mindset Archives - British Amazon Seller - the UK Private Label Specialist

Archive

Category Archives for "mindset"

190 How to Sell in Amazon Europe with Gil Lang Part 2 of 2

Today we will be delving further and looking at Amazon Europe. In Part 1 we spoke with Gil Lang of Private Label Journey, a German Amazon seller about the mindset of German consumers and the challenges and opportunities of building an Amazon business in Germany.

Continue reading

154 Time Management for eCommerce with David Aggiss Part 2 of 2

The great thing about running an Amazon business is the freedom it allows in your personal life. You can go on holiday as you want and you can take a day off as needed. You set your own schedule and make your own deadlines. That also creates one of the more difficult aspects of your job as an Amazon seller, time management. Today on the show we have David Aggiss and we’ll be discussing time management techniques when you’re running an online business.

Time Management for eCommerce

If you are first starting out, the challenge is finding enough time to work on your business. You have your full-time job, maybe a spouse and children, then your Amazon business on top of that. It’s going to lead to some late nights and long days. That’s the struggle of it. It’s important to set aside time-blocks for specific tasks. If you start working without this, you’ll end up working on a number of things and accomplishing nothing.

Customer service is a daily task. You’re probably going to be in Seller Central a lot anyway, which is a good thing so you can respond to customer questions and other issues as they arise. Once a week, you want to look at your listings. See if there is any way to improve them. You should take a look at your PPC and keywords to make sure they are performing how you want.

Time Management when Expanding Your Business

Expanding your business is an evening job. If you are looking to research new product lines or find new suppliers, make sure you have a few weeks available where you can put in some serious evening hours. You’re going to have to work everyday with emails back and forth with your suppliers, especially if they’re in China. Unless you can get on a Skype call, this process could take a week or more because of the time difference.

Skype is recommended to help speed up this exchange. However, keep in mind that if you’re looking into several suppliers, that Skype could get overwhelming. It is easier to maintain all the information if you limit it to email since that has understood, built-in limitations. Also, you will have a record of everything discussed.

Outsourcing

If you find that you don’t have the time to handle everything that you need, consider outsourcing. Be aware of what your strengths and weaknesses are. Focus on your strengths, outsource your weaknesses.

If you are making enough money from your Amazon business that you can afford to outsource, then you are probably pretty proficient at the day-to-day Amazon tasks. Then you’ll want to continue to handle those. If your background is in web design, then build your website yourself.

If, however, you don’t know the first thing about building a website and you have no idea how to work on social media, outsource those. Chances are you can find someone that will do it better and faster. If a task is going to take you a week, but someone who is an expert can do it in a day, pay them to do it. The task will get done several days soon and you now have that week to work on something you’re an expert in.

Focus Management

While time management is important, focus management is as well. Like I said before, you have the freedom to make your own schedule, but you don’t have a boss to keep you on track. It’s easy to lose focus and let your business suffer because of it. You have to keep in mind why you want to run your own business. Whether it’s to have a luxury house, nice cars, or to simply spend more time with your family. Whatever it is, whether it changes over time, always remember that and let it be your motivation to stay focused.

143 Selling on Amazon 2017 by Brad Moss of Product Labs – Part 4 of 4

What are your big picture things that you’re looking out for in regard to Selling on Amazon 2017?

Brad’s very first day at Amazon, he was working next to a guy named Tor. When asked what he was working on, Tor responded that he was working on the GCID program. It stands for the Global Catalog Identification system. This means that people can have a brand, and put their own brand on Amazon and have these account numbers linked to their brand. Brad says that this was the start of the whole brand revolution that has happened over the past three years. People have discovered that private labeling is much better than competing by the box. Instead of people competing over the same item using the pricing algorithm, many have moved to private label and own the ASIN. Now they get all the sales.

This year, with all the fraud stuff going on, Amazon is figuring out brand protection and brand control, and those are big things coming from inside Amazon; trying to get more brand control and brand protection. Big brands, like Sony, was the originally intended beneficiary. These companies have a lot of products with fraudulent listings. Then they realized they could extend it for a lot of people.

Amazon has gotten more into brand gating, and brand content because of these sellers. This is likely going to be the beginning of a program that sellers love. Amazon will get that feedback and keep building more and more around your brand. This also builds consumer trust.

Consumer trust is a big thing lately. A lot of people have come out about getting defrauded by Chinese sellers not being forthright about the authenticity of their products. Now Amazon has a big PR battle to deal with.

That’s a big issue. That’s a major differentiator between them and eBay. eBay feels more like the wild west whereas Amazon was more in control with actual brands. So consumer trust is one of, if not the, biggest thing on Bezos’ mind.

