad, and it doesn’t evoke an emotional response at all.

CAMERON YODER:
All right. What’s tip number four?

DUSTIN KESSLER:
You get what you pay for. Quality is definitely worth the money. You can look up plenty of examples of, you know, big Fortune 500 companies skimping out on photographs. They’ll just hire, you know, somebody with a camera. They won’t do their homework on them. They won’t set a standard for what is worth the money and what isn’t. And it starts to go down a very slippery slope of who can I pay the cheapest amount of money just to get photos done.

CAMERON YODER:
What would your vetting process be? What would your vetting process – let’s say you’re not spending – let’s say you want to save money and you don’t want to spend an absurd amount of money on a professional photographer, but you still want really good quality. What would your vetting process be for good photographers?

DUSTIN KESSLER:
Definitely the way that people present themselves. Do your homework. That’s the biggest thing. Do your homework and shop around. If you go to a photographer’s website and you see some photos that you really like, do you think it can translate into your product? That’s a big thing of okay, I found this incredible wedding photographer. She’s awesome, or maybe it’s a person that shot your wedding. Photos turned out amazing, but there’s no way that they could, you know, translate that into photography for your specific product. So definitely look for people that are well versed with product photography. It’s worth the time to do your homework and shop around because if you just hire any photographer they could be great in one area but not great for your product.

CAMERON YODER:
Really like if you have – if your goal is to increase your sales and you have just bad photos it’s not going to happen, right?

DUSTIN KESSLER:
Right, exactly.

CAMERON YODER:
Right.

DUSTIN KESSLER:
And then you’re going to be, you know, you’re going to have paid for the service. You’re going to have paid for these photos, and you’re not going to improve your business at all. So it’s worth the time to wait a little bit to find the right photos or the right photographer, I should say, than just paying somebody to do your photos because you’re essentially losing money at that point. Photography is an investment.

CAMERON YODER:
Yes.

DUSTIN KESSLER:
And if you’re going to put money into an investment you want to make sure that you have the most probability to win at the end of the day.

CAMERON YODER:
I like to think of it like this. Think about how you’re paying for photos one time. It’s not a subscription. It’s not anything like that. It’s a single payment, and sure, it might be an initial upfront investment for you. However, think about how much more money you’re going to make after the fact you have these photos in hand, and customers seeing these professional photos done, think of how many more customers are going to buy your product because of those photos. It’s an upfront investment, but it’s going to make you so much more money and save you so much more time than the alternative, which is not having professional photos done. So tip number four, quality photos. Do you have anything else you wanted to add to that?

DUSTIN KESSLER:
To that, just kind of to make an example I guess for a lot of people listening, kind of going to bring back that wedding photography. A lot of people have experience with wedding photography in the sense that either they know somebody that’s had wedding photography done, they’ve had it done themselves, whichever it is. If you hire a really good wedding photographer the images that you get back you’re going to remember forever. If you hire a not so great wedding photographer and the images you get back are subpar, you’re going to remember your day. You’re not going to remember the photos. And it’s the same with product photography. If you hire somebody just to take photos of your product, potential buyers, they’ll click on it, and then they’re going to forget the image. If you hire somebody who knows what they’re doing and can tell an emotional story with your product and elicit that response, those people are going to remember that photo, which means they’re going to remember your product. So kind of to draw all back to that, like quality is worth the money, especially to make sure people remember who you are.

CAMERON YODER:
That’s good. What about, what’s your next tip? What’s the last tip you have?

DUSTIN KESSLER:
Brand perception can go a really, really long way with photos. Just a visual, just a visual overall, whether it’s photos or package design when somebody opens up a box, they’re very similar in the sense that you can really kind of put yourself on a pedestal as opposed to just on a shelf with everybody else. You can spend that initial investment, get those great photos, make people perceive that your product is really, really good. But if you don’t invest that money and that time into finding somebody that’s worthwhile to hire to do your photos, your brand perception is going to definitely hurt from that. And you can make yourself look really, really good, or you can make yourself look really, really bad. Like I said before, you could have the most beautiful, high-quality product on Amazon, but if you have terrible photos of it people are going to think it’s a terrible product.

CAMERON YODER:
That’s good. Perception of brand bleeds into perception of product, right? It’s all connected. What is the takeaway from all of this? From these five tips, what is a big takeaway for people?

DUSTIN KESSLER:
Hire a professional. If your engine needs to be replaced and you know nothing about cars you’re going to take it to a mechanic. If you need photos and you’re not a professional photographer or you’re not super excited about learning how to become a professional or at least put yourself at a professional level, hire a professional. It will save you so much time and money. It will save you credibility with your product, and it will give you a much better brand perception.

CAMERON YODER:
That’s really good. Five tips – five tips that really encompass, I think, again what Dustin said, the importance of photography and the importance to really hire a professional, but not only a professional, but a good professional when it comes to product photography specifically. So Dustin, can you actually – a couple more things. Can you touch on how your work with larger companies, like we said in the intro, with something like companies like Samsung and Walmart, can you touch on how work with them has really helped your product photography with Amazon in the Amazon space?

DUSTIN KESSLER:
A lot of times that I’ve done larger gigs for, you know, Fortune 500 companies, these bigger clients that have this significantly larger budget, you start to look at all of these things that go on behind the scenes in the shoot, and you’re like okay, how can I kind of like roll this into my own process and make this a lot easier? So whether it’s a location scout, a talent scout, stylists, anything like that, those are all – you know, those are all separate positions on these big shoots whereas with us we condense that all into the people that we hire. So you know, we hire these photographers that can be their own stylists, can be their own location scouts, can be their own model scouts and talent scouts and find the best location, the best people to present products very well. And I think that’s something that’s been very big about – or very important, I should say, that I’ve learned from these larger shoots. And like don’t get me wrong; having a huge team of people sometimes is really fun. It takes a lot more stress off your shoulders, and you don’t have to worry about so many different pieces of the puzzle. But learning how to be able to do all of that on your own and trust yourself and trust your judgment I think is really, really important as a professional photographer. It gives you more credibility, and it gives your work more emotion, I think, at the end of the day.

CAMERON YODER:
Yeah, that’s really good. I think that’s really good. That’s an important perspective to take, or to bring into the Amazon space specifically. It’s something that you can take other places, too, not just Amazon, but to others. So that’s really valuable. Can you – actually there is one more thing that I want to touch on. Can you touch on I think a lot of people either run into this or are in it without actually knowing it. But there are people that are married to their photos. Sometimes it’s really hard to actually see what’s wrong with something that you’ve created, right, because it’s yours. So how, how would you advise maybe breaking the perception of, or breaking someone away from being married to their photos if their photos aren’t the best? How can we work around this, people being married to their photos basically?

DUSTIN KESSLER:
Sure. You know, and I think everybody kind of goes through this when it comes to photography, whether you are a professional or a hobbyist or you, you know, you bought a photography starter kit and you’re taking photos of your product and, you know, you think they look really great. But then somebody comes in and says hey, actually these don’t show your product very well. These aren’t that good. They’re not well lit, whatever it is. People tend to – and not just hobbyists or anything like that. Professionals do it, too. People tend to put a lot of their emotion into photography, which is a good thing, but also if you don’t understand how to remove that emotion and remove yourself from your work any critique that could make you better is only going to make you more stuck in your ways.

You know, I had the blessing of being able to go through certain college courses that were really, really helpful in teaching critique and criticism and feedback. Not everybody has that, obviously, but the one thing I’ve learned from all of that is if you can step back and objectively look at all the criticism and feedback and suggestions and changes, even if you don’t implement any of it, if you can look at it as being helpful or look at it as a way that you can improve or just look at something differently, I think that’s the first step in creating better content. You know, there’s editors in fields for reasons because if you write, you know, you write something and then it just went straight to print, what if there’s typos? You know, that’s why editors exist. And with photography if you don’t have – if you’re just putting stuff out and you never have anybody look at it, check over it, and you don’t take feedback or criticism, you’re doing yourself and your potential customers a huge disservice.

One of the things we do here is, you know, every time a photo set is done and ready to go to a client we have at least two people do a quality control check on it. And if a coach sees it going out and is like hey, like this doesn’t look right, they’ll say something, too. And at the end of the day the goal is to effectively tell a story. I had an example for myself when I did my first magazine publication shoot. I was super excited. I was like yeah, my work’s going to get published in a magazine. That’s great. It was an automotive magazine. And I spent eight hours on this shoot, went home, uploaded all the photos, had a peer of mine that has always been kind of a mentor to me. I sent him these photos on Facebook. I was like hey, what do you think of these? I just finished it. This is for my first magazine. And I was like hey, how do these look? And he told me that they looked like trash, just straight up. He’s like look, I’m going to be blunt with you. These are not good. You should – I wouldn’t publish this. And yeah, it stung, but at the end of the day I knew that the goal was to publish really good content. So I rescheduled with the owner. We shot the car again. And it turned out to be probably one of my favorite shoots I’ve ever done. So being able to remove yourself from feedback and criticism, remove your emotions from your work is just, it goes so far.

