by Karthik Reddy of Webmasters Jury
You may already be a fan of Amazon as a consumer. It’s pretty easy and affordable to get all the things you may want or need.
Or you may already be a business partner with Amazon, which has even more benefits.
In the UK and the US, the number of products sold per month is huge – 390 million and 606 million respectively. That means that the Amazon customers tend to spend quite a lot of money.
Specifically, the average customer spends about $700 each year, while the Kindle owners spend about $1,450 per year.
And out of the 304 million users on Amazon, 30 million of them use the mobile app each month, thanks to Amazon’s mobile app discount.
In case you’re looking to make some money this way, you should know that the top 5 best selling categories on Amazon are:
If you’d like to learn lots more Amazon facts and figures, just take a look at the infographic below.
Getting your Amazon Account Suspended is an ugly business. But when you’re out of options…Amazon lawyer Robert Segall (of Amazon Sellers Lawyer) tells us about one final option:
By: Robert Segall of Amazon Sellers Lawyer
Amazon sellers are essential to the Amazon platform as the e-commerce giant continues to grow towards near monopoly status. Last year Amazon shipped over 2 billion items worldwide on behalf of sellers utilizing the Fulfillment by Amazon service alone. In addition, the company is now estimated to make up more than half of all holiday ecommerce transactions in the United States.
As the platform continues to expand, issues for sellers have become more frequent, and at times, more complex. Getting an Amazon Account Suspended is a top concern for sellers, and getting back to selling is the number one priority in almost every case. When you have exhausted all your options, you may want to consider filing for arbitration; or, in the worlds of ASL founding attorney, CJ Rosenbaum, “take the decision out of Amazon’s hands.”
Pursuant to Amazon’s terms of service, “each party consents that any dispute or claim relating in any way to this Participation Agreement or your use of the Services or Transaction Processing Services will be resolved by binding arbitration as described in this paragraph, rather than in court …”
This means that if after your Amazon Account was Suspended, the typical Plan of Action and appeal process did not get you reinstated, arbitration may be your final option.
Arbitration is similar to going to court, but it is usually less costly and gets faster results. The arbitrator, a neutral third party, may be a retired judge or practicing lawyer. The arbitrator’s decision is final just as if it were given by a judge in court. This means amazon must abide by the decision of the arbitrator according to the law.
The appeal process begins with the seller writing to Seller Performance. The seller must draft a plan of action which details the reason(s) for their suspension and how they have corrected the issue(s) and implemented a plan to prevent them from reoccurring.
Sometimes, a plan of action (or multiple plan submissions) is not enough to persuade Seller Performance to reinstate your account. Sellers are often “shut out” in a sense. Amazon may stop responding altogether, or might just give the seller generic denials.
The next step would be to file an appeal with the Bezos Escalation team, but many times this can be a dead end for sellers as well. If you are getting nowhere with Seller Performance and the Bezos team, you may need to take Amazon to Arbitration to force them to cooperate and provide a substantive response.
Related account issues are difficult because Amazon often mistakenly believes that accounts are linked when in fact they are not. The difficulty is that if your Amazon account was suspended because Amazon believes that two accounts are impermissibly related, they will not provide any reasoning as to why. For example, one performance notification we have seen at ASL provided: “we found that your account is related to anther account that may not be used to sell on the site.
Have you seen this:
Due to the nature of our business, we do not provide details on our investigation methods.”
Another merely states that the Amazon account has been suspended because the seller is operating an account that “may be related to an account that may not be used to sell on the site.”
Amazon regularly refuses to provide the substance of its allegations. Plans of Action are often written in the dark. Sellers often feel that it is impossible to write a Plan of Action because they are wrongly accused and are not provided any indication of the reasoning behind the accusation.
Although Fulfillment by Amazon is an amazing service that provides sellers with a unique opportunity to grow their businesses, it is far from perfect. Lost inventory is something we hear about regularly at Amazon Sellers Lawyer. Lost inventory is lost money. Lost inventory is frustrating issues for sellers because so much is out of their control.
When working with Amazon to recoup or seek reimbursement of your lost inventory there is no estimate for how long it will take. Just like with appeals, Amazon may give generic responses or not respond at all to a sellers attempts to locate their inventory. When inventory is lost, sellers are left with no product to sell. Thus, debts may go unpaid due to lack of sales. When Amazon refuses to cooperate, sellers have no time frame as to when they can get back to selling.
