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#96 Amazon Mindset Learnings from Musicians

Having just played piano for music auditions in London recently, it struck me that the Main mistakes made in auditions are the same as those made by many beginning Amazon entrepreneurs. mindset strengths or  mistakes and doing it well – needed for auditions for peak performers  are the same as those needed for Amazon

Mistake #1 Failure to prepare

Solution: Prepare!  It doesn’t take a rocket scientist to know that Xmas sales are big in retail. Plan your inventory accordingly. Plan your cash accordingly. If you’re just launching a Private label business, plan your capital needs upfront (hint: £1000 isn’t enough for private label! Don’t believe the hype – it’s designed to sell courses, not make you money!)

Mistake #2 Getting put off by mistakes

Solution: When you have a basically sound plan  – keep going! Mistakes are not reasons to lose focus or momentum. Or rather, they can be  – but don’t let them! Stay focussed and learn fast!

Mistake #3 Expecting to be great first time out

Solution: Practise! The best way to do a great audition is to do several – some good, some bad, some mediocre – and to learn from the experiences. The best way to do pick an Amazon product or do an Amazon launch is the same. Plan accordingly (don’t put all your money into one product, for example), start manageably and scale up with experience.

A great bit of advice is to start with Retail Arbitrage (retail arb or RA) or Online Arbitrage (OA). I haven’t done it this way so I can’t guide you properly, but if you are US based, Jim Cockrum is your man. Check out his site My Silent Team.

Mistake #4 Not getting training (or just learning from Podcasts and Facebook group aka “Drinking from a firehose!”)

Solution: Get the best training you can afford. Yes, podcasts and Facebook groups are free and an excellent place to gather info. But it’s too much to absorb and nobody can really structure it to be step by step in those formats.

I would get training from someone who knows what they are doing, preferably geared to your particular finances, circumstances and experience.

Above all, I would get myself a group of peers who you can grow with (find out more about the Amazing FBA London mastermind- on waiting list only at the moment). For me personally, this has been the single biggest success factor so far, hands down.

#92 What are your Amazon Business Daily Rituals?

When you work on your own, it can be easy to fall into bad habits and drift or even go backwards.

Ideally, one key thing is to be sure you aren’t on your own too much – you need to connect to fellow entrepreneurs. Join a Facebook Group, get a mentor and or join a Mastermind group.

But there are inevitably weeks and days at a time when you’ll need to get and keep yourself going.

For me, that is simply taking a walk first thing in the morning and making phone calls to fellow entrepreneurs (nowadays I also often make a call to my business partner).

What are your rituals? Let me know in the comments below.

This episode is one of the **Summer Series** of bite-sized chunks of Amazon Strategic Goodness!

#87 The Amazon Reviewer’s Perspective with Augustas Kligys – Part 2

Can you tell us about any products that you get asked to review that are over-saturated and there are too many of them out there?

It can depend on the season. For example, during the summer he was getting a lot of review requests for money pouches and passport holders that you would use when you travel. As we get closer to Christmas he will likely start getting a lot of requests for lights and other holiday items. Keep this in mind if you have seasonal items.

For instance, let’s say you are going to sell neck pouches for traveling. You know the summer is going to be the busy time for travel so you want to plan ahead and start getting reviews in spring or even winter. You want to get ahead of the competition.

If you wait until June, the reviews will have received several requests for similar items and may not want any more. Also, reviews may take a couple weeks for the reviewer to get around to it. If you wait until June, it might be in July when the review comes in. At that point, you have already missed a good portion of the traveling season. As a bonus, if you get your reviews early, you are prepared for customers to start looking to buy these items. Click here for more information on the European summit if you are looking for tips on breaking into the European market.

Other items he gets requested a lot include flashlights, bike lights, headphones (bluetooth and wired), LED lamps, garden lamps, solar/ battery powered lamps.

Amazon has banned the use of super URLs, have you had any issue with this?

(A super URL is the address Amazon uses when you search for items and listings get ranked higher based on the keywords people search for. There are tools that will mimic this super URL and makes Amazon think people are finding your product based on keywords that they didn’t search for and thus these products get listed higher.)

Augustas hasn’t seen much of this lately. It used to be that the requests would give instructions directing you to go to amazon.de/keyword and it will be the third item down. This would build your ranking for that keyword but it was very inconvenient for the reviewer and often Augustas would ignore the instructions and simply locate it by the ASIN. He doesn’t get these much anymore and there is even a service that will mimic that URL so you don’t need to go through all that. However, be warned that Amazon is cracking down on the tactic and has even started removing listings.

A tip from Augustas for sellers that do fulfilled by merchant rather than FBA. If you have a good relationship with a reviewer, you can use them to make sure your staff or external warehouse is doing a good job. Augustas had a seller that had his own shop and staff that packaged everything. Augustas would give him feedback on the packaging and ways to improve it or if something was missing. It’s a good way to test for quality assurance. It’s better to get private feedback from a reviewer rather than a very public negative comment from a customer.

How important do you think reviews are in general for listing conversion?

Some people may not believe a review is genuine. As a reviewer, it might be difficult to leave a bad review if you have a good relationship with the seller. So rather than giving a 4-star review, you may give 5 because of the customer service.

As a customer, Augustas will always compare reviews especially if one doesn’t seem genuine. And if he sees a short review from a customer that hasn’t left many other reviews, it will hold more weight because it’s a casual shopper that wanted to leave their experience rather than a top reviewer. He noticed on one particular item that he was giving 2 or three stars and the reason why, and he saw the rest of the reviews were all 5-star reviews from top reviewers because they were getting free stuff.

Do you think, as a shopper, that the quantity of reviews is important for conversion? Or is quality more important?

Augustas will look for 2 or 3 quality reviews. If it’s just 2 or 3 lines he will often skip it and look for someone that wrote a couple paragraphs. If he sees that the person got the product for free in exchange for a review then he will look for another one and compare. But definitely, he wants to see a few quality reviews.