CAMERON YODER:
I would really encourage people in this space to seek out criticism, to seek out someone to prove your photos wrong because really your goal should be to provide the best photos possible for the price range that you’re comfortable with. And I don’t know, seek out criticism. Well, Dustin, what is one thing that you want to leave our audience with?

DUSTIN KESSLER:
I think at the end of the day the thing that I would like to leave most people with is you get what you pay for. Just because somebody has a nice, fancy camera doesn’t mean that their photos are going to be amazing. So do your homework before you buy. Make sure that who you’re buying from for your photos is worth the money that you’re comfortable spending, and don’t be afraid to spend a little bit more to get that quality.

CAMERON YODER:
Well, thank you so much for being on the show, Dustin. There’s a lot of valuable information here for a lot of people on photography in general, but also photography when it comes to Amazon specifically. So thank you, Dustin, for being here.

DUSTIN KESSLER:
No problem. I enjoyed it.

CAMERON YODER:
Well that is all for this week. Thank you so much for listening to Follow the Data. For more insights and reliable information that will help take your Amazon business to the next level subscribe to the podcast and check us out on YouTube. I’ve been working on a series of product discovery walk-throughs that show you how to really leverage the tool. Just search for Viral Launch on YouTube. Go to our page and look for my face in one of those videos. And if you’re listening on iTunes, please leave us a review and let us know what you think of the show. And if you know another seller who’s feeling lost in the Amazon information war out there, send them our way. We want to be a resource for sellers and the information source in this space. So please tell your friends. Spread the word and share the show with other Amazon sellers. Thank you again so much for listening. And as always, if you want to be featured on the show, have an Amazon related question or an idea for an episode, feel absolutely free to leave us a voicemail. Our number is 317-721-6590. Until next time, remember, the data is out there.

3 Tips for Launching Your Next Product from Viral Launches Launch Director, Andrew Field (Follow the Data Ep. 20)

3 Tips for Launching Your Next Product from Viral Launches Launch Director, Andrew Field (Follow the Data Ep. 20)

Viral Launch has long been known as a successful launch platform, pushing products up to Page One in just a number of days. But to get your product to the top and make it stick, there are a few things you need to have in place. Join host Cameron Yoder for a conversation with Viral Launch Launch Director and employee #1, Andrew Field where he reveals 3 tips for ensuring a successful launch. 

 

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Follow the Data Show Notes

Podcast Transcript

CAMERON YODER:
Page 1, the coveted seat of Amazon’s top-selling products, the only place where shoppers are really looking or purchasing. If you want to sell well, you’ve got to get your product to Page 1. Viral Launch has long been known as a successful launch platform, pushing products up to Page 1 in just a number of days. But to get your product to the top and make it stick there are a few things that you need to have in place.

I’m Cameron Yoder, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 30,000 product launches and our experience working with 6500 brands to help you understand the big picture when it comes to Amazon and, more importantly, the best practices for success as an Amazon seller.
In today’s episode we sit down with our Launch Director, Andrew Field, to talk about the best practices when it comes to launching a product and the strategy behind it all. So launching is an incredibly effective method when it comes to keyword ranking on Amazon. And today we’re going to dive into Andrew’s perspective on the dos and the don’ts when it comes to launching. Let’s jump in.

All right, so Andrew, how are you doing today?

ANDREW FIELD:
I’m doing great, man. Thanks for asking.

CAMERON YODER:
Doing great. Awesome. That’s good to hear. So just to introduce Andrew a little bit, I want to introduce him just because, just to validate his perspective, basically. So Andrew, believe it or not – well, believe it because it’s true – Andrew was employee number one at Viral Launch. Andrew, what do you have to say about that?

ANDREW FIELD:
I mean it’s been crazy watching the company grow over the last almost three years, going from a team of just Casey and I to now 40+ people. It’s awesome.

CAMERON YODER:
Dang. Employee number one is not something that a lot of people can say, honestly. Like some people jump on early with a tech company or just a startup in general, but Andrew was literally the first employee, official employee of Viral Launch.

ANDREW FIELD:
Yes sir.

CAMERON YODER:
Which is insane. So he is our – he’s Viral Launch’s Launch Director. Also to just kind of say where Andrew started, Andrew started – well, Andrew, talk about where you started.

ANDREW FIELD:
So basically I started in kind of a customer service role. I was always scheduling launches, so any launch that comes in, someone submits a launch for X number of units over X number of days, I’ll review it, make sure everything works, make sure the URL is directing to the right product, just kind of oversee everything that goes into that launch.

CAMERON YODER:
Yeah, and you’ve overseen a lot.

ANDREW FIELD:
Yeah, just over 31,000 now.

CAMERON YODER:
You’ve overseen over 31,000 launches. You’ve approved, personally approved –

ANDREW FIELD:
Roughly 25,000 of those, probably.

CAMERON YODER:
So personally approved roughly 20 – you said 20,000?

ANDREW FIELD:
25.

CAMERON YODER:
25,000 launches. So he’s worked with a lot of sellers, personally and through just Viral Launch’s system, to help get them to Page 1. So he’s seen a lot of what works and a lot of what doesn’t work when it comes to launching and ranking on Amazon. So he oversees our launch platform, and he’s just seen a large number of people pass through the system. And that is what we’re working with today. Andrew’s perspective is very valuable, and is something that I think a lot of listeners here can benefit from. So Andrew, just to kick it off, I’m sure many people are familiar with this, but could you just outline what a launch is?

ANDREW FIELD:
So basically the idea of a launch is to get your product to match or exceed the number of sales for listings on Page 1 for your targeted keyword. So for example, like if a product – you want to get your product raking on Page 1 for a keyword where the average number of sales is right around 1000, we’d recommend probably around 200 to 250 units over like 7 to 10 days. And the idea is to drive all of those discounted sales through the targeted keyword to get your product to match the sales history and sales volume for the listings that are ranking on Page 1 currently.

CAMERON YODER:
Okay, so just to like put it into a good perspective, the definition that we’re using today of a launch and/or promotion is basically looking at the sales on Page 1 for a keyword and matching those sales through something like a launch to get you to Page 1 –

ANDREW FIELD:
Exactly.

CAMERON YODER:
– for that keyword. Okay. So can you break down – again, we’re going to get into more strategy as we move on, but can you break down just how a launch works from start to finish? You already talked about it a little bit, but just kind of break it down for everyone.

ANDREW FIELD:
Yeah, so it depends on if a seller works with a coach or not. Generally if a seller works with a coach their launch is successful. So we have the knowledge to look at a market and say okay, you need to give away this many units to get ranking for this keyword. Maybe we would notice that this keyword might not convert well for you, so you probably shouldn’t target that keyword. So it depends on the keyword you’re going after. So we would look at the market to see what kind of sales they are doing and then base a recommendation off of that.

CAMERON YODER:
Okay, that’s good. So let’s talk about – let’s outline – I want to outline three strategy tips that you have for people. Just what would your three top tips for people be when it comes to running promotions or product launches?

ANDREW FIELD:
Yeah, so first thing you want to make sure you have a well-optimized listing. So if your copy is bad or your photos are bad, that listing is not going to convert well once it’s ranking on Page 1. You want to make sure you have a competitive price point. So if your listing is 35% higher than every listing on Page 1, you’re probably not going to convert that well.

CAMERON YODER:
Right.

ANDREW FIELD:
And you also want to make sure that you’re targeting the best keywords. So kind of the best way to figure out what the best keyword is, is to do a lot of research. So you want to look at many different keywords that you would consider relevant and then see which products on Page 1 are most comparable to the listing that you have. So if you see a bunch of products on Page 1 that aren’t necessarily similar to your listing it’s likely that you won’t convert well for that keyword. And if you see a bunch of products on Page 1 that are very similar to your listing, those listings are obviously converting well for that keyword, so it’s likely that yours would as well.

CAMERON YODER:
Right. So let’s, so just to go over those three tips that you mentioned, that’s number one, you said optimize your listing. Number two, you said competitive – have a competitive price point, really. And number three was targeting the most effective keywords, right?

ANDREW FIELD:
Yep.

CAMERON YODER:
So let’s break down – let’s break down each of these. So number one, you talked about – and you went over it a little bit, but specifically when giving advice to people about optimizing their listing, like again, out of everyone that you’ve seen, what works well from the perspective of the seller that should be optimizing his or her listing?

ANDREW FIELD:
So first and foremost you want to make sure you have a great title. Keyword rich, still reads well, but is going to help you rank for as many relevant keywords as possible. Some of the data that we’ve seen – so somebody runs a launch that should work based on the number of units that we recommend. We do a reassessment and see that the targeted keyword was not in their title. That can cause them not to be able to rank for that keyword. They may be indexing, but they’re not getting the same ranking power as they would be if they had that keyword in their title.