By filing for arbitration in a lost inventory case, you can “take the decision out of Amazon’s hands” and legally bind them to the decision of the arbitrator.
If you’ve had your Amazon account suspended, recouping your inventory is crucial. If your account issues fall into any of the above categories and your appeal process has hit a dead end, arbitration may be your best option to get you’re your inventory back or obtain reimbursement for the lost goods.
By: Robert Segall of Amazon Sellers Lawyer
Amazon Sellers Lawyer is a team comprised of unique individuals with extensive knowledge and backgrounds. They are dedicated to defending the rights of e-commerce entrepreneurs and sellers across all platforms. Founded in 1994 by CJ Rosenbaum, the firm is now emerging as an industry leader as evidenced by its receipt of the Bitbond Best E-commerce Site of 2017 award.
Whether a seller is facing having their Amazon account suspended, an Intellectual Property issue, or their funds are being held, the team at Amazon Sellers Lawyer has the knowledge and experience to serve sellers day and night, all around the World.
It’s no surprise to anyone that sales with Amazon in 2017 will get more complicated. There is more competition. It will probably weed out those that aren’t committed and aren’t willing to invest the time and money needed. It’s going to get more sophisticated. The person just throwing something up on Amazon probably isn’t going to make it. The ones that put in the effort, and work to make sure it’s a good product to sell will excel.
We’re going to need better listings now that there is enhanced brand content. More people will start using that making it more difficult for those who don’t.
Email follow-up sequences will become more important. They’ve always been important, but now that they are the only real way to get reviews, they are that much more important.
Inventory management will become more important. It’s not secret that Amazon’s distribution centers are bursting at the seams. That can’t really hold more products. So we will likely see stricter inventory control. Whether that’s higher storage fees, or they don’t allow to send in shipments on products that they already have a lot of inventory for.
It’s seems obvious hearing that, but I didn’t really think about it. A couple months ago we were trying to ship products to Amazon. We were warned against sending new products until after the holidays. And it’s fantastic that you were able to talk to Amazon lawyers. It’s reassuring to know that JumpSend is sound and don’t have to worry about getting flagged or banned for using it. I’m definitely going to use it with my next launch.
We have Greg Mercer on the show again. You can listen to our previous interview on product research, as well as one on supplier negotiations. Greg studied civil engineering at university and had a corporate job that he hated. He began selling on Amazon as a break from his day job. He managed to quit his day job and just do FBA full-time. He did that for about two years when he was frustrated by trying to find products to add. The best way to scale your Amazon business is by adding more products. Greg didn’t have a lot of capital to throw around so he wanted to find ones. Out of this need, Jungle Scout was born. Now he joins us to help us find the best products to sell on Amazon.
Today, Greg is still selling on Amazon. He has released a few products in the last few months. He’s been working on Jungle Scout, and that has expanded into a quite a tool for Amazon sellers. There is Jungle Scout, which a research tool. Jump Send is a deal site to get you additional sales, as well as a follow-up sequence. Splitly is an AB testing tool for Amazon sellers. Fetcher, which is profit analytics. It calculates what you’re really making after refunds, promos, etc. All the numbers Amazon likes to hide from you.
That’s a common issue. Everyone knows how good of an opportunity Amazon is, but it’s finding products to sell that is a struggle. The best products to sell on Amazon are ones that have existing demand, that means Amazon customers are already searching for it. You want products that have low competition and that have good margins. Those are the main things. Other things you may want to consider are whether they may infringe on any patents, and they don’t need to be licensed. Think of liability; if a person can hurt themselves with it, you may want to steer clear. Lighter, smaller items are generally less complicated. They are easy to ship and you don’t have to worry about oversize storage limits.
Jungle Scout was created to solve that issue, but you can look on the Amazon’s best sellers page. You can get ideas from Pinterest, look at what people pin a lot. You can hang out in big cities where trends start first. Once you do that, make a list of product ideas and go to Amazon. There is actually a free way to find out how well a product sells. You can click on a listing, then look at the best sellers rank under the product description. Then you can go to junglescout.com/estimator. It’s a totally free tool, you don’t even have to put in your email. You put in that sales rank and it will give you an estimated amount of units that product sells on a monthly basis and see what the demand is.
For demand, you want to look for products that are already selling on Amazon. A beginner mistake is that people “know” that a product will do well if it gets on Amazon. A small percentage of the time, that might be true, but more often than not people are wrong. It’s much safer and less risky to go with something that is already selling.