Augustas was looking at another product some time back and noticed they were getting close to 50 reviews a day. However, they are said they got the product for free. This went on for a while, around 50 reviews a day and they had around 1000. About 6 months later he went back looked and found that they almost completely stopped getting reviews. They might have gotten another 50 organic reviews which showed that they might not be getting many sales. They invested a lot to get all those reviews but that didn’t translate into actual sales because they weren’t quality reviews.

As a buyer, how important is the quantity? Are you looking for 100 reviews or are you happy with 5 as long as they are long quality reviews?

A few good reviews are great. If he can get a good idea about the product from a few well-written reviews then it doesn’t matter if there are 50 more reviews.

For more info on the European Private Label Summit, click here where you can learn other tips for succeeding in the European Amazon marketplaces.

What about photos and videos? Do you think they make a big difference to the impact of a review?

Oh yes. Since sellers cannot upload their own videos they really like it when the reviewer does one. Some sellers have approached Augustas about reviewing their products because they saw the videos he did.

Now Augustas will upload about 10 photos and a video for each review he does, and as a buyer, it holds more weight than what the seller uploads because it is an actual customer’s unboxing rather that the photoshopped images the seller is putting out. Depending on the product, in his video, he will show how the product is used. This could be particularly beneficial if it can be complicated. This way buyers can watch how it’s done rather than be dissatisfied with your product.

Does it make a difference to Amazon if you have a lot of top-reviewer reviews?

Probably not. It’s unlikely that Amazon would weigh top reviews more than regular reviewers. In fact, Amazon doesn’t really like these free reviews. He did an interview with a private seller that used to work in Amazon and according to him Amazon is all about the customers, and when reviews are getting free products then they are losing the true connection between the product and the customer. It may be, that in the future, it will be more difficult for this type of reviewer to exist.

Even as sellers, we know that these reviews aren’t completely genuine. It’s different than when as a customer, you buy a product, you really like it, and decide to go and leave a review. It’s likely that Amazon will make it more difficult and in fact, in the US, they are starting to require that sellers can only give a 50% discount for reviews.

Tell us about the private label online summit

Augustas wanted to start his own private label business but it ended up not working out and he got into reviews. He noticed that people often had a lot of questions about Europe and there wasn’t one place you could go for consolidated information about getting reviews in Europe, different languages, taxes, and many other topics. Augustas decided to help out by gathering experts about all these different topics. He has about 20 speakers that will be sharing their knowledge. He has some sellers from the US so you can hear their stories and follow their paths. There is a lawyer from Germany that will discuss some of the laws and regulations you have to follow, especially in Germany where they are a bit stricter.

He decided to go with a virtual format because it’s easier to set it up, it easier for the speakers to be there, and it’s easier for the audience to be able to get all the information.

If you have had any desire to sell in Germany, this is a great resource to learn what you need to know. If you’re a UK based seller, you can still be based out of the UK and sell in Germany. Your orders will be fulfilled by the UK warehouse. If you are in the US, don’t let the language barrier stop you, it’s not that difficult to work around.

Click here for more information on the European Summit

Do you have any websites/events/places that people can learn more from you or contact you?

agustaskligys.com

European Private Label Summit

Any parting words of wisdom?

Treat you reviewers like your customers. Forget you are giving them something for free and treat them with respect. You will get more and better feedback from them.

#86 The Amazon Reviewer’s Perspective with Augustas Kligys – Part 1

Augustas’s Background

Augustas is originally from Lithuania and moved to Germany because that is where his wife is from. He has moved around a lot and is quite the digital nomad.

For access to the European Summit with special bonuses for Amazing FBA listeners, click here.

About a year ago he learned that he could get free stuff from Amazon sellers after looking into doing FBA. He never started his Amazon business, instead he got into doing reviews. He found Facebook groups for German products and decided to give it a shot. He saw one seller looking offering a hands-free bluetooth device for cars and applied for it and got it. After that he started looking for other items that he needed around the house. He began to realize how much value he was giving to the sellers after they began messaging him, thanking him for his reviews and asking him if he wanted to review another product for him. He is a top 400 reviewer in Germany, currently 320 and organizer of the European Private Label Summit!

For access to the summit, with special bonuses for Amazing FBA listeners, click here

Has it changed now that you’re more established?

Since Augustas is a top 400 reviewer, he is able to make his email public and sellers can contact him for reviews. Whereas before he would have to hunt for products to review. When he first got started he didn’t have any reviews in his profile so sellers weren’t as interested in working with him. He would started leaving reviews for any product he bought so that he could start building his profile. He would hunt for any product he could review and as he ranked higher and higher he began receiving emails to review products. Now, on average, he gets about 8 emails a day.

What kind of products turn you off?
What are the best kinds of products that attract you to review them?

Each reviewer has different things they look for. Some will end up selling the item on eBay whereas Augustas will see if he needs it around the house or if he can give them as presents. Though if it’s an expensive item, he might consider reviewing it even though he doesn’t need it with the intention of selling it.

Another thing to consider is the price. Since Augustas puts so much effort into his reviews, he reserves an hour for each one. If it’s a less expensive product, maybe €10, he is more likely to just buy the product outright. If you have a lower priced item, you might get better results from looking in reviewer clubs and Facebook pages rather than the top reviewers. However, some top reviewers will do lower priced items, so it’s always a good idea to check out their reviews to get an idea of how the operate.

What are the big turn-offs in emails?

Augustas prefers emails with direct links to the products. Also, make sure they are short. Sometimes the URL is very long and goes for several lines in the email which could get cut off or mishandled by the software. So use a shortening service if you need to. Add a picture of the product so he doesn’t have to go to the URL to see what it is.

Some sellers write longs emails talking about how they saw he was a top seller and how they saw his reviews and going on and on. Leave that off. For Augustas, receiving as many emails as he does, doesn’t read them. He will quickly scan the email, mainly looking for the link. Don’t waste your time and his by writing long emails. Make it short and sweet and have your listing make the sell to him. This goes back to making sure you have a strong listing.

