Why should I build a brand for a private label product on Amazon?

That is such a great question. Why indeed? Surely building a brand for a private label product on Amazon is just a waste of time and money and really, who is going to remember to search Amazon for “Sassy Sara’s Kitchen Gadgets” when next they need a can opener?

Let’s say your customer bought your brand of garlic press and it came in the color they requested, on the day they expected it, it was the right price and the quality was great. You followed up with them, they may or may not have had an issue or a question for you, but overall, their experience with your your brand was a positive one. They use the garlic press all the time, and over time your company name or, even better, your logo, which you had put on the garlic press, has gradually, subliminally made its way into their subconscious.

Fast forward a few months and the same customer is searching for a can opener. Sure they didn’t search Sassy Sara’s can openers but they see pages of can openers, all about the same. But one brand jumps out, the one they recognize – your brand. However, your branded can opener is a little bit more expensive than the other brands.

So does the customer take the plunge with an “unknown” brand to save a buck or two or does he decide that the Sassy Sara’s garlic press has been such great quality, that they’d be safer paying a few extra bucks and going with yours?

Well, we all react differently to this kind of scenario. But you get the point.

Have you ever heard anyone say that it costs a lot more to sell to a new customer than it does to sell to an existing customer? If you have not studied marketing then that may be a new concept for you. It is however, the reason so many of us spend a great deal of money building a brand. Once you have confidence in a brand, chances are you will buy that brand again.

You had an iPhone, you liked it and so you bought another one down the track. It didn’t cost Apple anything really to get you to make the second purchase, but before you made the decision to purchase the first time, they had spent millions on you!

Selling on Amazon is a risky business at the best of times. You have to punt your product into the abyss that is the Amazon marketplace without any real knowledge as to whether your product will sell. And if it does sell, what are the chances that there will be profits to show at the end of the year? How will you fight off the inevitable hijackers, the copycats, the returns, the random changes to TOS, how will you own the buy-box 100% of the time?

Well, spending the extra money on creating a branded product, is definitely one way, and one important aspect of this business you really do need to be prepared for, especially as being brand registered has so many benefits.

The only alternative is that you buy something from China that the numbers tell you does sell and put it, unbranded, next to the others on the page. But what will make the customer click on yours when there’s a nice-looking one next to it with an appealing logo or a brand they recognize?

Sure there is price (a race to the bottom is a very bad idea – I explain more fully here) and there is also social proof – reviews and Facebook likes etc. Again, that goes a lot better for a branded product than a no-name product.

Brands are all about perception.

But what of building your brand off Amazon? All successful brands have an off-Amazon sales channel. That is next to impossible to do without a brand. And of course, you can’t get brand registered on Amazon without a brand, so there’s another reason right there.

But I think when you ask this question, you are asking a much broader question. You are asking if there is any sense in spending the huge amounts of time and money it takes to be successful and to build a long term, sustainable online business – via Amazon.

And that is a great question and one that each and every Amazon seller has to ask themselves at some point. Does all the hype about people making $10k per day sound like you? Have you got what it takes to make this really happen? Read this blog post if you need to explore this question further.

When you download your Google Analytics and you see that in the top 5 most searched for keywords searched to bring people to your site is your very own brand name (as is the case with my brands – I have several), then you know that you have done something right. So I do know a thing or two about building a brand (just FYI). Same applies to my products on Amazon btw so I don’t pay for PPC anymore. People just search for my product by brand and the search results – whether on Google or on Amazon – are all my brand products.

So yes, building a brand is absolutely beneficial, but it is costly and it takes time, knowledge and dedication to the task – plus a real understanding of the marketing process. So do lots of reading and learn as much as you can.

I hope some of the other articles on The Ten Percent Club can go some way to providing some of the education you need.

I don’t receive any money for providing this info – I just write it all up to help out.

How to Find the Right Keywords

If you are selling online, then keywords are your ticket to success. If you don’t know how to find the right keywords for your product, then you will almost definitely fail!