I want to see 2000 units a month, being sold on Amazon. Let’s use a coffee cup as an example. If you search “coffee cup” on Amazon. Then take the top 10 listings, or however many are relevant. Let’s say 8 are selling coffee cups. Then click on each of the listings, get the best sellers rank. This is helpful because it tell us how well this product is selling. This number, by itself, is very difficult to interpret. However, at Jungle Scout, they have come up with an algorithm that can estimate how many units are sold based on that number. It changes on a daily basis and they have a full-time data scientist that is always updating this. So, get that number for each listing, find the units sold on Jungle Scout and add them up. If it’s more than about 2000, then the demand is there.
The first thing is to look out how they drive these algorithms to estimate the sales. Depending on the category, they collect between 200,000 and 500,000 data points every month for that category. This is the relationship between the unit sales and the ranking number for that day. Then they run a regression analysis and they come up with a line of best fit to estimate the sales based on the rank.
The best sellers rank changes on an hourly basis. The way they estimate sales is that if a product continues to sell as well or as poorly as it has for the past few days, this is how many units will sell in a month. If, last week, your product was selling 10 units a day, but this week is selling 1 unit a day, Jungle Scout will estimate based on the 1 unit per day. So you’re sales might be 60 units that month, but Jungle Scout will only estimate 30. It’s the best they can do with the limited data Amazon gives out.
Some people will get on there and see their products are 10% more than Jungle Scout’s estimate and will conclude that you need to add 10%. That’s not true. If you look at the regression analysis, there are some points that run above the line, and some below. They’re taking the average of hundreds of thousands of products in a particular category. So, your 1 product may not fall on that line, but if you average the whole category, it will be on that line.
Exactly. People get caught up, too much, in the tools. Keep in mind this is still just an estimate. You’re using this tool to determine a ballpark range on a product’s sales. Jungle Scout may estimate that a product does 900 units a month. In reality, it might be 800 a month, or 1000 a month, but you know it’s in that range. It helps with forecast and it help determine if there is good demand in there.
This is difficult. One tool that helps is Google Trends. This tool allow you to see how a search term has trended over the years and seasons. This is a fairly good gauge of how items will sell on Amazon. As many people know, Greg has done public case study selling bamboo marshmallow sticks called Jungle Sticks. Based on Google Trends, you can see how the sales have changed based on the seasons. January to February are the slowest times. July and August were the highest times. And if you look at the sales, you can see that matches up. So can look on Google Trends to determine if this is a high season or a low.
The reason I like to use the 2000 or 3000 units, is because people like to answer “It depends”. It’s too arbitrary if you’re a beginner. At the end of the day you’re looking for the item with the biggest spread between demand and competition.
If I was a complete beginner looking to sell my first product on Amazon, I wouldn’t worry about that. That’s more higher level strategy. Focus on getting your first product up on Amazon and learn the rest later.
If you’re already have your products on Amazon, and you’re trying to figure out forecasting, that is a good idea. Two good resources are Google Trends, and Keepa. Keepa has a really nice, free database of how sales rank has trended. A lot of products have two years or so of data. You can look at the and see how the sales rank has trended over the months and seasons. You can try to start estimating how well your product is going to sell.
Some products you can tell by common sense. If you’re selling lawn products, then the summer months are going to be the best. Other products, like the marshmallow sticks, it’s not as clear when they’ll sell well and Google Trends can help with that. If Google Trends shows there is twice as much searching for marshmallow sticks in the summer months, then you know to order a little extra inventory.
Reviews are a great indicator of competition. That’s probably the biggest thing to look at. On top of that, the quality of your competitors listings. If they have a poor listing, like one picture, a really crappy title, than that is someone that would be much easier to outrank. As opposed to someone with a really good listing.
The first thing to look for is how many reviews they have. Older, more mature products that have been selling consistently well, are harder to outrank.One way to tell how mature a product is, is how many reviews it has. An older product that sells well, is going to have more reviews. A product with 1000 reviews is going to be much harder to outrank than one with 15. A rule of thumb is to look for something, where 3 or 4 of the top reviews have under 50 reviews. That signifies that it’s probably a young niche.
One thing to understand is how Amazon ranks the listing. They use keyword relevance. The sales velocity probably makes up about 50% of the algorithm. That would be the number of sales per day. Another factor is the conversion rate of your product. Now the sales velocity and the conversion rate depends on a number of factors. Those including the quality of your pictures, the price, the social proof, the average star rating. If you competing against other listings that have a lower rating, then you’re probably have better conversions and more social proof. People would much rather buy a product with a higher average rating than one with more reviews.