What is the best email approach that you respond to?

For Augustas, it really comes down to the link. He doesn’t really read the email. Since some of the information he needs get lost in the text, he might miss it.

What he is looking for is:

  1. Title of the products
  2. A shortened link directly to the products
  3. A picture
  4. The discount information and coupon code

If you are contacting a reviewer in another country, add a sentence at the bottom of the email apologizing for you poor language skills and note that you are a native speaker. It might not always be useful, but it is for someone like Augustas. He is not a fluent German speaker who writes reviews for the German market. For him it is easier to communicate in English. So by adding the note in the email, he will know that he can contact you in English instead of both of you struggling in attempting to communicate in German, which neither party is fluent. You are more likely to find people that can speak English rather well.

Are there particular review clubs/services that you like as a reviewer?

When Augustas started out, there weren’t any well-established review clubs in Germany so he joined a Facebook group. Then one-by-one the clubs began popping up and he started joining them. The one he likes is amzreviews.co.uk or amzreviewtrader.com in the US. It’s a global platform and you can choose your market. It has a great search feature, big pictures, and it lists how much it will cost. You can apply to be a reviewer and if the seller approves you, you will get an email. Then you go back to the platform and get the coupon code, order the products, and submit the review link.

The problem with this platform is there are thousands of products, so if you know what you want it’s easy to find. However, there is a good chance that you are missing out on some great products.

What about red flags/warning signs?

The only thing Augustas really warns against is spam email. Sometimes you can get that with some of these review clubs since you are putting your email out there. Just make sure you protect yourself.

On a sidenote, Augustas made sure it was known that you need to treat the reviewers like customers. Listen to their feedback. Augustas mentioned that he was dealing with a seller who sent a product without the necessary adapter to make it work and expect him to solve the issue. On the reverse side, he was reviewing a tote bag that had a hole in it when it arrived and within hours the seller had gotten back to him and shipped a new one. As a seller, do not treat your reviewers like the first example. These people are putting a lot of effort into reviewing your product so please respect their time. Also, you run the risk getting a negative review from them.

How do you deal with Amazon ToS? Have you ever had a review removed because you got it for free?

Augustas has over 200 reviews and has never had an issue with one getting removed or any seller coming to him after the fact about a review. Augustas uses ARAT software to monitor his reviews and those of other top sellers and hasn’t noticed any issues with his reviews.

Sometimes the reviews get stuck in Amazon’s system. In the US and UK, reviews will be published within 6 hours, in Germany it’s a bit longer. So if he notices his reviews haven’t been published he has to contact Amazon or else they will never be published. He also noticed that some of his reviews weren’t listed as verified purchase. He mostly saw this when he ordered from the UK market rather than the German. But after the market was released, it showed up as verified.

Keep that in mind when working with the reviewers. Make sure to approach them respectfully if it appears they haven’t left a review because it would be a glitch in Amazon’s system. SO if they say they left a review but you don’t see it, ask them to contact Amazon directly because they may be a reason the reviews got stuck. For example, Augustas had a review get stuck because two of the pictures were too dark. Another got stuck because he showed the website address in his video.

For access to the European Summit with special bonuses for Amazing FBA listeners, click here.

#79 How to prep for Amazon UK with Greg Jones – Part 1

Greg has sold on Amazon for about 2 ½ years now so he has quite a bit of experience with selling. Greg saw an opportunity while he was selling. He hated doing the prep work. It took a lot of time and kept him away from what actually made him money, sourcing and working with suppliers. So he started FBA Prep UK almost two years ago as a solution for Amazon sellers.

Why bother with prep at all? Why not just send directly from China or supplier to Amazon?

First of all, things happen to products. It’s more common with air, there’s a lot more handling and a lot more opportunity for packaging to be damaged. From the supplier not doing what their supposed to, then sending it to the plane, loading and unloading from the plane, then to the Amazon warehouse.

Sometimes the products show up without packaging. It may have been repackaged by the shipping company because it was in such bad shape. Amazon won’t accept that. They have very high standards for what they expect and if it arrives damaged, they will not accept it. It will either be removed or destroyed.

To avoid all this, you’ll want the products to be inspected before they go to the warehouse. You can do this yourself but you will soon realize how much time and effort it takes to go through everything.

So what prep do you need to do for Amazon?

Obviously, everything will have to have a scan-able barcode, i.e. EAN or UPC work fine. Most products that come from China do so in a poly-bad or a plain white box with no identification on it. Amazon cannot accept that. They are a massive operation that cannot deviate from their processes. Prep companies, being smaller and working with you directly, have the flexibility to ensure the products are packaged correctly before Amazon gets them.

For the items that come in the poly-bag, can you repack those?

These bags are quite brittle and are too thin so they don’t meet Amazon standards. They have to be sealed or they have to have a suffocation warning label is the opening is more than 5 ½ inches. These aren’t Chinese regulations, so unless you specifiably request this, it won’t be done. Sometimes it won’t happen if you do specify it. Keep in mind that your supplier is likely not to comply with your instructions. There is very little chance of getting your money back should they mess up. Typically the only recourse is a discount on your next shipment.

If you hire an inspection company and everything checks out at the factory, what are some other things that can go wrong?

If it’s in a poly-bag, it’s pretty much ok. The problem starts if you have it in a box that gets thrown in to a shipping container. By sea is better because there is less handling. It doesn’t get handled much until it arrives gets put on a pallet.

Greg recommends contacting the supplier and having them ship extra boxes. Many times some of them will get hit by a forklift and the packaging gets messed up which will be rejected by Amazon. The products are fine but because the box is messed up it becomes unsaleable. If you don’t have extra boxes you have to contact the supplier after the fact. The supplier will likely not send you the extras until your next shipment which leaves you with 10-15% of your products sitting around until you’re ready to order again.

