Last week I did a webinar with Veeqo (cool company btw) about some of the more advanced tips to improving rankings and generating more sales through Amazon. They had about 300 sign ups with about 80 attentees for the webinar so this was a relatively large audience, all of whom make over $1,000,000 a year in revenue through Amazon. As a result outlining the basics of Amazon marketing wasn’t really going to be relevant so instead I created a presentation that went pretty in depth into how to scale your business. I could write exactly what was talked about in the presentation but instead I wanted to just embed the webinar itself. If you have an Ecommerce business with more than 1 sales and marketing channel (Ecom store, local store, Shopify, Amazon, Ebay etc) then I would recommend checking out the Veeqo software!
Hey, so last month we looked at episode 1 and the current position of the business. Honestly there was not much going on in April, we hit about £2,400 in sales which is slightly lower than we would have liked but we didn’t invest any capital into the business so took home about £800 ready for the next launch. In episode 2 we are going to look at April’s results, again this was just a consolidation month and one where we are researching a lot of products. 2 have now almost sold out but have been purchased and are on-route to their respective Amazon fulfilment centres.
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Results for April
April was a pretty quiet month as previously mentioned. Nothing much going on but still some nice sales. Remember this is a passive business, we spend less than 4-5 hours a week on this business. The majority of the time input comes from product research and launching a new product when they arrive, which is hopefully during the end of May. This is where a high amount of capital goes too.
Instead of the broad product data I thought it would be a good idea to break everything down per product. This is for my own personal tracking reasons too. So currently we have 3 products, all stats are below:
- Revenue: £740
- PPC spend: £23
- Profit: £345.
- Revenue: £35
- PPC spend: £5
- Profit: £15
- Revenue: £1,475
- PPC spend: £28
- Refunds: £175
- Profit: £445.
Goals for next/This month (May):
- Re-launch product WRA. Increase sales velocity + Test a launch service.
- LTD company confirmation with Amazon (This is ongoing).
- Launch product 4 BEL (This includes product purchase, production and shipping)
The main aspect slowing the business is capital, and the second product. Our launch strategy is better for each product and once we have 5-7 products fully launched with our new strategy we should hit that £10k revenue mark…. Then we have to register for VAT and lose all our profits…..
I thought it would be interesting to run a case study talking about how to launch a successful Amazon business. Although I do a lot of marketing for Amazon SEO clients, I also own and operate my own Amazon businesses. These are very young and the one we will be tracking over the coming months is just over a year old. Making its first sale in January 2016. Although it is a year old it only has 3 products live. This is obviously not many for an Amz business and the main reason is down to time spent developing new products. Obviously we only want the top quality products for our seller account and hence growth has been slow.
Over the next months & years I want to run a case study on this business, talking about how we are going to take it from it’s current position to over £10,000 per month in sales. This is only revenue remember and not profit, but I think this is a figure most people can relate to and hence is one we will use currently.
I don’t want to reveal the business itself and the products we sell for threat of competition but I will talk about specific figures, number of products, marketing techniques, financials, Amazon PPC and how I generate reviews, sales and everything that goes into this type of business. So to start you need to get an idea of where this business is at.
This business is in an industry that improves in sales from November-February (as most Amazon businesses do) so as a result the March month sales are slightly down from Xmas & Jan time but this is just to get an idea. So let’s get started. Below is a screenshot of the March sales. Although we have 3 products they are all in the same category.
You can also see the “same date range one year ago” but ignore that data for now. There are a couple of other metrics we want to track. Most importantly is going to be refunds, units returned & refund rate. So we have 1 product that gets a high-ish refund rate. But for the purpose of this case study we will track everything together.
- March sales: £2,932.73
- Refund rate: 9.36%
- Refund No of Units: 16.00
- Refund £ Amount: £364.
- Gross: £2,565.
This is going to be the basic data that we will be looking to increase/reduce over the coming months. Obviously we will be looking to increase our sales as much as possible, whilst at the same time launching new products and looking to reduce the refund rate of that product.