CAMERON YODER:
Now what about – can you break down the importance of a title in a product’s copy compared to something like the bullets or the description?

ANDREW FIELD:
So the title is going to be your most important. That’s where you’re going to get the biggest bang for your buck. Your most important keywords you want to put towards the beginning of the title. The less important keywords you move towards the back. But your most relevant keywords are going to be all focused on in your title. That’s where you’re going to get the most ranking effect when running launches.

CAMERON YODER:
And in your perspective, again, just from what you’ve seen with data and with launches, is there any – should people just cram a bunch of primary keywords together in the title or string them together like masterfully to create a title that makes sense, or like where’s the fine line between that?

ANDREW FIELD:
So there’s a perfect balance that you want to find. You want to find a balance between sales-inducing copy and copy that will also help you rank. So having a professionally-written listing is key, someone that knows the science behind writing a listing.

CAMERON YODER:
What about photos? What advice on photos do you have?

ANDREW FIELD:
So you want to have a photo that will catch the eye, just based on the thumbnail. So you’re main photo is going to be the one that drives the most clicks to your listing. So yeah, you want to make sure that your listing stands out from the competition with excellent photos. Once you get into the listing you’ll notice a lot of competition on Amazon likely doesn’t have lifestyle photos. That’s something that you can really give a competitive advantage to your listing if you have really nice lifestyle images showing the product in use. It helps develop an emotional attachment between the potential buyer and the product itself.

CAMERON YODER:
That’s good. I think with this first point talking about optimizing your listing, I think a lot of people get, just get lost from the fact that a product launch can get you to Page 1, right? But if those creatives are not in place, like if your copy is not optimized, if your photos are not great, then yeah, you’re going to lunch on to Page 1, but you’re not going to be able to convert once you’re there.

ANDREW FIELD:
Right.

CAMERON YODER:
And the whole goal of a launch, at least for us, our perspective is our goal for you is to reach Page 1 for that, or those primary keywords that you’re targeting and then to stick there. And your best chance of doing that, like you were just talking about Andrew, is to really optimize your title, your copy, the rest of your copy, and your photos.

ANDREW FIELD:
And definitely price point.

CAMERON YODER:
And definitely price point, right, which is your second point actually. That’s a really good lead-in. So your second point was to make sure your price point is in line with competition. Can you break that down just what you generally recommend?

ANDREW FIELD:
Yeah, so I mean that kind of starts even before sourcing a product. So if you can only source this product and you have to sell it at a substantially higher amount than other listings on Page 1, you probably won’t be able to convert. You probably won’t be able to compete in that market moving forward. Amazon is a space where you have to have the best priced product. You need to present your product in a great way, but you also have to offer a good value to the customer. Since most products on Amazon are private label nobody really knows and has an attachment to a specific name brand, so price point is going to be a huge converting factor for you.

CAMERON YODER:
And that’s what – and we talk about on the show all the time and in our videos and everything, the importance of really setting your goals before you even start the whole process of really sourcing anything because if you set your goals on what you want to make, then that will kind of determine the manufacturers that you choose or the products that you go after and the margins that you’re looking for.

ANDREW FIELD:
Exactly.

CAMERON YODER:
Because like you said, I mean if you can’t handle the margins or the price war, then – or if you get into a market that is an average of $20, right, and you’re trying to source a product that’s like $40 because it’s better –

ANDREW FIELD:
Right, it’s going to be very difficult to compete in that market.

CAMERON YODER:
Right. Okay.

ANDREW FIELD:
Even if you have a well-optimized listing, good copy, good photos, if your price point is twice as high as everyone else, best of luck to you.

CAMERON YODER:
Right. Let’s talk – let’s touch on the third point, your third point that you made, or the third tip, general tip. So you said make sure that you target the right keyword. I want you to – can you break down for us what you would really recommend when people are trying to find the best keywords to pick to rank for? What’s your advice when it comes to that?

ANDREW FIELD:
So yeah, I get that question all the time. Basically you want to look and see what other listings like yours are converting for. Even another way, just run like an automatic sponsored ads campaign. Let it run for 10 days. See what kind of conversion you get for these keywords. See how many impressions you get for this keyword. And find the one that performs the best. That’s typically going to be the best keyword for you to target with the launch.

CAMERON YODER:
Okay. Other than that, like what about – and we have Market Intelligence, right, which gives us access to like sales estimate data. Would you use that in that case?

ANDREW FIELD:
Right. Yeah, I mean to an extent. It’s almost difficult when you’re just looking at sales estimation data because you’re not sure which keywords those sales are being attributed from. Mostly it’s common sense. You can tell which keywords are going to be most relevant to your product. You can use tools like MerchantWords to find – I mean other sales estim- or search estimation data. But that’s not always all that accurate.

CAMERON YODER:
I really think people overthink the primary keywords where, again, there are always exceptions to this rule, but really chances are if you’re able to put yourself in the mind of a buyer or of someone who is buying your product, you’ll probably be able to narrow down maybe the top three primary keywords that you should at least look into with something like split testing.

ANDREW FIELD:
Yeah, and as far as finding the primary keyword, I don’t think that’s really all that difficult. If you look at your competition you’ll generally see that the primary keyword for that market is going to be at the very beginning of most all of your competitors’ titles. So that’s an easy way to identify the primary keyword.

CAMERON YODER:
Right, to look at your competition and see what they’re driving. And again, that doesn’t always mean they’re picking the right one, but typically –

ANDREW FIELD:
Right. If you see most sellers in a market doing that, that’s generally meaning that that’s the primary keyword for the product, yeah.

CAMERON YODER:
Right, right, that’s good. Okay, so those were the kind of three general strategy tips, but let’s break down just launch strategy in general even more. So Andrew, what would you say – what are some of the most important things that people should keep in mind before they do something like a launch?

ANDREW FIELD:
Yeah, so I mean we’ve already kind of touched on it, but make sure that your listing is well-optimized. You have to have great listing copy. You have to have great photos. You have to have a competitive price point. The question that people always ask is once I get to Page 1 will I stick? I think people are asking the wrong question, and the question should be, will I sell? Because what good is it if you stick on Page 1 if you don’t sell? You need to be asking the right questions. So if your listing is going to convert, if it’s going to be competitive with the other listings in the space, that’s the question you should be asking.

CAMERON YODER:
What would you say about reviews?

ANDREW FIELD:
I mean reviews are important. I think we’ve kind of talked about this on the podcast before. Reviews are the currency of Amazon. That’s another thing that kind of goes into the optimization conversation. If your listing has far fewer reviews than other listings on Page 1 for that keyword, you’re going to find it more difficult to convert. Sometimes what we suggest right after running a launch is to drop your price a little bit, sometimes almost even to breakeven, just to generate sales, develop a strong sales history, keep that product on Page 1, and then you can gradually bring your price back up to like increase your margins.

CAMERON YODER:
Would you say there is like a flat number of reviews that someone should have before they run a launch, or is it kind of just dependent on the market that you’re going into?

ANDREW FIELD:
Yeah, it’s completely dependent on the market. I mean you’ll find brand-new markets out there where the average review count is 10 reviews. You can run a launch on that product with zero reviews. You’d have no problem. But if you’re going into a market where the average review count is 500 reviews, you’re going to find it a lot more difficult to convert with zero reviews. So I mean if you’re looking for a flat number – so for example, like for a market with 500 reviews as the average review count for listings on Page 1, I would suggest launching with no less than 100. That’s kind of my suggestion, so maybe 20% of the average of listings on Page 1.

CAMERON YODER:
Yeah, I think that’s a good baseline to build off of at least. Okay, that’s good. So next question, what do you see people doing wrong when it comes to promotions or launches? So what shouldn’t people do?

ANDREW FIELD:
So I think sometimes people have unrealistic expectations for how their product is going to perform after a launch. So getting a product ranking on Page 1 generally isn’t a problem. It’s typically pretty easy. But people think that all of a sudden their sales are going to skyrocket, which may not necessarily be the case. If your listing isn’t competitive you’re not going to see those sales. I know we keep going back to the having an optimized listing, but that’s how important it really is.

CAMERON YODER:
It’s important. It’s really important.

ANDREW FIELD:
Yeah, so I mean that’s why I think people need to discuss their strategy with a coach or a seller coach or someone that knows what they’re talking about before running a launch. Ask questions like will this listing sell in this market? Am I targeting the right keyword? How many units should I give to target this keyword? All those kinds of things.

CAMERON YODER:
Yeah, and this is not a – it’s not a plug for what we do. It’s just simply a really simple and easy thing that you guys can do and have free, really free access to.

ANDREW FIELD:
Yeah, exactly. Like no matter what strategy you’re using to get your product ranking on Page 1, these are the questions you need to be asking.