Greg’s standards are whether or not he would be happy to receive it. If he order an item off Amazon, would he be happy to receive it in that condition? If not, he would send it in until it gets repacked. This is also to protect you. Amazon shoppers are picky. They will rate a product low based on the packaging. Even if the product is great but the packaging was awful, they might leave a poor review. So it’s worth it to wait to send it in rather than risk a poor review.

So if you bother with prep, why use a Prep company?

It depends on your circumstances. Whether or not you have the space and means of handling them. Make sure to receive the samples at home so you have a change to inspect them before making a large purchase.

Some people don’t realize how large their orders are. So when you try to prep 100 or 150 units, you realize that you don’t want to be doing that for 500 or 1000. 1000 units, you’re probably looking at a pallet. You have to make sure you have a place to put a pallet.

Greg had a customer call him one time about 2000 piece order that was about to dock and he was told that it was going to be two maybe three pallets. He hadn’t realize how large it was going to be and was planning on fitting it in his two-bedroom flat on the 16th floor. This would not have been remotely possible to do on his own. He had to have the help of a prep company that has the means to handle such an order.

Also, this is almost required for some sellers that do it as a side gig and they have full-time jobs and they do their sourcing and dealing with suppliers in the evening. They have no time to be messing with prep work because they have their full-time job. It’s not feasible for them to do it on their own.

What are the main steps you go through to prepare for Amazon?

  • Check cartons
  • Unpack & Check boxes
  • Inspect outer cartons and items themselves
  • FNSKU barcodes
  • Have a report/structured record
  • Inbound Shipping to Amazon

What are the biggest mistakes you’ve found sellers make with freight that you’ve come across?

The story before, about the guy that didn’t know what he was going to do when it arrived. There is a scam going around where the supplier offers you shipping terms. They offer FOB prices to the port in China and CIF prices Felixstowe.

To clarify some terms, FOB is “Freight on Board”. The Chinese will pay the expenses to get your goods from their factory to the port of departure. CIF, Carriage, insurance and freight, is the exact same thing to the UK ports. So they exported the products, put it on a boat, and it will arrive at the docks in Felixstowe or South Hampton. From dockside, you have to organize onward freight and customs clearance. In Greg’s experience he got the same price for FOB in China and the CIF in the UK. It got to the UK and it seemed like it was all a part of the service, but after talking to he Freight Forwarding partner he was told it was a scam.

When it gets to the UK, the handling agents have to pay the shipping charge. It’s not free, it just gets passed on the UK agents who then pass it on to you. You then, also have to pay your normal VAT import duties, and custom clearance duty fee. He has heard figures of £600-1000 just to release the product. If you don’t pay them, you don’t get your product. They then start charging you storage fees and the costs just start rising.

What are the warning signs to look out for?

The supplier will offer you terms that look remarkably good. “If it looks too good to be true, it probably is.” Ask for prices from other freight forwarders. Even if it just to give you an indication of what the cost might be and if the Chinese guys stack up and looks about the same, you should be fine. But if it’s considerably cheaper, then at least you know what prices you can expect.

What are some basic dos and don’ts of working with a prep company?

The biggest thing is trust. At the end of the day, you’re sending a large investment, thousands of pounds worth of product, to someone you don’t know. You don’t know if they exist. As an entity, they could just be a website and an email address and you end up sending your stuff to them. Make sure your happy with them, call them up, look for social proof. Just make sure you’re real.

Keep in mind they are an extension of you, they’re not the importer on record. They don’t have importing responsibilities, they are simply a delivery point for you. You need to tell your supplier that. Greg has gotten invoices coming in with his name on them. Then DHL, or whichever shipping company will send him an invoice for the duties. He will send that on to the customer, but the invoice is in his name. So that makes it difficult for the customer to put it in their accounts.

Even if you’re out of the country, they will be your delivery point. So it will be your name, your company, at their address. So the invoice will go to the prep company who will then forward it to you. If it’s been agreed, they will pay the duties.

Tell them it coming. As ridiculous as it sounds, inform them of it’s arrival. The worst thing for Greg is to receive six pallets of products and have no idea who it belongs to. All they have is his name on the invoice.

#68 Post Brexit thoughts for Amazon Sellers

Brexit has hit UK based entrepreneurs, like everyone else in the UK.

But I think it’s time to start reflecting quietly on what this means for your Amazon business. There will be threats and issues – but also opportunities.

First and foremost: Don’t panic. Don’t despair. Respond but don’t react! Assess everything with a cool business brain. Don’t be a Polyanna; don’t be pessimistic, either. Just be aware of events and stay aware of threats and opportunities. When you spot the latter, act decisively!

Threats & Solutions

The USD/Pound rate

  1. The pound now buys you about 15% less in USD (at time of writing) than before Brexit (about 1.30 USD).
    1. So now is not the time to start selling in pounds (UK) and buying in dollars from China (nor in fact in RMB, the Chinese currency, which has more or less tracked the dollar).
    2. If you are already selling in the USA, and are having funds paid into your UK account in pounds, set up a USD account in the UK Fast (I use Metrobank simply because it was so quick and easy to set up an account; others use HSBC with success) and set up a receiving account with a decent currency exchange (I use Currencies Direct, who are the most cost effective and quickest out of all solutions I’ve tried).
    3. If you already have dollars in reserve, I would be inclined to use them to get more dollars, ie sell in the USA.
    4. Having said all of which, always analyse each individual opportunity (market research) for profitability/cash needed. There will almost certainly be some amazing opportunities in the UK, just be very careful to analyse  the unit costs from China.

The USD/Euro exchange rate

1. For now, if you’re selling in Euros (if you have inventory in the UK or other European marketplaces) and are selling into  Germany, France, Spain, or Italy, again, get yourself a Euro account in the UK and set up Currencies Direct or similar to receive your payouts from Amazon. Euros are for now worth more than before Brexit.

2. However, I would say that medium term (who knows exactly but I guesstimate within 6-18 months or so), the Euro itself will be hit by crises and thus lose against the pound (worth less to you  if reconverted) and against the Dollar, which you need to pay Chinese suppliers (to an extent it has itself been hit by Brexit).