When things like that come out, all the big heads come together and institute new programs to solve whatever problem. Amazon is trying to solve the fraud issue with brand gate and brand control.

You said there were two things about where Amazon was heading. What was your second thought?

It’s not so much about where Amazon is heading, but rather the minds of the brand owners needs to be going in. You have a lot of these large brands that really understand brand management because they have been doing it for 50 or 100 years. Amazon has enabled these new sellers and they are powerful and effective at building their brand.

The idea, for the last couple years, is that these people have gotten a certain part of the brand going and now they have to determine where to go from here. Over the next couple years, you’ll see more sophistication in the brands. Who the brand is, who identifies with it, what’s the target audience.

You mentioned the Chinese sellers. Obviously, Amazon is courting them, and trying to create a link to them. They’ve gone so far as to open offices in China. How can we, in America, the UK, or anywhere else in the world, compete with the Chinese sellers trying to sell direct on Amazon?

It comes down to what do you mean by compete. If you think about what the Chinese are good at that those in the UK aren’t. They have manufacturing there with some very competitive costs. There are other manufacturers in the world that have better prices, but they’re harder to reach because you can’t look them up on Alibaba.

The bigger question is, if these manufacturers can cut out the middlemen and sell direct to consumer, where does that leave these middlemen that are trying to create a brand? That’s what the majority of these sellers are.

Many of these manufactures don’t have the acumen to be that middleman. They’re not very good at it. The middleman is very valuable. They are doing the work to build a brand and they’re doing the research on what’s going to be a big seller. There is a place for sellers. Remember, just because these manufacturers can make the products cheap, middlemen are still needed to figure out what products need to be marketed.

There is some worry about counterfeit. If a seller does all the research and comes up with a brand idea, and what if someone else takes the idea and sell their own. Brad spoke with some attorneys when he was in Hong Kong. They said that you can actually set rules and regulations of your products with the manufacturer. That way they can’t take your product and sell it to someone else. You can work within the Chinese system and shut down other manufacturers if they copy what you’re doing.

Just remember what they can do, what your can do, where the value lies, and how your brand can gain consumer trust. How often is a Chinese manufacturer gathering emails, and sending emails to their customers. That’s a very western idea and way of thinking.

You can email Brad at brad@productslab.net, or use the contact form on their website, productlabs.net. If you would like to use his video service, please go to amzproductvideo.com.

 

140 Brad Moss’s Lessons from Running Amazon Seller Central – Part 1 of 4

Brad Moss was the Business Head of Amazon Seller Central itself. Which we all are at the mercy of. He built the Amazon Seller Central mobile app. He now does consulting company for Amazon sellers, Product Labs.

Tell about how you got into Amazon Seller Central.

Brad got his Masters in business. He did some entrepreneurial things, launched some companies which won a few awards for some of them. He was successful in small realms and wanted to see if he could have an impact in a bigger realm, like Amazon. When he first go there he built something that no one has probably heard of because it didn’t launch. It’s called Gamification for Sellers. It was a really cool system that was held up because middle management was fighting over some resources Brad had. It would have made selling more fun and would have been able to track yourself.

When he finished, he had learned so much about Amazon Seller Central and how the system works that they decided to put him over Amazon Seller Central. Amazon had 168 teams that were dispersed through Seller Central. Each team was adding to the system, putting new tools here and there, without a real overhead strategy. That was Brad’s job.

He started putting frameworks down, and added the advertising tab. That team came, for sponsored products, saying they wanted to put it in Amazon Seller Central. Brad felt it was big enough that it should get that spot on top. Seller Central has become a beast unto itself. He wanted to overhaul the entire system, and scoped out how to do that. That only got so far when they starting think about the future. What’s the future of selling and the future of devices. At that time, mobile had come up.

There were a lot of people trying to do mobile at Amazon. They decided to focus on mobile and Brad made a case saying that they would make a lot more money if they focused on mobile. It would be more accessible, people would be able to check their seller account, they’d be able to scan things, and put new products up on Amazon. They passed the idea to the VPs, got the funding and built the Amazon Seller Central mobile app.

That’s a heck of an achievement. Millions of us use that app on a daily basis. Now, you said there was 168 teams, why so many? Why not just one? That seems to be different than how almost any other company does it.

Those are systems and programs. So one team may have five systems. The internal structure at Amazon is really cool. It works really well in some situation, not so well in others.

When you’re there, you’re free to take your program, and figure out how to make it happen. When I was working on the gamification, I had my own team. I made the business case that it would improve the business for Amazon. Then we had to figure out how to get this new system, into the existing system.