CAMERON YODER:
Right.

ANDREW FIELD:
Talking to people with experience is just a great resource for you.

CAMERON YODER:
Right, and that’s what our coaching team – our coaching team is meant to really give strategy to people.

ANDREW FIELD:
Exactly.

CAMERON YODER:
So they’re accessible to you. Okay, so let’s see. We see a lot of people, and we actually have – Casey and I have talked about this on the show before, too, but it’s always important to bring up because it comes up frequently, and it’s funny how often or how periodic this question comes up from people that are performing launches or thinking about performing a launch. But we see a lot of people talking, again, about how steep discounts don’t attribute ranking anymore. So what have you seen when it comes to that?

ANDREW FIELD:
Yeah, so I mean, like we said at the very beginning, I was employee number one. I’ve been giving launch suggestions for three years now. This has come up periodically forever. I mean I don’t think it will ever really go away. People are always looking for a reason not to give their product away at 90% off, which would totally understand. Nobody wants to give their product away at 90% off. But the data does not show that it doesn’t work. It still does work. Just for a specific example, just in the last like 14 days we ran three launches for a turmeric product, or three separate turmeric products. We got each one of those listings ranking on Page 1 for turmeric, turmeric curcumin and curcumin. Those are incredibly competitive markets where sales are 10,000+ a month. If 90% off promotions didn’t work there is no way that we would have been able to get those products ranking there.

CAMERON YODER:
Right.

ANDREW FIELD:
So we just kind of let the data speak for itself. There is always going to be those rumors out there, but as long as the data is there to combat it, I mean I don’t see it being an issue.

CAMERON YODER:
And that’s if – and that’s not to say that that could not change in the future, right?

ANDREW FIELD:
Right.

CAMERON YODER:
Because Amazon could pull a lever or something and all of a sudden maybe somehow, whether it’s accidental or intentional, make promotions not attribute ranking through stuff like that.

ANDREW FIELD:
Yeah, absolutely. That’s been a topic of discussion forever. But as of right now that’s not happening.

CAMERON YODER:
Exactly. And it’s not like we will hide that information from you. Like –

ANDREW FIELD:
Right. I mean there’s no point in us running launches if they don’t work.

CAMERON YODER:
Exactly.

ANDREW FIELD:
Yeah, I mean if launches don’t work we’re going to be straight up and say okay yeah, this strategy probably won’t work. Maybe there’s something else that we can try.

CAMERON YODER:
Right, and that’s why it’s important for us to keep you guys updated, at least from what we’re seeing with our launches since we run so many every single day and since Andrew has seen so many. It’s really important to help you guys know where we’re at and what we’re seeing. And what we’re seeing is that steep discounts still do work when it comes to product launches. Okay, so let’s see. When people are performing a launch, when they’re in the middle of the launch – dang it. Hang on. I lost my place. Oh yeah, yeah, okay. So let’s talk about when people are in the middle of a launch or a promotion. Will people, or should people expect to see results right away, or when should they expect to see something happen when it comes to keyword ranking?

ANDREW FIELD:
So my – like my typical launch suggestion lasts for 10 days, usually 10 days, seven to 10 days. Usually people will start to see ranking improve around day five. So during a launch you can expect to see a lot of different things. You can expect to see a big fluctuation in BSR, both up and down, big fluctuation in ranking, both up and down. But right around day five it typically starts to stabilize. So at day five you’ll start to see ranking like steadily increase. So like let’s say if you start on Page 3 for your targeted keyword. You might jump down to Page 6 during the first two days. Day three comes around and you’re back up to Page 3. Day five comes around, you’re creeping up Page 2. Day six, day seven, day eight, you’re moving up Page 1. That’s the typical – that’s typically what it looks like.

CAMERON YODER:
People tend to freak out when they’re on like day two of a launch, right? Yeah, explain that. Like they’re on day two of a launch and they see the product went down in ranking. They’re like what in the world? What just happened?

ANDREW FIELD:
Right, yeah. So I mean that’s just part of Amazon’s algorithm. That’s where people – I think that might even be where some of these rumors are stemming from where people run launches for like quote unquote tests, and after two days they’ve dropped to page 20 and they freak out, right? Let that launch run its course, and it will work. If you end prematurely you’re hurting your sales history, and it’s just going to cause problems down the road. Let that launch run, and you’ll see ranking improvement as long as you’re running with the appropriate strategy, of course.

CAMERON YODER:
And some of these – so some of these questions or this data is like dependent on the market, too. This specific question. Let’s say someone reaches Page 1 for their primary keyword before they expected to, like maybe before their expected launch day or the end of the launch.

ANDREW FIELD:
Sure.

CAMERON YODER:
Would you recommend that people stop their launch early, or just like kind of let it ride for a little bit?

ANDREW FIELD:
Yeah, that’s a good question. So if a listing reaches Page 1 and organic sales pick up to match the listing, the other listings on Page 1, then yeah, I mean go ahead and end that launch. There’s no reason to give products away at that point. If you get to Page 1 and sales pick up just a little bit you may want to let that launch continue so you can build a stronger sales history and maintain that Page 1 ranking, and then you can see organic sales coming in in the future.

CAMERON YODER:
Now what would you advise when considering launch numbers specifically? So like when somebody wants to find out the number of units that they should give away or the number of units they should put a heavy or steep discount on, what would you say to that?

ANDREW FIELD:
Yeah, so I mean this is going to sound like a plug for Viral Launch, obviously, but Market Intelligence, a great place to start. Analyze the market. Analyze that keyword. See what listings on Page 1 are doing in terms of sales volume. And you want to match that with your promotion. So generally, to develop a strong sales history you want to have your launch last for at least seven days, sometimes more. So seven days is kind of like the window where you need to run a launch for at least seven days to develop a strong enough sales history to maintain Page 1, or to even get ranking on Page 1. The additional three days that I usually recommend on the end of that are to help develop an even stronger sales history. So once the steady flow of promotional sales stops you’re able to stay there longer and generate organic sales recurring.

CAMERON YODER:
What would you say, what would you talk about post launch strategy? What’s the best strategy people can implement after an initial promotion if they run one for a keyword?

ANDREW FIELD:
Yeah, so after your initial launch you’re likely ranking on Page 1 for your primary keyword. If your listing is competitive you’ll probably start seeing an increase in organic sales right away. But let’s talk about a scenario where maybe your product isn’t just as competitive as all the other listings on Page 1. I kind of alluded to it earlier, but like some of the recommendations we have are to drop your price a little bit. Develop a stronger sales history for that keyword. Other things you can do – I’ve got to think about this for a second.

CAMERON YODER:
Yeah, yeah. No, you’re good.

ANDREW FIELD:
I had a bunch of stuff for this, too. Yeah, so like another thing you can do is run another promotion for another keyword. The best way to see the most organic sales is to be ranking on Page 1 for as many relevant keywords as possible. So if you see that you have – you’re in a market where you have 10 relevant keywords that are all going to attribute to your aggregate sales you want to be ranking on Page 1 for all 10 of those keywords. You don’t want to just be ranking on Page 1 for one of those keywords, and then you’re only seeing 10% of the sales that you would be seeing if you were ranking on Page 1 for all of your relevant keywords. So generally I would say to target multiple keywords with multiple promotions.

CAMERON YODER:
Let’s say you have two primary keywords for a product. If you run a launch for one specific one, and let’s say they’re similar. Let’s say maybe they’re similar, but they’re different enough to where you would need to run two separate promotions to rank for both of them. If you run – let’s say you run a pretty like intense launch for one of the primary keywords and you get to Page 1 for that keyword. Have you seen ranking attributed to the other primary keyword in some cases?

ANDREW FIELD:
Oh yeah, absolutely. So that kind of goes back to having a good, or a well-optimized listing. If you have those keywords in your title, if you have the correct keyword sequences in your title – so for example, like if you have like a fish oil, fish oil is your main keyword. Another keyword would be fish oil supplements. If you have fish oil supplements in your title and you’re targeting fish oil with your promotion you’re going to see a good, a sizable increase in ranking for fish oil supplements. You may even reach Page 1 for that keyword with the launch targeting another keyword. So yeah, I mean this goes back to making sure that you have a well-optimized listing.

CAMERON YODER:
Yeah, I think it’s good to, if people are trying to decide whether they should run a promotion for two separate keywords or run one targeting both or what have you, I think it’s always good to maybe even run one really targeted one for the primary, like the main keyword in that case, fish oil, and then see where you end up for fish oil supplements. And then if you want to just run another promotion for that right off the bat, you know where your baseline is going to be after the ranking has been attributed from the primary.

ANDREW FIELD:
Yeah, no, that’s a really good analysis, yeah.

CAMERON YODER:
So Andrew, what else – do you have anything else that you want to tell people when it comes to launches, or launch strategy or launch data?