I almost guarantee a crisis, if nothing else, because of the Greek debt situation. I’m no expert but it’s pretty obvious that if they couldn’t pay their debts last two crises,   next time (when they will have expanded), they will simply have to be written off to a degree (in a “haircut”). The markets are going to hate this and they will punish the Euro.  It will probably bounce back, I suspect, but that is way harder to predict.

3. Of course, one way to mitigate Euro currency risk is to sell in wealthy Euro countries on Amazon (eg in Germany) AND buy in Euros from lower-cost countries (eg Estonia). This is something I’ve been exploring in depth but I’ve no practical experience yet.

Opportunities:

Simply put, tough times thin out the herd. We aren’t in a recession yet, but for people converting pounds to USD, their dollar costs just rose 15%. That may drive some people out of the whole business model.

If there is too much competition for your liking on Amazon UK, or from UK sellers on Amazon, this is one way that it will get reduced. It may indeed be the right decision for you and your business to shut up shop. Assess objectively if you can. But equally, if you can ride it out, you will have less competition at the end of the process.

If you sell and buy in dollars, you are effectively outside the UK economy and outside the pound’s relationship to other currencies. Congratulations! You still have to deal with the intense competition on Amazon.com but if you can handle that, there is money to be made.

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#59 Kevin King Part 3 of 3: Expanding your business and the future of Amazon

Kevin King part 3 of 3 show notes 

What’s working best in your business now?

Kevin encourages people to focus on Amazon. It is the biggest platform for online shopping and if you focus on maximizing on Amazon first, it will pay off. People are already there with their credit cards out wanting to buy. Since Amazon is always changing things, you need to keep tweaking your listings to keep up with the changes. You can’t just post your products, sit back, and watch the money roll in. It doesn’t work like that.

Once you maximize on Amazon, what do you do to expand off Amazon?

Kevin is working on getting into some big-box retailers as well has having his own Shopify site. Kevin has also found success using JoeLister. Using this tool is Amazon items are automatically submitted to eBay. Any sales from eBay are sent to Amazon for shipping and sends the customer the tracking number. It’s all automated. It does a relatively small amount of sales, roughly $1000-2000 a month. However, since it is all automated he doesn’t require any additional time and effort to get those sales. It’s free for the first couple listings and after that it’s only $29 a month.

He also has his own branded site to go along with his Shopify site to add legitimacy to his brand. That way if first-time buyers try to look him up they will see that his are valid products. However, these are just tools that support his Amazon business. Again, the main focus should be Amazon.

Another great tool is Amazon Assistant for Firefox.   This is a plug-in for Firefox that allows you to download your reviews from Amazon as well as the video reviews. He then takes those videos and puts them on his YouTube channel and links those back to the product listing.

Kevin has found that Amazon is a great way to refine and improve your products for another stage. He is looking into getting into big-box stores like Sears or Wal-Mart and has been taking feedback from his Amazon customers to make sure his products are at the highest level. The last thing you would want is to get into a big store like Wal-Mart and have a low quality product. You are going to have a lot of returns and the stores aren’t going to want to carry your products anymore. So use the feedback you get from Amazon and tweak and improve your products.

His long-term goals is to create a strong brand in these big-box stores so that he is covered if something happens with Amazon. If you’re looking to make this a full-time job then at some point you will need to expand beyond Amazon because at anytime Amazon could decide to unlist you. Therefore, in order to survive elsewhere, it is important to build a strong brand. Kevin is looking to take his brand to $10 million a year by the end of 2018 and he is well on his way to reaching that goal.

Kevin explained that he doesn’t want to have a huge business with a lot of employees. He tries to take care of as much as he can by himself because bringing on other people will really eat into his bottom-line. So he isn’t a big fan of outsourcing too early. However, many people don’t have the same background and might need help with shipping and freight and will need to rely on outside help.

Kevin is also looking to expand his business into the UK. Once he gets his VAT number he will be ready to test the waters in Europe. Europeans have very similar cultures to that of the US and are just as willing to spend money. The UK has the highest ratio of online shopping to income in the world. That means that they spend more of their money online than anyone else. Plus there are 60-70 million people buying that have similar cultures and buy similar products, so the UK is a great opportunity for expansion.

A big advantage to selling in the UK is that it will be much easier to expand into other parts of Europe. Customers in, let’s say France or Germany, will have the opportunity to have their products shipped from the UK. When his sales reach a certain point, he will have to open accounts in each of these countries, but until that point he can base it all out of the UK.

A word of warning is that you need to make sure that your products can have a high enough margins because your costs may be higher when selling in other countries due to regulation cost, but more importantly, currency exchange rates. For Kevin, he will be buying everything in USD, but selling them in the UK with GBP. If he has a slow moving product and ships 1000 units, it may take him a year to sell through them. In the meantime the pound gets stronger against the dollar and now he’s losing money. For UK sellers, certain political events are having an effect on pricing, e.g. the Brexit.

What can listeners do if they want to get a hold of you, or find out more about you?

Kevin has considered consulting but doesn’t feel strongly about continuing that. He recently offered a free 15 minutes session and got about 30-40 hits on it from all over the world. Over a few days he worked with each of them, looked over their listings and helped them improve. He quickly realized that you can’t do both. You can’t do consulting as well as selling. For Kevin, consulting isn’t scalable. He can’t make money while sleeping unless he makes a course. At the rate Amazon is changing the course will quickly go out of date so he will focus on that. He is considering starting a mastermind group in the future where people can come in for a four hour session but that would be it.

Other than that you can find him on several of the American Amazon FBA groups on Facebook or just look him up on Facebook, Kevin King in Austin, Texas.

What do you see coming in 2016 and 2017 in the future of Amazon?