Finding keywords on Amazon is pretty simple and many people offer podcasts and software to find out what keywords your competitors are using. You can google that and find a huge number of them.

Be warned if you do that and you have also followed everyone else during your quest to find a product to sell on Amazon, that you will also be following them down the same rabbit hole to potentially find the same keywords!

I prefer to do my own research. I still use an Amazon auto campaign in the beginning and see if Amazon can point me to the keywords that it thinks will convert best. Sometimes that doesn’t work though, it hasn’t always worked for me.

I prefer to use Google. Here’s how:

Type the words into the Google search bar that you would use to find your product, note down the auto complete options you get and go through each one.

Look down the bottom of the page at the suggestions “Searches related to…” and note them down. Do a google search on each and every one of those, repeating the same process of checking what comes in the auto complete and what comes up at the bottom in related searches.

If you are not in the USA and you are looking for keywords to sell on Amazon.com, then click on the Advanced Search button in Settings and change the country to USA.

Do the same in Yahoo.

The other important tool is the Google Keyword Tool. This tool will help you to find a very comprehensive list of keywords for your product or service. It will also give you the number of times each keyword is used in a search each month. That’s vital information that should be used when you are researching into a product or market to potentially sell online.

Next, in order to convert the traffic you bring to your store or your listing you need to be sure you are paying good money to bring buyers – not tire kickers!

There is a huge difference between the keywords buyers use and the keywords browsers use:

When someone is browsing for information and not in buying mode, you will find they use totally different keywords and the trick for you is not to rely on those browsing keywords to bring people to your store (or your listing on Amazon).

Here’s an example:

I want to do some renovations to my outdoor area and when it’s done I will need new furniture so I google “outdoor furniture” “white plastic outdoor furniture” “teak outdoor furniture” to get some ideas. I visit dozens of websites without any intention of buying, I’m just browsing.

Some months later the renovation is complete and now I want some outdoor furniture and I want it delivered asap. So now that I’ve decided I want teak furniture I now google “suppliers of teak outdoor furniture in my town” or “best price teak outdoor furniture” or “buy teak outdoor furniture online”.

Now you see those keywords all have buying signals in them (in bold). THOSE are the keywords you want to put money on!

Long tail keywords:

One and two word keywords like “furniture” and “teak furniture” and “outdoor setting” are all costly keywords as they are so broad that they fit a multitude of situations. Someone could be googling “how to make an outdoor setting” and if you have that keyword set to broad match then you will get all the people who want to make one, or who google “second hand outdoor setting for sale”, or “how to get a stain out of my teak outdoor setting”.

Setting your keywords to a few words on broad match will bring hundreds of people to your store or your listing who are not interested in buying your product.

Not all traffic is good traffic! There is a double-edged sword to high non-converting traffic. If you are constantly bringing people to your site or your listing for the wrong reasons and they leave as soon as they get there having realized that’s not what they wanted, Google penalizes you and so does Amazon. This is known as the bounce rate. A high bounce rate is not good!

Enter the long tail keyword:

Long tail keywords are used to narrow down your traffic to those people who are looking for your specific solution or product. Long tail keywords are long strings of keywords with more than three and preferably more than four words. You can have as many words in the string as you like. Just as long as you can confirm that people are using those phrases to find your exact product. Be sure to use as many buying signals as you can find (in your Google research as I outlined above) in your long tail keywords.

So in our outdoor furniture example, “where to buy teak outdoor setting in my town”, “cheap price for teak chairs”, “best quality teak outdoor furniture”. All of these are long tail keywords with buying signals in them.

If you follow this advice you may find your traffic drops off quite a lot but your conversion rate will rise. It really pays to do a lot of research on your specific keywords. Amazon allows you to add in your own keyword search terms for your product via Seller Central, so you can make sure that your long tail keywords and your buying signals are all included there.

If you have an independent website, then be sure to put all the long tail keywords and buying signals in your website copy. This is just good search engine optimization (SEO) practice.

Amazon traffic fluctuations:

Every day we see Amazon sellers asking “no sales today, anyone else having the same problem?” This is a newbie question really. Anyone who has been selling online or on Amazon for any length of time will know that traffic and sales fluctuate all the time.