ANDREW FIELD:
Yeah, so get advice. Don’t try to go it alone if you don’t have any experience. There’s always someone out there with experience that has looked into hundreds of thousands or however many markets and has the experience to tell you okay, this is the keyword you should target, this is the kind of strategy that will get you there, this is what an idea listing looks like in this market. You should try to emulate that. These are what your competitors are doing. This is your primary keyword. There are so many intricacies that go into a launch that you really need – there’s no substitute for experience and going into all the data.

CAMERON YODER:
Well, Andrew, thank you so much for being on the show today. It really is good to have a perspective like yours since, I mean you’ve been around the block. You’ve seen it all. You’ve seen brands built from 0 to 100, literally, and you’ve seen a lot of product launches go through. So thank you for taking time to be here and giving advice to everybody.

ANDREW FIELD:
Yeah, thanks for having me, for sure.

CAMERON YODER:
I’ll do and outro, but for now –

Well hey, that is all for this week. Thank you so much for joining us here on Follow the Data. For more insights and reliable information on how to succeed on Amazon, subscribe to the podcast and check us out on YouTube. I’ve been working on a series of product discovery walk-throughs that will really help you understand how to leverage the tool. So just search Viral Launch on YouTube, and go to our page, and look for my face on one of the videos. And if you’re listening on iTunes it would seriously help us out so much if you would leave a review to let us know what you think of the show. And if you know another seller who’s feeling lost in the Amazon information war that’s out there, send them our way. We really want to be a resource for all sellers, and honestly, the information source in this space. So please tell your friends. Spread the word, and share the show with other Amazon sellers.

Thanks again for listening, and as always, if you want to be featured on the show, have an Amazon-related question or an idea for an episode, feel absolutely free to leave us a voicemail. Our number is 317-721-6590. Until next time, remember, the data is out there.

7 Tips for Your FBA Business from Casey Gauss (Follow the Data Ep. 15)

Follow the Data Episode 15: 3 Tips for your FBA Business from Casey Gauss

Merry Christmas listeners! We’ve got a present for you: 7 tips for your FBA business courtesy of our CEO, Casey Gauss. As you set your business goals for 2018, these tips will help you focus on what will take your business to the next level. Looking to sell for the first time? Even better. Listen closely for advice about what pitfalls to avoid and what will set you apart from other Amazon Sellers.

Listen on iTunes

Follow the Data Show Notes

  • Check out this brief overview or this longer walkthrough of Product Discovery to learn more about how Product Discovery leverages data to help you find the most profitable Amazon products to source.
  • Not sure how to use Market Intelligence? Here’s a full Market Intelligence walkthrough about how to get the most out of the tool.
  • Reinvesting your Q4 profits is the best way to get the most out of your extra earnings. Think about what seasonal products you might be able to turn around in time for upcoming Q1 holidays.
  • Looking for more reliable information from the Viral Launch? Check out our Dispelling Myths Series. Viral Launch takes on 4 common myths in the Amazon FBA community.
  • Want to be on the show? Have your own story of entrepreneurial success? We’re working on an episode that features our listeners! Leave us a voicemail at (317) 721-6590 with stories or questions about your Amazon business.

 

Podcast Transcript

CAMERON YODER:
Merry Christmas, everyone, and happy New Year. It’s the holiday season and the end of Q4 2017. As we head into 2018 we want to help you focus on what’s going to make your business as profitable and successful as possible.

CASEY GAUSS:
Today I’m giving out seven tips to grow your FBA business to help you get in the success mindset heading into the New Year. I am Casey Gauss.

CAMERON YODER:
And I’m Cameron Yoder, your hosts for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 28,000 product launches and our experience working with 6500 brands to help you understand the big picture when it comes to Amazon and, more importantly, the best practices for success as an Amazon seller. Let’s dive in.

CASEY GAUSS:
Cool, guys. So we’ll start kind of in the source, launch, dominate order. Tip number one coming to you through the kind of source perspective, tip number one is pay attention to the sales-to-review ratio when entering a market. Really what this means, you know, we call this the ROI ratio, but really what sales-to-review ratio is, it’s just a very simple calculation, estimated monthly sales divided by total review quantity, and really this is a calculation that does two things for you. One, it is showing you kind of what the reward is versus the amount of work you have to put in. So if I want the reward of selling 1000 units of this widget per month, then the amount of work I have to put in is to get to, you know, X number of reviews. So let’s say 100 reviews, right? So if I only need to get 100 reviews to sell 1000 units, that’s a sales review ratio of 10. And that sounds like a pretty awesome scenario considering or assuming that all the other metrics are good, so price point, margin and so forth. But you know that’s far better than having to get 10,000 reviews to sell 1000 units, right? So the sales-to-review ratio, just a really simple quick calculation to, you know, as this kind of litmus test for should I consider this market or not.

CAMERON YODER:
I’m still amazed at how many people don’t take this into consideration when entering new markets. And it’s a really simple concept. Like it doesn’t have to be that complicated. Really it makes sense if you’re looking at a market and you see a bunch of sales and a ton of reviews, then of course you’re going to have to, in order to compete well, have to get that review count up to match what the market’s at. But if you’re in a market with a low number of reviews and high sales, obviously that’s opportune for you to enter and do well.

CASEY GAUSS:
Yeah. Thanks, Cam. So tip number two, go wide, not deep. So a lot of people are always looking for that home run product that is going to, you know, make them wealthy overnight. We have a guy named Brock Johnson coming onto the podcast. In six months he sold like $6 million worth of one product. That’s a unicorn. It’s very tough to find unicorns if you’ve never seen one. So anyways, you know, it’s so much more practical to be able to go really wide and not very deep. So what that looks like is, you know, if I were jumping into selling on Amazon this is the strategy that I would take because this is what I see kind of a lot of people having success with. Anyways, what this looks like is going after products where maybe the maximum sales potential for that market is $10,000 or $15,000, $20,000, some fairly low amount. I guess it’s all relative because for a lot of people $10,000 a month is insane. But essentially what you’re looking to do is enter markets where competition is not very high and you know, there’s lessons in it for the big players with the big budgets who are going to, you know, maybe use black hat tactics against you or whatever to come into the market and try to hurt you and your business.

I see this all the time with supplements and cell phone cases and beauty products. You know, what happens is people end up – competitors will buy your products. They’ll say that they’re getting the products – you’re selling it new, but it’s coming used, you know, the seal was broken, or they up-vote your bad reviews, or they leave a bunch of bad reviews, or they leave a bunch of unverified five-star reviews to make it look like you are going and soliciting these reviews. There’s so many things that competitors will do, and it’s just such a headache to fight in these markets, especially if the markets are mature. It takes a lot of time, a lot of money to reach maximum sales potential versus going in these, you know, markets that are not very deep where you’re making, you know, $10,000 a month top line.

The nice thing about it is you don’t really have to worry about competitors if you find the right markets. It’s extremely easy to enter. You don’t have to spend that much time, that many resources, like achieving success with these products. It’s so easy to do that. And so I would much rather sell 10 products that do $10,000 a month than one product that’s doing 100 K a month, and the reason being, again, competition, ease of entry. A lot of the time going for these, you know, smaller products, it takes 30 days to reach maximum sales potential, or maybe 60 days to reach maximum sales potential and boom, you’re off to the next product. And you can just continue to iterate from there versus going after these $100,000 a month markets generally assuming that there is some degree of maturity around it. It’s going to take you quite a long time.

So I see plenty of people just going – you know, the biggest account that I know of these people that are going, you know, in these wide markets, or going wide versus deep is $30 million a year just in Amazon US. So these guys have a killer business, and they’re just going after all the, you know, low-hanging fruit opportunities. And I would highly suggest anyone jump into there that can or is looking to start sourcing in a different strategy or whatever. I think this is probably the fastest, simplest, you know, lowest headache opportunity to growing your business quickly.

CAMERON YODER:
I would even say – I would add to that a couple years back I think this looked a little bit different just because the market, the Amazon market as a whole, was pretty different where competition with the deeper markets was a little bit less than it is now. Not to say that going deep was better than going wide, but even now since competition is so fierce, especially in those deep markets, going wide is going to let you really look into those markets that people haven’t discovered yet and/or are definitely not as competitive as the deep ones.