  • An increase in the cost of pay-per-clicks as more and more people and brands begin to see the value in it.
  • Amazon will likely clean up the catalogue. This has already begun with limitations on titles and bullet points. Kevin believes it will go even further by cracking down on images. You’ll probably see fewer banner ads and such and a heavier enforcement of guidelines.
  • Part of the problem is private-sellers who are both good and bad. Third-party sellers make up more than half of the sales on Amazon which means more money for Amazon. However, you have a lot of products that are the exact same thing just under different names. To address that you might see higher barrier to entry.
  • One such barrier could be a crackdown on UPCs. Rather than buying official UPCs from GS1, sellers are buying duplicates on eBay. So rather than being another seller on the same listing, they put it under a different UPC and have its own listing. So one thing you might see to combat this is to unlist the product if the UPC doesn’t match the database.
  • Another prediction from Kevin is an increase of big brands. Right now these small private sellers are able to compete because the big brands don’t have much focus on Amazon. They have some low-level employee putting generic information on the online store just so they have a presence. One change could be the brands putting more focus on Amazon and having a stronger presence. This could be an opportunity for some sellers. If things aren’t working under their own brand, they could approach these big companies with their experience and offer to handle their Amazon business.

Do you have any final words for Amazon sellers?

If you are willing to work hard, put in the time and dedication, and have a little money to play with, you will succeed. Just stay positive. take your failures as they come; learn from them and get better.

#56 Marketing Mastery Mini Course: Principle 3: optimize!

Problem #3:  Low Conversions

Result: Wasted Ad dollars, lower sales, lower profits.

Solution: OPTIMIZE!

To find your conversion rate for each product on Amazon, there are two sources of info:

  1. Overall Conversion data:
    1. Go to “reports” on top menu
    2. Click on  “Business Reports”
    3. On left find “By ASIN”
    4. . Click “Detail Page Sales and Traffic”.
  2. For Amazon ads conversion data:
    1. click on “Reports”,
    2. from drop-down menu click “Advertising Reports”,
    3. at the top middle, click on “Search Term Report”.
    4. If needed, click Request Report button
    5. Under “Check Report Status & Download” if needed on the right click “Refresh” button
    6. on the right, click on “download” button next to latest report
    7. Open report as a spreadsheet
    8. Search for “Conversion percentage” .

Analysing Amazon ads data is a big topic in its own right. If it’s overwhelming you, just start with the global conversion data.

    1. PHOTOS
      1. Main product shot is CRUCIAL!
        1. try to differentiate from competition main shots
      2. use the first 7 shots (including the main) for most important things as last 2 are hidden unless shoppers click on them
      3. Have at least 2, maybe 3 shots with a model using the product, preferably in a logical sequence, or if it is is not totally obvious how to use a product.
      4. If you have more than one product, have the 7th shot show a composite picture of your other products, preferably with the ASIN code under each and a little text telling shoppers to put the code in the search bar
      5. Use the last two shots for little product details
      6. Many sellers also put text on their images, effective mini bullet points. It may be against ToS – but it seems to help. Your choice how far you want to push it!
    2. KEYWORDS
      1. For Amazon’s algorithm
        1. This matches customer searches to keywords in your listing
        2. Use Amazon Ads data if you have it: which keywords give best ACoS? Best sales in absolute volume? 
        3. If just starting out, use AMZTracker or other to examine the competition.
        4. Also keep an eye on competitive listings
      2. For Humans:
        1. Make sure the relevant keywords are woven into the copy
        2. Try to focus on those words that convert well if you have data
        3. If no data yet,
      3. Three places to optimize:
        1. Title (obey Amazon’s rules eg 80 character limit
        2. Bullet points – bear in mind features into benefits
        3. The Keywords tab in Seller central>Manage inventory>[Product]>Edit
    3. TITLE:
      1. Get most important keyword first
      2. Ideally get your product title in next
      3. Your brand is least important as most people have never heard of you!
      4. Check Amazon’s latest ToS – including length (may now be limited to 80 Characters)
      5. If you have data:
        1. you can match up best converting/least expensive/most sales keywords with your title. It may not be what you think.
        2. Your best converting keyword may not be the one that makes you most sales. Likewise it may not be cost effective ie profitable
        3. SO analyse your data carefully!
    4. BULLET POINTS
      1. Turn Features into Benefits, e.g. This light has Xenon 214.B lenses – so the light is more focussed, brighter and more visible at night.
      2. Keep sentences short. Keep words short. Assume 8-10 year old reading level!
      3. Be clear! Always answer the “So what?” question.
    5. DESCRIPTION
      1. Flesh out your bullet points
      2. Use simple HTML if possible: <b>bold</b> etc.
      3. Again features become benefits
      4. Don’t spend too much time on this because
        1. The Amazon algorithm doesn’t index it any more
        2. it appears below several offers from Amazon of your competitor’s products! It’s too late!

Product Example A

Sales Price  $15

Total Landed Cost $5

Amazon fees $5

Gross profit $5

Amazon ads costs

100 clicks @ $0.50 a click=$50 ad cost

Relationship between conversion rate and profit per unit

example A1 (sales price $15, gross profit $5)
At 20% conversion rate:

20 clicks out of 100 result in a sale.

Ad cost total=$50

20 sales @$5 gross profit=$100 gross profit

Profit after advertising (for 20 units)=$50

So profit after advertising per unit=$50/20=$2.50

Example A2 (sales price still $15, gross profit still $5)

At 10% conversion rate:

10 clicks out of 100 result in a sale.

Ad cost total SAME= STILL $50

10 sales @$5 gross profit=$50 gross profit

Profit after advertising (for 20 units)=ZERO!

So profit after advertising per unit= ZERO!

Relationship between price, conversion % and profit

In practice, conversion rate is strongly affected by price. The lower the price, the higher the conversion rate tends to be.  NB This is not always true if higher price gives a perception of a better quality product- test your prices!

compare with example A2 above.