We had to find the two engineers that were running the front page of Amazon Seller Central. Then we found several engineers that were running the back-end with the listing services. We had to go to all these different teams asking them for a day of their time to help us get into their systems. Amazon promotes that kind of culture where it’s very entrepreneurial. It’s up to you to figure out how to make it happen. It’s not coming from the VP telling certain teams to do this thing. They had to figure out the best way to get these systems to work. They had to negotiate and bribe with drinks after work.

That sounds a lot like a connection. I run a mastermind and belong to another and it sounds like a situation I’m in now. Asking another member to help me with Facebook ads, because they specialize in that and I’ll help them out with what they need.

It’s almost like the wild west in a way. It gets even worse when you have different VPs that have their own goals and directives, and it all comes down into one system. That’s where Brad was with in Amazon Seller Central. All these different VPs were all trying to pipe into the same system to accomplish their goals and there was no central authority to facilitate it. It’s pretty wild.

The perfect example is if you look under the reports tab, and there is business reports, and payment reports. Then there is this thing called fulfillment reports. If you go to Fulfillment Reports, it takes you to a new page with a lot of reports on the side. That section is owned by the FBA team, which is a different vice president than the marketplace team. The FBA team wanted to be able to keep adding new reports without having to go to seller central or the marketplace team every time. So they built a new page that they have full control over. However, it doesn’t make much sense from the user’s perspective.

Well that explains a helluva lot about Amazon Seller Central. A point I made earlier is that it’s important for sellers to understand things from Amazon’s perspective. You mentioned that you had to made a case to Amazon demonstrating how they will make more money. What are the drivers? Obviously money is a big driver for any company, but what other factors help push the senior management to green-light things?

When Brad first started, he was looking into a business case that someone had mentioned. He looked really deep into and thought that it would be really great. He made his report, show the analysis, and told them it would be a $30 million business if they do it. His director just shook his head and said no. That unless it was $1 billion over three years, they wouldn’t go after it.

That’s what made mobile so difficult. It was a really hard case to make. If a majority of the money comes from huge sellers on the marketplace, how would they use mobile, and how would mobile enable them to make more money because a lot of them just use API and feeds anyway. That’s what made the business cases so important.

That’s what is great about Amazon is that the mentality , from Jeff Bezos, is “It’s day one for the company.” The idea that they are still laying the foundation and groundwork for the company. If you do enough diligence from the business side, which was Brad’s job, and look at various things to be building, you can find these opportunities. Don’t settle for $50 million opportunities when you can find a $1 billion one.

You can see how that would trickle down. While working on Amazon Seller Central, people would propose improvements. The question came down to, how many sales will be generated by adjustment. If they can’t prove that it will increase sales, then they don;t get funding for it. So it’s pretty difficult to get funding to make those nice visual adjustments. There are resources called “Keeping the lights on”, that is some resources allocated to keeping things running, and they might be able to scrape resources from there to make those minor adjustments.

131 Are your Amazon Ads Killing Your Profit?

Today we are continuing with our giving-up list. What are you going to give up in 2017? Before you start doing something, you need to stop doing something else. You must free up your time, money, and mental focus. Today we will be discussing sponsored ads, or Amazon ads. Amazon calls them sponsored ads. Broadly speaking, they are one of a few ways you can that drive traffic that is moderately guaranteed to work.

Amazon Ads

If you have a product with terrible conversion rates and a decent amount of reviews and that’s not shifting over time, and you’re driving traffic with pay-per-click, then you have a problem with your product or listing. But if you have decent sales and the conversion rate isn’t terrible, not below 10%, then what is going to determine your profit will be the balance between the sales price and the cost of goods sold. A big percentage of that is your Amazon ads.

If you increase your price you could negatively affect your sales, however, if you reduce your cost, by reducing money spent on Amazon ads, then you will increase your profit while maintaining your sales. Which is obviously a big win for you. 

It is very important to use negative keywords if you’re using auto-campaign. I always suggest using auto-campaign to start with because you can gather a lot of data and tune the algorithm to your listing.  But after a while (say 1-2 weeks usually) you shouldn’t be spending a large bid-per-click on that.

Using Negative Keywords

Go through your search term report, and anything you’re spending a lot of money on, that doesn’t bring you sales, is something you want to put in negative keywords fairly soon.

How soon? Well, if you are really serious about your products, you have signs of good success on your hands, and deep pockets, you might want to run a loss on that campaign for a rather long time in order to gather data.