CASEY GAUSS:
Yeah, completely agree. Awesome. So we will move on to the launch phase of your FBA journey. Tip number one, you know, I would still – we’ve been trying to, you know, kind of preach this so sorry if you’ve already heard this, but so many people still have not, and I think it is just a very, very simple hack to potentially dramatically increasing your sales. And what that is is you need to include both plural and singular forms of your words in your listings title. So in Amazon’s style guides or guidelines they say you don’t need to include both singular and plural forms. And they say that Amazon, you know, they already account for this in their algorithm, but it’s absolutely untrue. You know, just one quick anecdote. Someone is running a launch for grill gloves. I believe they had gloves in their title, but they were running a launch for a grill glove, and for a grill glove though, the key word that they’re targeting, they hit page 2 like top of page 2 for the launch and they were, you know, kind of disappointed that they didn’t hit page 1. But if you went and looked for the plural form, grill gloves, they were like in the top 10 on page 1 even though they weren’t targeting that word just because it was in the title. And so basically that just goes – and we see this all the time. So this just goes to show that, you know, Amazon does treat singular and plural forms of words differently. I mean if you want to go prove it or test it out for yourself literally search grill glove. Search grill gloves. There’s going to be different search results or in different orders. If there’s not, go try other words, fish oil, fish oils. Just go try a few singular and plural forms of the same word and you’ll see different order of words, different results, and the title has a lot to do with this. So it’s a very quick fix. But like, you know, seriously, the difference in ranking or the amount of keyword power that you’re driving to one word could be the difference of thousands of dollars, tens of thousands of dollars in revenue every month.

CAMERON YODER:
That’s an easy action step, too.

CASEY GAUSS:
So easy.

CAMERON YODER:
To simply go over, go over listing and see if you have both plural and singular forms of your main keywords.

CASEY GAUSS:
Yep, and then the second part to that tip is just don’t repeat words. So you know, let’s say this grill glove seller, they have grill glove then grill gloves and barbecue grill gloves in their title. You don’t need to repeat all those words. It should be in phrase order. So ideally as much as possible, right, so it would be something like, you know, grill gloves, best glove for grilling, or you know something like that. That was just off the top of my head, so probably wasn’t the best. But anyways, you kind of get the gist there. But anyways yeah, you have to have – even if it doesn’t make 100% sense, you know, let’s say you’re selling one glove. You should still have “gloves” in your title because people are searching gloves. Or let’s take a grill brush for example. People are inevitably searching grill brushes, right? Even though you’re only selling one brush you have to have the plural form because people are searching brushes, and by having that in your title when sales are driven through your listing you’re driving that much more power to the ranking for that plural form.

CAMERON YODER:
And by not you’re missing out on all that opportunity.

CASEY GAUSS:
Right. And competitors are. And then second tip for the launch phase is just being aggressive. We just see so many people kind of, you know, tiptoeing to success or waiting kind of for the success to come to them, and it’s just less and less likely every day as competition continues to increase. You really have to go after that success, and I mean really looking at opportunity costs. If you are taking six months to get a product up and, you know, hitting maximum sales potential you’re missing out on so much opportunity. If you did that and if you were more aggressive, hit maximum sales potential in three months you would have twice as much time to go after that second opportunity. And so now you have, you know, let’s say you repeat that with a second product, and so then within six months you have two products at maximum sales potential versus the one. So by going slow, yes it is probably more cost-effective or more cost-efficient, right? So you don’t spend as much money going and achieving that success, but by spending that money and being aggressive you have the opportunity to make that much more money.

CAMERON YODER:
We’re getting into the New Year now, and we’re going to touch more on New Year tactics later. But really this aggressiveness, this tip to be aggressive is a great one to hold onto moving into 2018, even to now, and understand it’s getting close to the end of 2017 and everyone’s going to be spending time with their family and the holidays and whatnot. But planning ahead for 2018, to actually sit down and plan how you’re going to be aggressive is honestly a great strategy, just to even plan it out and see what it looks like for you specifically. Again, reevaluating your goals and setting new goals to just flat out be aggressive among other things. But Casey, let’s move on to dominate. What have you got?

CASEY GAUSS:
Yeah, so three tips under dominate. First one, just reinvest your Q4 profits. I mean hopefully Q4 has been, you know, an amazing experience for you. Hopefully you broke some records and are just super, you know, proud of yourself and excited for what you’ve been able to accomplish. But you know, at least for my personality and if you, again, really look at the opportunity that still exists in the market, I think you really owe it to yourself and, you know, all the people that you are planning on helping with what you’re achieving here with your Amazon FBA business to just go super hard and reinvest those profits. You know, delay getting that Lamborghini or going on, you know, these month-long vacations. You still have so much opportunity. The last thing you want to do when you look back five years from now, 10 years from now is say dang, you know, that was a gold rush and I went to the Bahamas for a month while everybody else is panning for gold and hitting all these opportunities and, you know, I missed out. So anyways, reinvest your Q4 profits. The amount of success that we are seeing on Amazon is just insane, even to this day, and I just really want to encourage you to continue to take part in it. Delay the, you know, instant gratification, the short-term gratification for the long-term goals. So yeah, just reinvest your Q4 profits. Kind of a little reminder there.

Tip number two is go international. So we are planning on having some guys on the podcast that I met recently, and these guys did – in their first year of Amazon they did $10 million.

CAMERON YODER:
They’re killing it.

CASEY GAUSS:
And some other fun facts for you is one of them, still in school full time, and they are both 20 years old. And the other fun fact for you is that they have never sold anything in Amazon US, only international. There is so much opportunity internationally. You know, these guys, you know, they’ll share their story and everything, but there is just so much opportunity internationally. The competition is a fraction of what it is in Amazon US, and I really think that you need to take your resources, you know, hire someone, bring someone on your team to be general manager of internationalization or marketplace director. I don’t know, somebody to go manage your international business.

But there is so much opportunity, and you really want to get in on the ground floor. I mean a lot of the like really successful folks in Amazon US that I know are all people that jumped in in 2014 or maybe 2015, and they went super hard when Amazon was so much easier. And now that Amazon has, you know, really dramatically increased competition and there’s so many additional sellers here, a lot more money going into driving success, it’s so much more difficult. But if you go look in the international markets, in the majority of these markets it’s Amazon 2014 still. And so you need to get in on the ground floor when, you know, Amazon is still – you need to ride that wave of success. So you know you’re on the ground floor. Revenue or revenue potential is just going to continue to increase internationally, but so will competition. And if you’re in, you know, on the ground floor you already will be ranking. You’ll already have the review quantity, and you can just ride that wave up.

CAMERON YODER:
It’s going to be – granted, it’s going to be a little bit different. I don’t think you should go into international markets expecting the same exact process as the United States, but these guys that we’re going to bring on later are examples that, guys, there are no excuses. At 20 years old they are killing it. They’re making bank, and they haven’t sold a single thing in the United States. So if that’s not proof as to what can be possible in international markets, then I don’t know what is. But that, I think that should be part of your long-term strategy, planning, right, to sit down and if international is something you’re interested in, find out more about it, do your research, and then dive in. All right, Casey, what’s tip number three?

CASEY GAUSS:
Tip number three, so basically just never go out of inventory. We see so many people make this mistake, and you know, sometimes it’s inevitable. Sometimes your projections are way off, which is a good thing hopefully. But anyways, there can just be a lot of, you know, downside to going out of inventory. So essentially, you know, just make sure that you are planning accordingly. You know, look at something like market intelligence where you’re able to see kind of the market trends and understand to what degree sales are increasing, decreasing and, you know, how long the increase or decrease will sustain just so you have a really accurate, you know, indication of what to expect or how the market will perform over the, you know, coming X number of months that you need to plan inventory for. And then secondly, like so it may be too late, or it’s probably pretty close to too late if it’s not already.

CAMERON YODER:
Honestly, actually yeah, by the time this podcast is out it’s probably going to be too late depending on the production time for your product.

CASEY GAUSS:
Yeah, I mean so the Chinese New Year is coming up, and I think it’s like early February to early March. Factories are closed down for a month, and before and after that, you know, it’s like, it’s just crazy production because they’re trying to fit everything in before and after for all the people that missed out. And so hopefully you’ve already ordered your inventory in preparation for Chinese New Year, especially if you’re wanting to launch new products. If not, like that can delay your time to getting that product up and running, you know, so far. But yeah.

CAMERON YODER:
This – it’s Friday, December 22nd, and I do know that a lot of manufacturers are taking orders this week in order to get products to you before the Chinese New Year. But with this area specifically, talking about inventory, guys, I honestly think it’s much better to play safe than sorry with this. And so it’s better to overcompensate for inventory here. And sure, you’re going to spend maybe a little bit more money, and you need to figure out how much money you have to play around with ordering inventory and different strategies with that. But it’s better to order a little bit more inventory than it is to run out of inventory and have to wait maybe a week to two weeks before you get your next shipment in. So plan ahead. Plan accordingly. Play it a little safe on this one.

CASEY GAUSS:
I think that’s pretty much all for me.

CAMERON YODER:
Yeah, well okay. That’s all for this week. Thank you guys so much for joining us here on Follow the Data. For more FBA tips and reliable information that will help take your Amazon business to the next level, subscribe to the podcast and check out the Viral Launch blog at viral-launch.com.

CASEY GAUSS:
Guys, we’re all Amazon sellers. We know the most difficult part of your Amazon business is getting reviews.

CAMERON YODER:
So hard.