Yeah. Visually, if you have a 4.9 average,Amazon displays 5 stars. But a 4.7, they show 4 and a half stars.
Today I have a simple but powerful marketing principle: Triple M. This isn’t so much about your mindset, but rather about understanding the mindset of the consumer. By that I mean a shopper that has the potential to buy from you. I feel like people don’t truly understand this and therefore there is an opportunity for you on Amazon.
This is key in driving sales and conversions. Let’s unpack this in non-internet terms. This is a fundamental process that applies in any market in any medium whether it’s face-to-face or online or wherever.
If I was in a room full of cat-owners and they hated dogs, I could offer them the best dog food in the world. I could say, “it would make your dog leap for joy and it will make him/her the happiest and healthiest dog and add five years to their lives. It is normally £50 and I will sell it for £3.” How many responses would I get? Zero! Now, if I had a room full of dog owners, the response would be much different. Message to market match is crucial.
Amazon does its best to ensure there is good message to market match because it leads to happier consumers. Happier consumers will like and trust Amazon more and keep coming back.
Keep in mind that we are leveraging people’s trust in Amazon. When someone does a search on Amazon they are saying, “I am looking to buy xxxx.” Amazon then looks at all the listings it has available. Then compares keywords that are in the title and the bullet points. Then determines whether those keywords have helped that product sell, and delivers the best matches to the consumer.
If you are selling dog food, and the shopper puts in the word “cat food”, you have to hope that Amazon does not display your listing. If it does, then it is just a waste of everyone’s time because the cat owner isn’t looking for your product.
You need to be very clear about the market you’re going after. Instead of trying to find keywords that will help you sell a product, you should be thinking of the customer’s search terms, and finding a product that will fulfill that search.
Let’s use “red dog bowl” as an example. Here is a great way to find a niche market where demand is high but the obvious keywords, dog bowl, are hyper-competitive. It would take a lot of work and giveaways to gain any traction. Now, let’s say you search for red dog bowl and the search results show a black dog bowl, and a silver dog bowl, etc.
That means that Amazon couldn’t find an exact match for the terms had to display similar products that aren’t exactly what you’re looking for. That tells me that there is an opportunity. If I am a shopper that is looking, specifically, for a red dog bowl, and my search results come up with one red dog bowl and the rest are different colours, then I will likely click on that one. This will help your click-through rate and this is called dominating a niche market, which is internet marketing 101.
The other thing to think about is when people have gotten on your listing, they are pretty likely to buy. As long as you don’t actively put them off, they are likely to convert. So you will be getting better click-through rates as well as conversion rates. Therefore, if you’re buying Amazon ads then you will be getting a better return on your investment.
Let’s say you’re paying $1 per click for “red dog bowl” and 30% of people that click end up buying, then the cost per sale. Averaged out, will be $3. Whereas, if you were to pay $2 for the keyword “dog bowl” and people click on it, then see several other listings that are very similar and end up clicking on another product. That conversion rate will be much lower. Let’s say the conversion rate is closer to 10%, you are going to end up paying $20 per sale.
You can find a niche market. Also, if you can find a niche market where you can supply the exact thing that people are searching for and no one else is supplying it, you can secure niche dominance and will have very good click-through and conversion rates. This will lead to fantastic sales since there is less competition.
The next stage in message to market match is believably. If you are selling that miracle dog food to a room full of dog owners. This time you’re giving it away for free. That raises the question of whether or not they can trust you. That question, I will answer, in the next episode.
The first way to increase Sales (and thus increase profits) is the best-known way: get more customers.
On Amazon this primarily comes down to the basics of:
Of course, there are many other ways but these are the simplest and most direct.
However, this is only 1 of 3 fundamental strategies, most of which are neglected by most Amazon sellers. Find out what the other two are in the next episodes…
To find out more about the Amazing FBA London Mastermind mentioned in the episode, click here
There are just two ways to increase profit in any business.
You must either increase the sales; or decrease the costs.
It’s that simple. But don’t overlook the power of the simple yet true. This is simplifying thought that is obvious once you think about it – but that makes it all the more vital that you grasp it.
And from that first thought, several other powerful principles follow…read the next episode to find out more…
To find out more about the Amazing FBA London Mastermind mentioned in the episode, click here