If you have 50 clicks on a keyword and no sales, that pretty certain that it’s not working. You’ll want to make sure that’s a negative match keyword. However, to get 50 clicks, you likely spent a lot of money and you might want to have a cutoff at 5, 10, or 20 clicks.

The next thing you want to look at is the keywords that are making sales. These are probably going to be a small percentage of all the keywords you’re using. Over time, you’ll start gathering your long-tail keywords, but starting out, it’ll likely be around 10-15. That all depends on how much you’re willing to spend before you make sales.

Unless you want to be really harsh, after two to three weeks you’ll have your 10-15 keywords that are making you sales. You’ll want to look at those and reduce the bids on those which are costing you too high of advertising cost of sales.

Advertising Cost of Sales Metric

One caveat, don’t allow advertising costs of sales to be your main guiding point. When you launching products, you’ll be raising your prices over time. For example, if you’re spending $10 on advertising on a product you’re selling for $10. That’s 100% ACoS (Advertising Cost of Sales). Over time, you might raise the price to $15 which change that ACoS dramatically. So I wouldn’t recommend using that as a metric. It can be misleading until you land at a stable price.

What I would recommend looking at is the overall spend on advertising divided by the overall sales. A very simple, robust metric that you should monitor weekly at least. 

This isn’t something Amazon will give you because they want you to spend money on advertising.

It’s very simple to calculate. Get the same time period for both; you can get your advertising costs from the seller central “Advertising” tab, and you add up how much you spent. Then you go back to your business reports, and add up the sales you made in the same exact period period. Then just take your advertising costs and divide them by your sales.

The main thing is that it’s not about the advertising cost of sales, it about profit. If my profit margin on an item, before advertising, is $3, then I can spend $3 on advertising before it becomes a loss.

Another thing to consider, is that, if you have a decent selling product, you may be willing to run at 100% ACoS. That is, you’re running a loss on those sales from ads. You will still rank organically because of the ads, and you can make your money from organic sales.

I wouldn’t recommend it if you’re not being aggressive and really looking to grow your sales volume. I prefer to keep my ACoS where it is break-even. Let’s say I am selling a widget for $10, and my total cost before Amazon ads, including Amazon fees and fulfillment costs etc, is $7. That means, before ads, my profit margin is $3. I would not want to spend more than $3 per sale averaged over all my ads. That means that all sales gained via Amazon Ads are at breakeven or better, and that all organic sales represent profit. 

Additional Help

I know this is complicated and it’s not really meant to be an instruction guide for pay-per-click ads. If it’s the sort of thing you need help with and you want to get in touch with me, I do offer a one-off call with you through Clarity FM. It’s  $2/minute so it’s an expensive way of working with me. You’d be better off joining my mentorship program if you want ongoing help. Although I’m pretty strict about who I work with,  I do have room for one or two more people. If you’re interested, still apply, and don’t assume I won’t work with you. Just read the guidelines and FAQs first though.

 Another, inexpensive, way to work with me, as well of several others, is to become a part of the mastermind group. The London mastermind is in full swing and we’ve had meetups with about 6-10 people, which is perfect. We have dates set from January to June if you’re interested in working with me and up to 10 other people.

PPC Entourage

One last word on pay-per-click, I am trying out some software called PPC Entourage which they claim will help you manage your pay-per-click very quickly and easily. I haven’t had a chance to really dive into it but I will give it a test run and report back to you. If you want to try it, you can get a copy at http://ppcentourage.com/.

The London Mastermind

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

130 When to Abandon an Amazon Marketplace

Welcome to part 2 of what I’m not going to do in 2017, my stop-doing list or my giving-up list, if you will.

The next thing on my list after giving up products that aren’t profitable or don’t sell, is to think about the marketplaces that you might stop selling in as well. Certain marketplaces will be better suited for certain products. For example, if you wanted to sell barbecue equipment in the UK right now, while it’s in the middle of January and it’s freezing cold, you won’t do well. You might get a few hardened people (like me!) that walk around in shirts while it is 5° C, but not many. Certain products aren’t going to work out in certain marketplaces at certain times.

Tune Your Listing to the Amazon Marketplace

It may be that you sell a product in one marketplace and it does really well, then you try to sell it in another and it does poorly. You have to make sure to do the right things. You have to dial in your pay-per-click and your keyword research needs to be specific to each marketplace. Don’t be lazy and transfer over what you already have because it can work quite differently. Especially if you’re a UK seller trying to sell in the US marketplace or vice-versa. Don’t assume the keywords are the same, they often aren’t.

Let’s say, even once you’ve done that, and done your pay-per-click properly, and did a proper launch, your product isn’t taking off. I wouldn’t say to kill it, but maybe pause that listing and let your inventory sell off. This isn’t a product you’d want to re-order.