Product example B1 

Sales Price  $14

Total Landed Cost $5

Amazon fees $5

Gross profit $4

Amazon ads costs per 100 clicks (average): $50

At 15% conversion rate: (Sales price $14 , gross profit $4)

15 sales @$4 gross profit=$65 gross profit

Overall Profit after ads costs=$65-50=$15

Profit per unit=$15 overall profit ÷15 units=$1
Although the price is $1 lower ($14 instead of $15), the profit is actually greater per unit ($1 a unit average over zero) and greater overall (15 units sold at $1 profit per time instead of 10 units sold at no profit)

Split testing

To find the price at which you optimise overall profit, you will need to do some form of split testing.


Simple/primitive method: You can just run the listing at one price for 7 days (or longer) then change the price and repeat. Then compare results. Without software, that’s the best you can do on Amazon.

All other things being equal, that will tell you what effect price has on conversion %, overall sales and overall profits.

However, all other things may not be equal e.g. if the demand for your main keywords happens to drop off that week due to say a national holiday, good weather, etc.

To get a more reliable result, you need to use split-testing software. In the USA, I’ve just started using Amzsplit= Splitly

Sadly it is not yet available for the UK, although they keep promising jam tomorrow! I’m exploring a UK equivalent – if it works, I’ll let you know in the Facebook group – don’t forget to join if you haven’t already!

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3

#51 Using Amazon Suppliers & Building Quality products with Manuel Becvar of Import Dojo – Part 1 of 2

   This episode, #51, is the first of two parts of the interview with Manuel Becvar of Import Dojo. Manuel has 11 years’ experience of sourcing in Hong Kong and China and also is an Amazon seller with several product lines live and selling well. 

EPISODE 51 SHOW NOTES

What took you to Hong Kong?

Went there for a 6 month internship  for an Austrian electronics firm in 2005. He was handling sourcing from suppliers. He fell in love with the city and a woman and never left!

He loved the drive and opportunities of Hong Kong. Very expensive but great place to live.

Do you also sell on Amazon?

Yes since August 2014. Also documented launching a whole brand. He currently has 7 products and 10 more coming in the next few months.

He’s focussed on getting after 3-5 categories in different categories. He launched then stopped a few more.  He has several businesses which were more of a priority till now.

What are they?

  1. Selling on amazon
  2. Sourcing company in hong kong for amazon sellers.
  3. A consulting and import course, step by step guide to import from china and sell on amazon but also sell to retail.

He started out with a consumer electronics brand, selling to retailers in Europe under own brand and their own brand, but also now on Amazon. Now Manuel is focussing on his own Amazon business as it is really picking up.

Tell me about stopping a product?

He used to sell smart phone accessories but then the prices got so low there was not much profit. Electronics can be very competitive.

What’s your process for selecting products? What are your selection criteria? Do you go by the numbers of individual products? Or build a brand in a niche?

Manuel is more old fashioned, doesn’t use Jungle Scout or ASIN inspection so much. He subscribes to relevant product websites. newsletters, goes to trade shows. Also looks at Kickstarter and Indigogo for product concepts.

Manuel doesn’t look into creating a huge brand in one category. Tries out one product in a niche e.g. coffee press. If that takes off, build into that niche. If not, don’t go into say grinders, filters etc. 

Coffee press now selling about 20 a day.

How do you  beat the competition?

you need to stand out to beat the competition.  Tries not to copy the competition. This is his approach. Will Tjernlund does copy the competition, but Manuel is more interested in creating unique products and building a brand.

How can we make a product unique in a simple way?

Example 1: Blue tooth speaker-

The sample looked bad, plastic finish, bad sound, packaging horrible. 

The finish rubber instead of plastic was 20 cents more but immediately looked better.  Then looked at components, sound was bad, different driver sounded much better and cost just 50 cents more.  Used photographer to get better photos. 

He turned a $10  product into a $30 product but only cost him $2 more.

Focus on finish, minor improvements etc.

Example 2 – Coffee Press

There are  lots of stainless steel finishes, but no copper finish.  So Manuel had that done and added in extra filters etc.

Look at the little things you can change.

Tell us about working with suppliers. What’s the best way to approach your supplier about this?

Introduce yourself including company presentation –

Create an excel file or word doc about the product- include bullet points, this is where it’s at, this is what i want instead. 

Also point out that if you improve the product, they will make more sales with other customers as well. so they are more willing to make changes with costs.

So you’re not trying to get an exclusive deal with them?

Amazon sellers are mostly a small part of a suppliers’ business. if Manuel does say $10,000 a year he’s a very small fish. that may be 0.5% of their turnover if you work with a big factory (this is true for his own coffee press. They also work with Tesco’s who order $1m a year)

How do you get an exclusive deal for amazon rights?

He has set up an agreement with the Purchase Order which says – “My plan is to order 10,000 units. Are you willing to give me exclusivity for a year. If I don’t reach 5000 units within 6 months, we can cancel this agreement. “

This give Manuel 6 months to figure out if he wants to place more orders and it means the supplier can make more profit too after 6 months. 

Manuel is okay with that because he would have a head start, maybe 100-200 reviews already. It’s okay to have competition. It’s not all about one item only.

Manuel is happy if he can do 6 months of excellent sales on one product. That repays the time and money invested already. 

Greg Mercer was saying if you get 6 months’ head start, you can defend your product against competition. So you agree with that?

Yes, that does work.

Where do you go to look for suppliers?

Manuel has collected over 1000 business cards for suppliers from previous job being a product manager, when he went to China every 2 weeks.

Manuel also works with a lot of trading companies. He will sometimes be willing to pay say 50 cents more and use a trading company, similar to agent. Some of them work as if you are working with factory, for example if factory doesn’t speak English, don’t know about country requirements eg CE (European Union), FCC (USA), FDA (Food & Drug Administration, USA) approval, doesn’t have experience exporting to a country, etc., etc.

So working with a trading company can make a lot of sense.

Alibaba and Global Sources Manuel does use if he can’t find anyone through his network – you can verify and vet the suppliers. You can still vet them by checking their certificates, asking who they work with,  Which markets they export to etc.