But if you are seeing a drop in sales that is concerning, then there are a few things you should check.

The first thing to do is to check your session numbers. Session numbers in Amazon is the measure of traffic to your listing. Look at Reports>Detail Page Sales and Traffic by ASIN. Check your traffic numbers against a recent month when sales were higher and try to work out if the lower sales is due to lower traffic (sessions) or lower conversions (unit session percentage). Try to aim to have a unit session percentage of over 30%. If it is really low, say under 10%, then you may be bringing people to your listing who are not ready to buy. Or, worse still, your listing is not great (title, description, images etc).

If it’s a traffic issue then work on your keywords as explained above. If it’s a conversion issue then you need to optimize your listing.

Setting Up The Business Side of An Online Business

While it is true that setting up an online business can be done in an afternoon and that is certainly part of the attraction, there are still some official steps you can’t avoid.

There are obviously vastly different types of online businesses ranging from affiliates who earn money by “selling” space on their blogs and websites through to businesses of all shapes and sizes offering goods and services. Determining how you are going to collect the money will dictate how you should set up the legal and financial side of your online business.

Registering with one of the leading payment processor companies such as PayPal or Stripe is a simple way to get going quickly. Both charge you a fee for every transaction as well as a percentage of sales as well as a monthly fee.

Payment processors allow you to sell and collect money on your website. They facilitate this for you by accepting the funds from your customers, on your behalf, directly as they checkout. Once their processing costs have been deducted from the funds collected, you can log into your account and withdraw those funds by transferring them to your bank account. You can also usually set up an automatic direct daily/weekly/monthly payment.

And so, if you are going to be earning money this way then you will need to ensure that you have considered the various regulations that apply in your country.

Following are some of the main considerations.

How will you be trading? It would pay to get some advice on this decision. Setting up a company is costly and in many cases not really necessary. It is also something you can do at a later stage.

But if you are going into this business with a business partner then I would strongly recommend that you get advice on the best way to structure the business because in so many cases, it’s the structure that lets a partnership down when and if the wheels fall off.

For a sole trader and a small business, just getting started is a challenge and setting up a company may not be necessary for some time. After you get some advice you may find that setting up as a sole trader is the cheapest way to get started and you can set up something more substantial when you find you are earning some decent cash.

But please be warned, no matter which kind of business you are planning to set up, attempting to do so without going through the appropriate authorities can land you in all sorts of trouble down the track.

Do not set up an online business hoping to avoid declaring income to either the welfare or the tax authorities or to any other the appropriate governing authorities.

Registration with the relevant authorities

Every country has its own authority governing the conduct of its businesses. You must find out what is required in your particular country. In the US you could start with the Small Business Association website (www.sba.gov) and find out which federal and state bodies you need to be registered with and which permits and licences you require.

In Australia, the Australian Government website (www.business.gov.au) provides information on registration for an Australian Business Number and in the UK you will find everything you need to know on www.uk.gov.

Before you go any further you must do this step. You must find out what is required in your country in terms of registration, permits and licences. Some of these official steps can take time so get them underway as early as you can.

Tax: It is worth getting advice on this step from someone who knows your local tax requirements. Your accountant or financial adviser should be able to advise you here.

It is important to ensure you get this right from the start.

If you have a sales tax in your country you will need to know if you need to charge sales tax on the goods or services you are planning to sell.

There are strict penalties for someone who doesn’t pay their taxes so don’t get this wrong!

With respect to product registration, compliance and approval, you will need to ensure you check which authorities you will need to approach.

The following is by no means comprehensive. There are literally hundreds of these authorities all over the world. Check the requirements in your country, but please don’t ignore this step. The fines and penalties can be huge and always remember, in Australia at least, ignorance of the law is not a defense!

For importing or manufacturing food items, cosmetics and health products and supplements you will need to check with the US Food and Drug Administration (FDA) the Therapeutic Goods Administration in Australia (TGA), National Industrial Chemicals Notification and Assessment Scheme in Australia (NICNAS). If you are importing electronic goods you will need local certification for example in Australia you need SAA Approval. You will also need to know and understand your local customs, trade and tariff requirements.