Know When to Walk Away

Classic example, I had a generic product in the US marketplace, we’ll call it a blue  widget, sold great, but only at a certain price point which wasn’t profitable. If I raised the price, it would drop to page five and sales would disappear. Now a niched-down version of that product, call it a stainless steel blue widget , did much better. I sold 1200 units in six weeks at a 25-30% margin.

With those same products in the UK, it was a different story. The generic blue  widget version did a few sales a day at a profit. However, the niched-down version, the one that sold 1200 units in a few weeks in the USA, was very disappointing. It, maybe, sold one or two units a day, even though it was still on page one, albeit at the bottom. For me, that’s not worth the time and effort to keep doing that. I was then able to reallocate my money and focus into something else.

This isn’t so much giving up an Amazon marketplace as such, but rather, giving up a certain product in a certain marketplace. I encourage you to look at your numbers. Make decisions based on the data rather than what you wish was the situation. Just because you invested a lot of time, money, and effort into something, doesn’t mean you have to stick to it. You have to be willing to walk away if the data shows that it’s not working. It’s called a sunk cost and it’s an incredibly important discipline for all business people. 

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

129 My New Year’s Resolutions No. 1

Happy New Year!

I am back after a much needed break. It was nice to get away and spend time with my family and reflect rather than constantly being in action.

I’m going to be doing a mini-series focused on the idea of New Year’s resolutions. I will be changing things up this year and I’m going to resolve to not do things rather than the usual resolutions to do something; I’m going to take away instead of adding.

The Wrong Way to do New Year’s Resolutions

Resolutions tend to revolve around exercising more, going running, learning to cook, starting a business. Just stop. Where are these resources coming from? Where are you going to get the time? The money? The mental focus? Where is this going to come from to accomplish these new things?

My philosophy is: you have to stop some habits first. There is still 24 hours in a day. Your bank account still holds the same amount of money. Your anxieties, your stress, your reservation don’t magically reset with the new year. Whilst it is important to have a plan, I think it’s more important to make the space for these new plans. You have to make time, money, and above all, mental focus. While, for many people, mental focus seems less important than time or money, it’s not. Trust me. I’ve been at this game for a couple years now and your mental focus is your most important asset. All the money in the world won’t make you successful if you don’t have the mental focus.

My To-Not-Do List

The first thing I want to stop doing, is trying to pursue too many business models at once. At the moment, I am solely focusing on private label, and I’m basically going to stay with that. I’m trying to do various different things in my life and it’s time to give them up. The most important thing I have given up, is the last of my piano students. I wasn’t enjoying it and it was adding quite a bit of stress. While it’s important to have off-Amazon income, it was taking too much of my focus.

What can you give up from your daily/weekly schedule that will clear up time and mental focus? It might only be a few hours a week, but those few hours can be spent on better pursuits. For me, it means more time helping you out with the podcast, helping my mentees, or focusing on the mastermind group.

Learn to Give-Up Products that Don’t Work

I am giving up products that are a disaster. While that may seems obvious, it’s easy to fall into the sunk cost fallacy

. Launching a new product takes a lot out of you. It’s takes time, energy, and money. Once you put so much into it, you become attached to it and it seems like everything is wasted if you walk away from it. So you keep sinking more and more into trying to force it to work rather than cutting your losses and walking away. You have to take into account what the market will bear. The market being your consumers and competitors and the law of supply and demand.

I tried to make one product work and it nearly put my entire business at risk. It was getting many negative feedbacks (NOT reviews!) which could have led to my account being suspended. That would have put other products at risk that were actually performing well.

I have probably spent several thousand dollars on that product over that course of a year and a half. I put time and effort into it, spent some money and time with a designer,  hired a photographer. None of that matters because the market has spoken!

Another product I eliminated sold quite well around Christmas 2015. However, when I ran the numbers it just about broken even. I realized that if it’s not going to make a profit at Christmas, then it’s not worth the effort I’m putting into it.

Consequently, this year I had a niched-down version of that product and it sold even better. I sold around 1095 units during the Christmas season, and I only have a few left. I turned my cash over in a about three months. From the time I put the first deposit down until now. It was about 25% margin which, while not exciting, is definitely worth renewing. None of that would have been possible if I tied all my money up in that other product that sold, but didn’t turn a profit.

Harden Your Heart towards Your Products

By giving something up now, you can re-purpose those resources into something more valuable. My suggestion is to be hard-hearted about your products. If they don’t sell, cause problems for your account, or don’t turn a profit when you run the numbers, cut them loose. If you haven’t ran the numbers to find out whether you have been profitable, January is a great time to do it.