For example, If Manuel asks “where do you export to?” and they say, “Middle East” and you want to export to USA, don’t bother. He wants a supplier

It’s also good to know a few names in the industry eg small supermarket or worked with an Amazon seller before. Check business certificate.

What are the big does and don’ts for selecting a supplier? Assuming Alibaba, Global Sources or HKTDC and someone who is new to the process.

There is a lot of filtering you can do. e.g. a microwave on Alibaba, filter by Gold Supplier, trade assurance, 3rd party verification.

You can also filter by region – say 10 different provinces of China.

Let’s say Guangdong have 5000 suppliers and another has just 10. That shows you where the main factories are for this kind of product.

If a region specialises in making those products, they have the resources and the infrastructure.

Say in Jeijung province, with 10 supplier results, they probably don’t specialise in that.

There are many other filters you can use.

Send out enquiries to 10 suppliers. 3 or 4 get back to Manuel with and answer all his to Qs

Email out “vendor profile”,  asking for:

  • 2 customer references for customers
  • markets. Has he exported to this country before?
  • business certificates, and certificates for prods
  • no workers; when company established; annual turnover.
  • do they do R & D? Have their own engineers? how many product lines?

You get a gut feeling after a while.

This is included in import dojo ebook as a downloadable document.

Import Dojo is actually a 60-page book which is a bestseller on Amazon! It is free at the company’s site. 

 What’s next in your process?

Get a soft copy of any certificates needed – prove he has it!

IF that’s okay, then ask for a sample from at least 2-3 suppliers. Same process with all suppliers.  If all samples are equal, go with most responsive/proactive and helpful supplier, even if price is a little higher. Then place an order. 

So you’re okay with higher prices?

They need to make profit too, they work hard. The factory will be business partner, it should be a fair biz relationship. As long as profit is built into your price, it’s fine to pay a little bit more.

If you have individualised products and with good product price, you can afford
If you’re building a brand, if you squeeze in cheap products, it won’t help. 

I guess it depends on whether you have customised products vs. commoditised products sold en masse?

Yes, I’m building a brand, so selling cheap products to make a quick buck is not part of my strategy.

What is the best tip for negotiating on product price once you have verified that the quoted price is in the fair region? Should simple customisations really cost that much more?

There shouldn’t really be a big difference. Unless the supplier has to invest money into a new tool or a new mould. If it’s just a colour difference, it shouldn’t be much.

To find if it’s reasonable, ask at least 3 suppliers for a quote. IF one is way off on price, he’s either incompetent or trying to rip you off!

To contact Manuel, click here for the Import Dojo contact page.

NEXT EPISODE

In Episode #52, Manuel gives details on keeping your money safe, getting quality control for Electronic Products, simple ways to start with Freight, overall process and predictions for the future of Amazon. Stay tuned!

HOW TO SUBSCRIBE TO THIS PODCAST

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This will help you to download the free Podcasts App (produced by Apple) and then subscribe to the show from within that app.  Every time I produce a new episode, you’ll get it downloaded right on your iDevice.

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#47 Amazon Keyword Research, Amazon USA vs UK and Quality Control – Q & A Tuesday no 4

#47 Q and A Tuesday no. 4 SHOW NOTES

Q. 1 David G.

Merchant words vs KWI for accurate kW search volumes?

Danny :

Both use algorithms rather than qualified data from Amazon’s servers. Use as guidance rather than absolute numbers. The best data will be from your reports.

Michael: remember that all research numbers before you have product live are an approximate guide. If the numbers look good, go ahead and place an order, but just place a small one. You could go to AliExpress and make a really small order of say 20-50 units. Or go to a supplier on alibaba.com who will accept a small MOQ. Then launch the product with a few reviews and see if you can get sales at a reasonable price.

Either way, then you will get real data which you can then use to decide whether to place a full sized order.

Q2.  Kurt

Hi all, I am currently selling on co.uk and I am wanting to start selling on the .com market… do I need to create a brand new buyers account (with different email address) and then use that to create me .com sellers account?

Thanks

Hi Kurt, yes you do need a separate account. The advantage is that your business on amazon.com is separated from amazon.co.uk. So if there is a global issue (like account suspension) in one marketplace, you are safe in the other one.

You can link the reviews for a product between the two marketplaces as long as it is the same ASIN. This can be very helpful if you have for example a product that did well in the USA and you want to take advantage of the reviews in the UK. This is only going to work if it’s the exact same product.

Ruth B

Advice needed asap –

I have had long delays with my first order, the initial colour changes and gift box design took longer than expected and then it failed the inspection in China. 

My supplier said they would rework the problem items and with the canton fair happening, instead of the promised 3-4 days this took more like 3 weeks. 

I have had it reinspected and it still hasn’t passed – the previous major problem has been fixed but various other problems were found – all cosmetic – scuff marks, glue marks, slight gaps where the 2 materials meet (only a couple of these), damage to gift boxes. 

In total there were more defects found in the second inspection than the first (including major and minor defects). 

Where do I go from here in terms of negotiations/demands with my supplier?

I don’t really want to say goodbye to the product and lose my deposit plus all the time and effort that has gone into differentiating/designing etc, but i also don’t want to risk receiving an order of a defective product. 

The inspection pictures of the products without defects do look really good and the finish looks good quality but there do seem to be a number of defects which would result in returns. 

Having failed the first inspection my supplier agreed by email to replace (including shipping costs) any damaged items that might arrive in the UK, but how do I know they will actually stick to their promise as this is my first order with this supplier?

Nigel:

Ruth, sorry to hear that it’s a bit deflating and it happened to me with my 1st order last year. Our solution was

to have all our 1,000 items checked & pay for the ones that are ok & leave the others (after 3 inspections!)

This resulted in 203 out of 1,000 being passed &

given we paid 30% upfront we actually got a small refund.

Remember most inspections fail initially and you can accept or reject the order despite the result . Well done you though for having an inspection – many still don’t bizarrely & it’s saved you a big problem down the line.

In the end we had to change supplier for future orders.

Michael: Nigel’s advice is good.

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