Business bank account

Any online business by definition must be able to take money via an online interface and for that you must have an appropriate bank account. At this point it would be wise to call your bank and find out what their requirements are to allow you to accept payments online. Unfortunately depending on your bank, this may not be a simple step.

In Australia, the NAB is the only Australian bank that will allow you to set up an international bank account. There are plenty of international banks operating in Australia and in every country that will set up international accounts. So it would pay to do your research on this before you set up your business bank account, especially if you are planning on accepting a currency other than your local currency.

Of course, you could just start off small and open up a business bank account with your current bank, accepting your local currency only and expand later.

When setting up a business bank account you will probably have to show your business name registration documents so be sure to have done that first.

How To Receive The Money You Make On Amazon

For those of us who sell on Amazon, the initial set up can be quite daunting. One important question to answer is how are you going to receive the money you make on Amazon.

Amazon.com offers all its sellers the ability to receive funds in their own currency in their own local bank account. So first up, that will get you started.

But that’s not the smartest way, in my humble opinion. You are much better off trying to keep your US Dollars (USD) in USD and not letting Amazon.com convert the dollars into your local currency.

When they transfer your earnings (usually each two weeks) they convert the USD you have earned into your local currency and then deposit into your local bank account.

You don’t have to be Einstein to figure out that Amazon will be making on the currency exchange, not you!

There are a number of options for keeping your earnings in USD if you earn them on Amazon.com.

Set up an account with World First or Payoneer. I will only mention WF from here on as that’s the one I know well.

The first thing to do is to call WF (www.worldfirst.com) and find out what steps you need to take to set up a US currency account with them. It is a very easy process and they hold your hand every step of the way.

You do not need to be a US citizen nor have a US company to set up one of these accounts. Anyone can do it. You are basically becoming a customer of World First by “parking” your money in their USD account until you are ready to move it some place else.

Once your account is set up all you need to do is change the account you want your Amazon earnings transferred to, to be the WF account.

I then have an international bank account which I set up with my local bank in Australia (NAB) which allows me to hold and transact funds in USD. Once my funds build up in my WF account, I transfer them to my local international USD account and then I use that account to purchase anything I need to buy in USD.

In this way, I never have to deal with currency fluctuations associated with my Amazon earnings.

If you are transferring funds from USD in your WF account to another account in USD (same currency transfer) then there is a fee you have to pay to WF. But since you can decide when to transfer the funds, you would build up the funds in the WF account and only transfer funds out when there is a good amount there.

Try to transfer in greater than $10,000 lots so that the fee (of about $100) is a very small percentage.

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How To Choose Your Amazon Product

So you have decided to launch into selling online and the world of private labelling (PL) but you are stuck, and have no idea how to choose your Amazon product, right?

There is so much conflicting information out there and if you are a member of a Facebook group you mostly get newbies telling you which way to go and what to do. Some of the advice comes from successful sellers who themselves, don’t even know how they found their successful product, or who perhaps stumbled on a great product and for whom there was a huge element of luck involved.

Many sellers who were successful at the start quickly find dozens of new sellers following the same how-to-find-a-product instructions, not surprisingly ending up at the same point and launching the same product! Suddenly page one of a previously underrepresented keyword is crowded with other PL sellers. What happens next is everyone starts dropping their price to compete (a very bad idea and here’s a post about pricing strategy) and the opportunity for selling that product, is over before it really begins.

So it is absolutely crucial if you are going to be one of the ten percent of online businesses that succeed, that you get the product right.

If you google the question, “how to choose your Amazon product” you get dozens of well-meaning bloggers and sellers of Amazon tools and plugins who tell you to start looking on Amazon at the best seller lists and/or choose something you are passionate about.

Another common piece of advice is to walk around your house or office and look at everything you use each day. Does anything stand out that you buy or use regularly, or that evokes some passion in you.