The London Mastermind

Need more personalised input on issues like this? Live in the UK in or near the South-East? You might want to consider joining us for monthly meetings where we can thrash out all the issues like this one for YOUR business. Check it out here.

128 Why Your Amazon Business is at Risk

I am going to be talking about something that, I think, doesn’t get talked about enough. That is the reality of what you’re dealing with in an Amazon business. I don’t want to be negative, this is a reality check and reality is not a negative thing if you deal with it in the right way. This can lead to a long-term, genuine, sustainable business. The key to that is dealing with reality and not a fantasy of what you would like to have.

Realism is Good for You Amazon Business

The first thing I want to mention is that it’s positive to be realistic. Some Amazon coaching can cast being realistic in a bad light. They are a little to happy, happy for my taste. Not that being positive, confident, and optimistic is a bad thing. Rather, it is important to face reality head on.

Caveats aside, Amazon is treating me well right now. I have several products doing well and I’ve sold almost 800 units in that past few weeks at a decent profit margin. I say that, because what I’m about to tell you may shock some people because they aren’t thinking clearly about what they’re doing. This has become clear to me after working in great detail with mentoring clients. I usually have about 6 – 8 clients and many of them are just starting out. Also, if that interests you, please take a look at my mentoring program. Many of these clients are well-experienced yet have some delusions about how Amazon works.. A couple have doctorates, some have been selling online for years, and some are in financial industries. Even they, don’t really get the nature of Amazon.

Business as Investments

Any investment and/or business is to get some kind of return. Whether you invest capital or your time, you are looking for a return on your investment. There is some sort of ratio between the return you expect and the risk you’re prepared to run. If you want low risk, low reward, you might look into government bonds. If you want a greater return, but are willingly to have more risk, the stock market is where you turn. Or you may decided to be a venture capitalist and invest in startups. These are very high risk investments, but if you do it right, it has very high rewards.

Now your Amazon business, a business that primarily depends on Amazon’s sales and marketing channel; how would you rate that in terms of risk/reward? Just because you’re building a business doesn’t mean you shouldn’t think of it as an invest-able asset. Likewise, for any investment you should treat it as a business and look at the underlying assets. If you are wanting to invest it Coca Cola, look at their business. Look at their competition. Consider legislation that is fighting against them, and any potential expansion possibilities.

Bringing it Back to Your Amazon Business

If a venture capitalist were to look at an Amazon business, one that has a proven market traction, they would see it as a very high risk, but a very high potential reward investment. Having a business with only one sales channel where Amazon is pretty fussy and can shut your account down over small things, is a very high risk thing. The rewards are very high, as I am seeing for myself, and they are real; just like the risks.

This has profound ramifications for how you deal with Amazon. For example: is running your own Amazon business a viable replacement for your full-time job? If you’re tired of your corporate job and want to strike out as an entrepreneur and spend more time with your family, is Amazon a good replacement for a paycheck? Often times it is advertised as such. My answer: NO.

Diversify Income

A paycheck, from a full-time job is relatively secure. It’s not completely secure, which is good to understand, since you can lose your job or whatnot. But I would never recommend trading a secure form of income for one as tumultuous and uncertain as Amazon. I don’t think you should ever replace your day job with just Amazon. I still do some music coaching and I make no apologies for have an off-line and off-Amazon income that is solely under my control. It is a good strategy for risk diversification. I also make money from mentoring as well as the podcast. Even though these are very closely linked to Amazon, they are not the same thing. I also have some property. If you want to give up your paycheck for Amazon, make sure you have other sources of income.

At the very least, you will need to have an income source to pay for inventory. Even if it only costs you $1 per widget, you still need to have enough inventory to cover sales, if you are doing private label. An alternative is retail arbitrage, which was exclusively covered in my mastermind group. Also, if you want access to exclusive content like that, join the London Mastermind.

This may sound like doom and gloom, but I don’t think it is. You have to understand that Amazon is an amazing place to grow your capital, but it can’t be a swift replacement of your income. I don’t think Amazon should be the sole replacement of your income.

Risk Management

Once you understand the risk of your Amazon business, rather than burying your head in the sand, you can mitigate risk. You can increase your reward while reducing your risk. With Amazon, what are the biggest risks?