Goals for next month:
Our goals for April are simple, we want to re-stock a product (STA), Improve conversions of product 2 (WRA) and begin progress of launching a new product (BEL). Obviously this is going to take time and I do not see much difference occuring in the weeks between this and April’s report as there is another goal that needs sorting that I’ve heard is very painful to set-up and this is changing from an individual sole trader seller on Amazon to a Ltd company. Here in the UK you are either a sole trader or a Ltd company, there are a lot more legal requirements when you are a Ltd company but there are also a few additional benefits, such as being separated from your business (legally) and also only paying 20% tax on profits, which when you earn over about £45,000 per year in the UK is very important as otherwise you pay a higher rate of 45% on everything above that!
So the goals for the next month:
- Sort Ltd company information out with Amazon.
- Complete samples of new product + Small 20 unit launch order + begin launch.
- Complete samples of product 3 (LEG) + Calculate costs for order.
- Begin shipping of 1000 unit order (STA)
- £3,000 in sales.
I hope you enjoyed the first post, ideally I’ll also start making videos to go along with this post but as I want to keep the identity of the company in question private this might be an issue. But I will be posting new updates on the 8/9th of each month and I hope you come along with me on my journey to £10,000 in sales.
About 6 Months ago Amazon really started to crack down on fake reviews. They sued sellers that were implementing this technique and they then banned the incentivised reviews that came after. This was the process that some sellers used that involved giving away products for free in return for a review. This worked very well for a number of months and was the next step for sellers, but nowadays since Amazon has banned this process the question becomes:
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What Do We Do Now That Incentivised Reviews and Purchasing Reviews Have Been Banned?
And that’s what I hope to cover today, as well as why Amazon can’t really track them.
So first up everything in this article is against Amazon’s T&Cs so if you want to go exactly by the book then this post isn’t for you.
The Obvious Method
Family, co-workers, friends and other trusted individuals – This is easily my favourite way to generate reviews for 2 reasons. 1.) They don’t tell on you, there is no way they will go to Amazon and say “I was paid to purchase this product” and hence there is a lot of trust there. 2.) They can in fact be “paid” outside of a discount. Amazon has cracked down on discounted reviews. Even sales that are 20% discounted where the individual leaves a review are seen as dodgy nowadays! That means that you can’t really offer discounts in return for reviews anymore. BUT if you send the money to an individual outside of Amazon, of even just state you”ll help them out later down the line, that’s the best way to do it. E.G. Send money for the product through a PayPal or just buy someone a beer next time you see them.
This technique works amazingly well if BOTH are Amazon sellers, as both parties know the process and will be happy to purchase each other’s product as a result.
Why It Can’t Be Tracked
Amazon has “banned” these types of reviews. But in essence there is no way they can be tracked. If all IP addresses come from the same city then this might be a slight red flag, but assuming you have friends and families who have had Amazon accounts for years, in different locations all over the UK and the ONLY similarity is that they know you… You think Amazon knows that? Or even cares? The answer is obviously no and as a result this canned be traced or tracked.
One element you should remember is the IP address of individuals that purchase multiple products and review them. If this becomes too obvious that they are only purchasing these products from 1 company and reviewing 5 stars everytime then that’s going to be a red flag and might get your account looked at. But just be careful keep your reviewers spread out and ensure they never tell Amazon it was a paid review! If you want more ideas and techniques check out our site or the full how to launch an Amazon business guide. Thanks for reading.
Starting an Amazon business isn’t easy. There are multiple moving parts and unlike starting a normal Ecom or physical premise business, you are doing all of this inside another person’s business. This means if there are any issues it might not be your fault. We’ve had orders lost, refunds taken from fraudulent accounts and who knows what else gone wrong by what is meant to be one of the most efficient companie in the world. It’s strange to think about Amazon making your business more difficult but the truth is unless you get very lucky they are going to mess your account up in some way or another.