CASEY GAUSS:
So hard. Please help us get reviews. If we could we would go review your product, but we don’t want to get you shut down. But by you reviewing this podcast we will not get shut down, so we would love your help on this. I mean really at the end of the day if you know anything about me or the company, like we just love honest feedback. So whether it’s in a review or whatever, any feedback just so we know how are we doing, what do you guys want to hear, you know, maybe our approach isn’t the best. Maybe you want us to use voice changers because you don’t like our voice, I don’t know. Anyways, we just love feedback. So yeah, thank you so much.

CAMERON YODER:
We’re also doing – we’re currently doing weekly webinars where we’re going through, walking through product discovery and different strategies that you can use to take advantage of the tools. So if you haven’t seen those yet keep an eye out for those. We do it every – typically every Thursday. But again, we just wanted to say thank you so much for listening. Happy holidays. We hope everyone has a great New Year. And don’t forget if you want to be featured on the show, or if you have an Amazon-related question or an idea for an episode you can leave us a voicemail. Our number is 317-721-6590. Until next time, remember the data is out there.

The ROI Metric: Identify the Best Products to Sell on Amazon

“The ROI Metric: Identify the Best Products to Sell on Amazon” is an excerpt from Viral Launch’s Ultimate Guide to Sourcing Private Label Gold Mines ebook. Download the full ebook at the bottom of this post.

The Key Metric to ROI: ROI Ratio

Finding the best products to sell on Amazon includes identifying and sourcing high ROI product markets.

Generally, the largest barrier to achieving sales potential in a given market is relative review quantity. We have overwhelming data showing us the relation of organic sales to relative review quantity. For example, let’s say that the majority of listings on page 1 for search “xyz” have over 1,000 reviews, but one listing has only 130 reviews. Relative to the rest of the listings, 130 reviews is quite few.  

Based on what we have observed, the product with 130 reviews will struggle to sell at a similar volume compared to it’s competitors with ample social proof at 1,000+ reviews. Review quantity is a major determinant considering all else is approximately equal (price, review rating, etc.). There are certainly exceptions, but this seems to essentially be the rule. This has been observed nearly daily in our experience helping newer products achieve keyword ranking among more mature listings.

While there are certainly ways to supplement a high review quantity to drive a relatively high volume of sales with other forms of social proof (ex. Best Seller badge, Amazon’s Choice badge, superior aesthetics, etc.), reviews are generally the product market’s “economic moat”. Overcoming competitors’ economic moat (reviews), is a function of time multiplied by your review rate. The faster you are able to achieve reviews, the quicker you will be able to overcome that competitive moat. This translates to: as a product achieves a relatively similar review quantity to its competitors, organic sales volume will increase.

For this reason, we identify the market’s comparative review threshold to be the amount of “investment” necessary to reach a market’s sales potential.

 

ROI Ratio = Monthly Sales Potential ÷ Review Quantity

Example of high ROI Ratio: 1000 units/month / 100 reviews = ROI Ratio of 10!

Example of low/bad ROI Ratio: 1000 units/month / 1000 reviews = ROI Ratio of 1

We generally suggest looking for product markets where the average ratio is somewhere above 2-3, as these are typically some of the best products to sell on Amazon. Conversely, stay away from markets where that ratio is less than 1. The higher the ROI Ratio, the more likely it is a good market to get into (it is still important to analyze the rest of the market metrics).

 

An Example of Sales to Review Ratio (AKA the ROI Ratio)

Imagine the average top seller in a market was driving 1,000 sales per month with an average review quantity of 45. The sales to review ratio would be (1000 / 45 =) 22! That is incredible. Driving just 45 reviews is a very simple feat (depending on the product as some products naturally are harder to obtain reviews for). So the amount of investment, time and money spent achieving just 45 reviews, is very low considering the sales potential of ~1,000 sales per month. We would consider this a very favorable market to get into – a great product to sell on Amazon.

Conversely, here is an example of a product market where the ROI Ratio (sales/review ratio) is approximately 1 or less. The amount of investment (time and money) needed to obtain a competitive number of reviews (1,000) in order to reach the sales potential (~1,000 units/month) is far too high for our liking. There are obvious exceptions: maybe you have the money to bully your way to the top, perhaps you have a dramatically superior product (very RARELY is this a viable excuse), maybe you are okay with a low sales volume for this product as it’s a natural extension of your brand, among others.

 

The Psychology of Review Quantity

Here is a brief rundown of our assumptions into the customer psychology of this phenomenon. Review quantity stands as the most evident form of popularity to the consumer among the products shown in the search results (while Amazon provides BSR to provide an indicator of popularity, a simple survey of Amazon buyers will quickly reveal this is not a well known metric nor is it shown in the search results). Which product do you think has sold more units?

As consumers we want a “safe bet” when it comes to making a purchase. We want to be sure that whichever widget we purchase will completely satisfy our needs and will not break within an unreasonable time. Consumers also fall subject to the bandwagon effect in which they buy the item because it is “popular”, which in turn, increases its popularity. “Many others are purchasing/not purchasing this widget for a reason, so I will take the safe bet and follow suit.”

Download the Complete Guide

Did you enjoy discovering the key metric to identifying the best products to sell on Amazon? To get other golden nuggets on sourcing your next home run, download the Ultimate Guide to Sourcing Private Label Gold Mines.

Contents include:

  • Crucial concepts
  • Product data vs. market data
  • Interpreting and analyzing market data
  • The key metric to ROI
  • Plotting your course for success

And more…

Fill out the form below to receive the guide and start sourcing gold mines:

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The ROI Metric: Identify the Best Products to Sell on Amazon

Related:

Generate Amazon Product Ideas: 3 Creative Methods for Sellers

Understanding the Amazon Best Sellers Rank (BSR) – The Definitive Guide

Amazon Success Guide Step 1: Sourcing A Great Product At A Great Price

Let me first begin by saying just about every product available to sell on Amazon as a private label product is a GREAT product to source, so long as it fits into your business’s strategy, you have the resources, and it makes sense for you as an entrepreneur. So the difficult thing is not finding a product to source. Go to Amazon.com’s home page, and you’ll see plenty of sourceable widgets. The difficulty lies in finding a product to source that fits You and Your business.

In this article, it’s our goal to help you identify what makes a product great for you, so you can build the foundation for the level of success you are looking for!

 

Identifying What Private Label Success Looks Like To You

While we are largely going to try to help you identify how to choose products that fit your ideal success model, we are also going to be challenging your definition of success. We’ve seen many many sellers succeed, and unfortunately our fair share of sellers fail despite our efforts. With the experience and data we have, we’d like to help you avoid the pitfalls we’ve seen others make.

So what does success look like to you in the private label world? Are you looking to hit a couple of home runs with some high volume products that profit you $10,000+ per month each? Are you looking to source a variety of low volume products that when added up bring in a hefty profit each month?

This is a decision you will have to make for yourself. If you expect to profit $5,000/month on a single product, but get into a product market where the average sales price is $10 and the average sales volume among the top sellers is around 500 units per month, you will be severely disappointed. If you are looking to source 5 products that add up to a monthly profit of $5,000/month, then this very well may be a good choice. See how expectations and how you define success matters?

Obviously we would all like 100 products that profit us $20,000 per month, but so does everyone else, which means you are going to be competing with a ton of other sellers. So in order to appropriately define your definition of success, you also need to understand how plausible your ambitions are given your current resources both financially and time-wise. Do you have a big team? Do you have thousands, tens of thousands, hundreds of thousands, a million+ to invest in your Amazon business?

Questions To Ask Yourself In Determining What A Successful Product Should Look Like

How Much Money Do I Want To Invest?

Do you have thousands, tens of thousands, hundreds of thousands, a million+ to invest in your Amazon business? The amount of money you have to invest will determine how much inventory you can afford. This may influence the products you select based on their per unit cost. This also has an impact on how large of team you can build initially (if necessary). The quantity of inventory you are able to purchase also has an effect on the amount of promotional units you will be able to give, having major implications on your ranking strategy. 

How Large Is My Team? How Large Of A Team Do I Want To Build If Necessary?

Some sellers prefer to not grow any larger than themselves and a couple of VAs they hire hourly. Other sellers are willing and ready to build a massive infrastructure of warehouses and employees. Obviously this is not a question if you are just getting into the business, but for some later stage sellers this may be a barrier to growth if growing a large team is outside of your comfort zone.

What Kind Of Profit Margin Am I Looking For Per Product And Collectively?

Are you wanting to go deep on a few high volume products? Are you looking to go wide meaning going after a larger variety of low to mid volume products? There are pros and cons to each, and we’ll outline those down below!

In total are you just wanting to add a few thousand dollars to your bank account each month or are you looking to build a mammoth $1,000,000/month Amazon business?

How Many Products Am I Looking To Sell In the Next 3-6 Months?