Account Suspension

Therefore take care of things that can affect your account. You have to play within the rules. Years ago, some of use sellers pushed the rules quite hard and Amazon gave us a slap on the wrist. Now, they are suspending accounts. For example, if you are using incentivised reviews, take care not to look like you’re buying reviews. Another example is Amazon’s crazy policy around “defect” rate. What Amazon rates as defects are too many returns, refunds, or 1 star feedbacks. Once you’re suspended, it is a long and difficult process to regain access to your account.

I was facing an issue recently in regards to the feedback rating. Long story short, the buyer had left a product review under feedback rather than an actual review. This was an account that didn’t have much in the way of sales and only had 58 reviews. Since there were so few feedback reviews, that was a high rate of 1 star feedbacks and Amazon did not like that and I got a message saying account at risk.

What Can You Do?

For me, it was simple. The buyer had left a product review as a feedback which goes against Amazon’s policies, so we were able to get it squared away. What that told me was that I need to be more cautious about how I get feedback. Not as a way to increase reward, but as a way to reduce risk. Like an insurance policy, it’s not very sexy, but you will be happy you have it if you ever need it.

What I started doing is having a follow-up sequence in my email asking for feedback. A lot of which will be product review which I will ask them to do a traditional product review. This also encourages feedback from customers, more so than you would get otherwise. Which is a great way to improve your service, but also, you can then ask them to submit that as feedback on Amazon. This will allow you to build up a cushion of positive feedback and help you take care of issue away from Amazon. This way, if you ever have a 1 star feedback, not product review, you will have a large amount of positive feedback to outweigh the negative.

Recap

  • Recognize that you are dealing with a high-risk, high-reward way of making money
  • Diversify your income sources so you’re not ruined if something happens with Amazon
  • Once you recognize your risk, mitigate and reduce them while keeping your rewards

There is a lot here, too much to go into great detail. If you are serious about getting started, I recommend getting into the mastermind and really exploring these opportunities.

127 Why Email is Killing Your Amazon Business

Today, I want to talk to you about focus and your use of your time. Everyone in this business seems to go through this same things: overwhelm. I did a whole series on this that you can find here:

  1. #73 Overcoming Amazon Overwhelm – Part 1
  2. #74 Overcoming Amazon Overwhelm – Part 2 – Energy
  3. #75 Prioritising Tasks – Overcoming Amazon Overwhelm Part – 3

However, today I want to talk about the biggest time-suck in your life, which is email. Email is one of those things that seems like a productive use of your time, and if you worked in a corporate environment, or still do, you can relate to this. Email is one of the most common things in everybody’s life. For many people it’s the first thing you do in the morning.  You go through your email with your coffee when you wake up. If this is you, STOP.

Take Control of Your Agenda

If the first thing that you do in the morning is work on emails, whose agenda are you following for your time? Not yours. I’d say it’s being set by the people that have emailed you which could be anyone.

If you think that your boss or your clients won’t be understanding, then maybe, you can prioritise them and only them by filtering your inbox. Though, I’m not entirely convinced that you have to respond to them by 9 am. However, if you do, them schedule a time for that rather than react to the email coming in.

Chances are though, you could get away with answering emails twice a day. 11 am is usually early enough for most emails; then again at 4 pm. If this makes you uncomfortable and you’re worried you may miss something important, put it in your signature. Let them know that you don’t read emails often and offer an alternative way of contacting you if it can’t wait. Let them know that they can contact you on your mobile. Now, don’t put your mobile number in the email. The people that will need to contact you via mobile with have it. You don’t want to get a bunch of random calls throughout your day. That would defeat the purpose.

The purpose is to take control of your time. By limiting your time spent on email and limiting who has access to your attention, you are able to plan your day as you see fit rather than being bombarded by random conversations that make it impossible to focus.

Limit Social Media

Another thing that people do is check Facebook obsessively. Personally, despite have a lot of Facebook friends because of the podcast, I don’t get on Facebook much. Giving credit to Tim Ferriss of the 4-Hour-Workweek, we don’t increase productivity by adding things but rather by removing them.

What this Means for Your Amazon Business

The number one productivity killer is email. If you are letting it take over your life, stop right there. If you are looking for a specific email, say from a supplier, that will help move your business forward, then order your inbox by the “From” field rather than “Date”. That way you can look for a specific person rather than being saturated with all the emails you have received recently.

Another time-trap with email is when you are trying to compose a message to go out. Obviously, you have to go into an email system to do this and then get sucked into your inbox. What I have begun to do is draft the email outside of the system. I will go into notes or notepad and compose it there.

If you are going to be sending similar emails to different people then make sure you are using templates. This does two things. It creates a standardized process so your are simply doing copy, paste, send, rather than typing it up every time. It also keeps you off the email system. So you pull up the template, then dump it into the email system rather than spending too much time in your email.