The good news is that when it goes right, it’s a hugely streamlined business model. Marketing and launching a product ONCE to profit for months and years to come, with the only aspect you have to worry about is your stock. This is of course assuming you have a great product and don’t forget to re-supply Amazon’s warehouse or have any issues inside of that.
In this post I’m going to talk about what you should do when you aren’t quite to the above level. You are still ranking on page 2-5 for your products, you have some sales, you have some reviews but you just can’t push that sales rank up and hence you feel stuck with the products you have. This along with a variation of other techniques is what we implement but today I’m going to talk about the biggest edge you can give your business.
Amazon’s Sales Rank
Products inside of Amazon are ranked (organically in their search engine) on how many sales (and the $ figure of those sales) you make. So if you sell a lot of products on a daily basis (more than the competition) generally speaking you will out-rank them. This makes sense when you take a step back and think about the algorthym from Amazon’s point of view. They are going to rank products higher that make THEM (AMAZON) more money. And they make money from the fee structure inside FBA. Hence, more sales = higher rankings. And if you didn’t already know higher rankings = More sales! The problem is this also works in reverse as we mentioned in our monster starter guide for Amazon businesses.
How to overcome this?
The strategy to overcome this is actually very simple – You simply generate more sales than the competition above you. If you are on page 2 making 2 sales per day. Then get to 3 sales per day and you should rank on page 1. Get to 5 sales a day and you should rank on the top half of page 1 and 10 sales a day should per you in the top 5. Obviously this is simply an example but you get my point. The more sales you make, the more money you make Amazon, the higher you rank.
Obviously simply saying “generate more sales” isn’t a sufficient solution to the majority of businesses. Everyone wants to make more sales but its more about “how” can we do this. So below are some ideas that we personally use.
- Family & Friends – Strictly speaking this is against Amazon’s T&Cs but I have no idea why. Officially speaking you are not meant to ask your family and friends to review your product for you. This is crazy and if done correctly isn’t traceable. So if you have calculated how many daily sales you need to reach to get to page 1 (let’s say 10 for this example) and you currently generate 2 per day, this means you have to find 8 from somewhere – Family and friends can give you those 8 daily. Of course it depends on how many contacts you have and whether they are willing to do this but generally people like helping others, and if they get a “free” product out of it then they are also more likely to go ahead. NOTE: No discounts should be applied to the retail price of the product. This used to be a common practice to generate more reviews, but since Amazon has banned this practice (and we’ve tested this and it isn’t even effective anyway.) Plus you don’t want to get sued by Amazon!
- Influencer Outreach – This is one I seriously like nowadays. If you don’t know already influencer outreach involves looking for individuals who already have a relevant following in your niche or industry. For example let’s say we sell fitness products, we should be looking for fitness bloggers, youtubers, writers and anyone who has a large and most importantly active following. We then simply reach out to them and ask them if they would like to review/paid review our product. Prices can vary from $50 to half a million based on how many followers the individual has. But you want to find someone who is not only loyal but also doesn’t promote much (or make it obvious) For Amazon this works better for very small influencers with around 1,000-10,000 subs. The cost will be lower to you and these individuals are usually less corporate about it as well.
- Amazon PPC – You should be doing this anyway but if you aren’t for some reason then make sure you put your budget up to $500 a day and sort your Acos out. There is no reason why you can’t be making money from an Amazon sponsored products campaign and at the same time? Your improving your sales rank and hence organic rankings!
- List Building / Buying – Purchasing someone/another company’s list that you can email and generate sales as a result. This is more of an advanced technique but can work even better if you have your own list/facebook profile/twitter or generally already have an audience that will respond when you launch a new product.
- Social Media Ads – Finally a relatively obvious idea. Simply place your Amazon link inside Facebook Ads platform and start targeting individuals who are likely to purchase. This is a lot more difficult than Amazon’s PPC editor but it should generate some sales and hence allow you to get to the 10 sales a day you need.
Remember: Once you get to page 1 you will be generating natural sales through Amazon, this means you can begin to reduce the amount you spend (especially if it is at a loss) on other marketing channels.
Thanks for reading and remember to share if you enjoyed.