For sellers just getting started, again, this is not a question you can answer accurately right now. It is also highly dependent on your capital. Some sellers are okay launching just a couple of products and reaping the benefits each month. They don’t want the added stress and pressure of continuously launching product after product. Keep in mind the amount of profit you are looking to make total. Going after a couple of products that may add $1,000 of net profit will not get you to your total goal of $5,000 if you are only wanting to sell two products in the next 3-6 months.

What Is My End Goal With This Business?

Is this going to be a lifestyle business for you or are you looking to maximize sales to shoot for an acquisition?

This may or may not have an effect on how you choose your products. For example, from our experience with Amazon business acquisitions in the private label world, companies are looking for strong brands. So selecting products that will allow you to build a cohesive brand will be important. With that said, Amazon businesses that are purchased solely for cashflow purposes do not typically put emphasis on having a unified brand(s). Either way, it is an important consideration in how you will position yourself for acquisition if that is your goal.

How Things Will Change With the New Amazon TOS Update

Post TOS update, from our perspective, sellers must be more precise in selecting a “good” product because the playing field has been leveled. Pre-update, it was very easy to give away a large amount of product in exchange for reviews. Doing so generated a competitive number of reviews and built a sales history that got that product ranking for each and every keyword that the seller selected.

So if you had a super competitive product, you were okay so long as you had the money to run enough promotional sales.

Post-TOS update, generating a competitive number of reviews becomes much more difficult. Generating reviews today rests solely on having a killer product that customers want to review and leveraging a killer email follow-up sequence to ask your customers to actually leave a review.

So how will this affect your decision making in selecting products to source?

You need to be drastically more concerned with the number of reviews page one and two competitors have. While there is some misinformation in the space around a “magic number of reviews” needed to generate organic sales, our data shows us that the key to selling well organically is having a “competitive” number of reviews relative to those listings you find yourself around.

What that means is, if the page one sellers have reviews that look like this RUN FAR AWAY!

 

 

 

Here is a screenshot from the same keyword, “vitamin c serum” that shows how important having a competitive number of reviews is. The listing ranked 6th has 10,000 reviews and is selling 3,000+ units per month. The next guy, although ranking really well for a very high level keyword, is only seeing 270 sales per month. At the 8th position they have a decent number of reviews, especially compared to the the 7th and 9th position, so they are seeing a moderate volume of sales. At position 9 the seller is hardly seeing any sales at all because they have 0 reviews! While there are multiple factors that come into play when a customer decides which product to ultimately buy, reviews and price typically have the most substantial effect.

 

Are Home Runs Dead?

The short answer is no. Not at all. If you have already been working on a home run type product (home run = high volume product), then definitely don’t give up. Depending on where you are at in the product launch cycle, you may need to adjust your strategy, but don’t worry, success is still a very attainable goal.

If you are just getting started with a home run and it is your first product on Amazon, beware. It is likely to be a long and costly battle depending on what the market looks like. It can be best to get started with a relatively simple product to understand the market, the processes, and the expected results.

Our suggestion for new sellers is to get into markets where a “competitive” number of reviews is below 500. Ideally you could find a product where page one sellers ranking between #3 – #12 have a sales volume of 500-1000 units/month and have around ~250-500 reviews. These products are much easier to break into the market with and allow you to learn a lot of the ins and outs of selling on Amazon without investing too much money.

 

Keys To Sourcing Great Products Regardless of The Amazon TOS Update

  • Find a quality product!
    • Reviews are king on Amazon! If you have a poor quality product you are going to find yourself with a product that continues to generate poor reviews. Before too long you end with a product noone wants to buy. There is nothing worse than having thousands of dollars in unsellable inventory.
    • Quality products can result in the sales boosting effects of word of mouth, positive reviews, and repeat customers (depending on the product of course).
  • Find a product at a great price!
    • If you are sourcing your product at a 25% higher cost than your competitor(s) for the same exact product, they will always be able to beat you on price. You can quickly lose to the competition on listing price, promotion capabilities, etc.
    • Product sourcing Guru Alan Basinger has a quote that I love! He says, “You have to win on the buy!” It is spot on. Alan has a logistics company that helps bring products into the US as well as sourcing directly from manufacturers in China.
    • Go to China directly! The Viral Launch CEO recently went to Yiwu with a group called SourceInAsia as a mentor and saw just how powerful working with manufacturers directly can be to negotiating quality product at a great price.
  • Find a product with great margin!
    • Margin is a huge consideration for product price. Make sure there is a great margin between the price at which you source and the price at which you sell is key! If you’re not making much money per item what is the point in selling? The other fear is if the market decides to start competing on price you want to make sure you are not priced out. We’ve seen this happen all too frequently over the last couple of months.
  • Watch Out For Name Brands
    • We’ve seen a couple of sellers get into products that are largely dominated by name brands. This is common in baby/children’s products. For example, sourcing crayons as a private label product can be insanely difficult because the first couple of pages are almost completely dominated by Crayola. Good luck competing with them.
    • Also be weary of sourcing a product where the main keyword(s) is also a brand’s name. Ex. “Yeti Mug”. It can be very difficult to outrank a brand if the main keyword is the search term. Amazon attributes a LOT of rank power to the brand’s name.
  • Consider product size, weight and durability!
    • Knowing how the size and weight of a product will affect shipping is crucial to estimating margin and expense. Work with your sourcing agent or manufacturer to understand the costs associated with shipping your product into the country, to your warehouse, and/or FBA.
    • You will also need to know what Amazon’s FBA fees associated with shipping will be. For that you can use Amazon’s FBA Revenue Calculator which will give you a good idea (don’t bank on the accuracy of the fees).
    • Durability is key to providing a good customer experience and avoiding customer returns. You may want to avoid easily damaged items.
  • Long-Term Brand Building Or Revenue Generation
    • Are you looking to build a long lasting brand or just looking to solely focus on increasing revenue (not that building a brand won’t help you generate revenue)? If you are looking to build a brand, make sure to choose products that will allow you to easily add products that make sense such as a yoga mat, and some yoga massage balls. The added benefit here is you can take advantage of bundling and upselling. It also saves you time and money by allowing you to pay to have one brand created (logos, label/package archetypes, etc.).
    • If you are looking to simply grow revenue you can be very selective in the products you decide to source. Meaning, if the numbers make sense, source it. Sellers who take this approach end up selling products as different as a eye cream and a pet bed.
    • Either approach is great so long as it aligns with your idea of success in running a private label business.
  • Make Sure Your Product Is Created With Customer Approved Materials
    • You don’t want to source a cream that is going to cause rashes.
    • If you say your product is organic/natural/paraben-free/etc. make sure that it is. If all of your competitors are able to make such claims, you will miss out if you cannot, but don’t lie to your customers. Trust me, they will find out if you are!

Tools To Use When Product Sourcing

Jungle Scout

The Viral Launch team uses the Jungle Scout Chrome plugin religiously when putting together launch strategies. This tool is great at allowing you to quickly analyze the most important stats of products that rank for a given search term without clicking into each listing (at least that’s how we use it). Jungle Scout also has the most accurate sales estimates overall I’ve seen.

When sourcing, Jungle Scout also allows you to easily compare how a style of product is selling better than others. For example, let’s say you are wanting to sell grill/cooking gloves (which I would advise against due to the amount of competition). You would want to know if you should invest in the type of gloves that have 5 fingers or the mittens that have one slot for your thumb and one for the rest of your fingers. Choosing incorrectly could have major implications.

We also use Jungle Scout to estimate the number of units we will need to give in promotions to achieve keyword ranking and to help give for reviews. With the TOS change these numbers will differ (which we will get into in a different section of this guide), but having an idea as to the number of units you will want to use for promotion are crucial to understanding the total costs associated with launching a product.

Greg at Jungle Scout has plenty of tutorials on how to effectively use the tool. We personally use the tool for a very limited scope of its total potential!

Project Sourcing Success (Name To Be Announced Later)

Viral Launch has seen too many sellers lose thousands of dollars by making bad sourcing decisions. By the end of October of this year we are planning on launching a new tool that will help you make more intelligent decisions around product sourcing. It will go wonderfully along with Jungle Scout or similar type tools.

If we can help our clients avoid bad sourcing decisions, we will gladly seize that opportunity!

 

Conclusion

It would take us many blog posts to effectively cover the entire ins and outs of product sourcing, and to be honest, we are not the best company to handle how to source end to end.

With that said, our extensive knowledge, data and experience in running over 11,000 product launches and working mega sellers doing 50-100 million a year in sales on Amazon, we do have plenty of beneficial tips and knowledge that can help you avoid some major pitfalls that can have serious repercussions.
At the end of the day, you need to make sure you are selecting products that appropriately align with your idea of success and your resources. What is a good product for the next guy may not be a good product for you.

 

If you have any questions, we will be happy to answer them in the comments! If you have any feedback, we would love to hear it as well!

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