Don’t Use You Inbox as a To-Do List

Some people use their inbox as a to-do. Their messages are a list of task to be done. If that’s you, don’t feel bad, we’ve all been there. Instead, make a separate list. During your scheduled email time, make a list of what needs to be done. Use the previous day’s emails to create your to-do list for today.

Take Control

Schedule time to check your email and never make it the first thing you do. Have your own set of priorities that you need to work on that will move your business forward.

I have one space left if you are looking for a mentor and are serious about building a business. Go to http://amazingfba.com/mentoring if you’re interested.

1

125 How KLT Can Win You Customers Again and Again…

Today I am bringing you another episode on marketing fundamentals: KLT. Know, Like, Trust. Once again, this isn’t a mindset for you, but that of your consumer which is really important to understand. Stepping back, the most important thing to understand is what marketing means. Marketing isn’t about creating a widget and figuring out how to sell a lot of it. It may look like that, but marketing is really understanding markets. Simply put, supply and demand.

Understanding Markets

If you start by understanding the markets, and find what people are looking for, then create a product that fulfills that need, that it truly smart marketing. To take a pre-existing product, and then try to sell it is much more primitive and difficult to do.

Last episode, we talked about message to market match. If you are the only person selling red dog bowls, even though a lot of people are selling dog bowls, you win. The caveat to that is credibility. I gave the example of trying to sell the world’s best dog food to cat owners and how you won’t find success with that.

Now, imagine you have that same dog food in a room full of dog owners, except that you are trying to give this amazing dog food away for free. That puts the questions in people’s minds. Why in the world would someone be willing to give away this great product for free? How can this dog food do everything it claims?

KLT: Know, Like, Trust

There is a simple marketing principle of KLT. Know. Like. Trust. These are the elements we need to have in place before people will buy from you. Amazon puts a spin on this that you should be aware of.

Know

If people have never heard of you then it’s going to be harder to get people to buy from you. This is difficult to do when you only have a listing to do this with. If you are the only person selling a red dog bowl, it’s less important. However, you won’t likely remain the only one. If there is any sort of competition, you will need to work on your brand marketing off Amazon. You will need to have a website. You need a social media presence and you will want to get YouTube videos up.

Like

The next step is getting people to like your product. It is possible to accomplish this entirely on Amazon. You must have great looking pictures and amazing packaging. No longer can you get away with putting dreadful products on Amazon and sell it. You really must make sure that you have a good quality product.

Trust

The last element is trust. If you’re going to sell dog food, and make some big claim that it’s going to make your dog live five years longer, then you need to back that up. Be careful on how to try to backup these claims. Amazon supplement sellers were leveraging the trust people had in Dr. Oz after he claimed vitamin c serum was the next big miracle drug. Soon these sellers started getting cease and desist letters from his lawyers. If you’re going to reference an expert, be sure you have their permission to do so. A long-term strategy might involve referencing celebrities and big names in your industry and paying them for permission to use them.

Using this Principle on Amazon

Let’s bring it back to the simplest stick: how to I make my listing more likely to convert? KLT. The know part is a long-term strategy. If you are around for a long time, keep showing up in Amazon results, dominate a niche, then you gradually become known to people and they start searching for your brand name. That is when you know that you’re starting to build a brand. When you’re sticking in people’s minds to the point they search you out specifically.

To get people to like you, you have to have a remarkable product. Since you, likely, aren’t well-known, your images and packaging have to look simply stunning.

Trust is much harder to build, but you are leveraging Amazon’s trust. Which isn’t the same as your consumers trusting you or your brand. If it’s on Amazon, and it has good reviews, you are leveraging the trust generated by other consumers in their reviews, and the general trust people have in the Amazon platform.

This principle of marketing is harder to implement on Amazon, but it is vital to understand it you are wanting to build a business and if you are planning to sell that business. The more of a brand value it has, the more differentiation it has from any rivals, the greater multiples you can get when you go to sell. That could be the difference between selling your business for 2x your profits versus 3x. This is when you get the payoff for all the hard work you put in now.

Long-Term Strategy

I want to emphasize that this is not an instant win situation. You will get quick wins with higher conversion, the real payout shows itself long-term with a strong independent business. There are plenty of tricks you can use to circumvent the system, but Amazon is quick to fix that and then you are left with nothing. What I am teaching you today is a tried and true marketing principle that has stood the test of time.

If you are serious about moving your business forward, there are still spaces left for the December meeting of the Amazing FBA mastermind in London. In January I will be expanding to include a high-level mastermind for those that are serious about creating a strong business.

1 2 3 6