But in the end, the overall goal is to find something that is already selling on Amazon, find a supplier on Alibaba, slap your own private label on it and join the other sellers.

You can do all of those things but most of the advice provided, misses out on telling you…

The number one vital and most important thing you need to know when you choose your Amazon product:

FIND A NEED

If you are ready to start your product research then let me repeat: the single most important piece of advice you will hear today:

DON’T FIND A PRODUCT, FIND A NEED.

There is absolutely NO POINT selling something on Amazon that no one needs. This is the number one reason so many hundreds of new sellers on Amazon are failing. It seems like such common sense that if no one needs what you are selling, then they won’t buy it – but ninety percent of new sellers don’t hear this from anyone and have absolutely no idea that they are launching a doomed product.

Please, whatever you do, do not look on Amazon to find a product – look on Amazon and everywhere else for that matter, to find a need. A need that is currently not being met or fulfilled or not being fulfilled satisfactorily.

There is a reason most smart people spend years waiting for the right business idea to come to fruition, they know they don’t want to waste their time and money on a flop! Unfortunately, Amazon offers a very low barrier to entry, so anyone can do it. This means that those very new to business and with little business know-how can launch a new business with a laptop and a couple hundred dollars.

It makes sense then, that a low barrier to entry would be equal to a low barrier to exit. Or to put it another way, a low barrier to entry is equal to a high failure rate.

So in the Amazon world and the world of e-commerce what is a NEED?

Without going into the psychology of need (but if you are interested, google Maslow’s Hierarchy of Needs), we know that human beings have a number of basic needs.

The desire to have our needs met leads to the motivation to find a solution.

NEED = SHOPPING

Not rocket science.

If the motivation to find a solution is strong enough, then human beings will search and continue searching until they find the product or service that fulfills the need.

So if you want to have a business that provides a product that is available on Amazon.com then it makes sense to look for products that meet certain needs, preferably largely unmet needs, that people have.

A good place to start is with your own needs, the needs of your family members and potentially your friends.

Rather than the aspiration to start a business selling products on Amazon, I suggest you start with the aspiration to find a need that you can potentially fulfill with a product. Is there something you do every day that annoys you? A product that continually breaks, continually fails to fulfill its intended purpose? Something that you find frustrating every day?

One thing that frustrates me every time I cook is the oven mitts and pot holders that are currently available. And yet, silicone oven mitts are synonymous with the iPhone cover – that is, products that too many people have tried to launch on Amazon and a market that is absolutely saturated. But as far as I can see, they are all pretty much the same.

For me however, the oven mitt solutions available on the market today do not meet my needs. Not that I am suggesting you get into that market (because it is absolutely saturated) nor am I interested in getting into it myself, but I mention it because whenever I think of my own daily frustrations I always think of the oven mitts and pot holders I own – they are all rubbish!

I am not going to go into why they are no good for me, nor what should be done about it – because I absolutely do not want you to go and find yet another oven mitt and launch it on Amazon. But it is a shining example of an unmet need that I have. However in this case, a product NOT to launch on Amazon.

So the second vital step in selecting your product, once you find your unmet need, is to do a tonne of research. What else is out there, how is this need currently being met, are the products adequate, do they need to be adjusted or remade completely differently to meet this need you have identified?

I can’t emphasize enough that you need to spend a lot of time doing your research. Is this a need you have that no one else has (like my oven mitt example).

The best option would be to find something that needs to be completely redesigned to meet the most common needs. Yes, this is much more expensive than buying something on Alibaba and slapping on a logo, but much more likely to be successful!

The next step, once you have found your unmet need and with an idea in mind as to how you could solve it, is to determine how large the potential market might be.

I have elaborated here on how to determine your market size.

To further illustrate my point, let’s look at a common product that I see being sold by new entrepreneurs and which fails almost every time. The t-shirt. Please tell me why anyone would think that they should open up a new online store selling t-shirts??

Who needs a t-shirt? Well, most of us do and we need them often and in a variety of colors and shapes, designs, sizes and price points. But they are available EVERYWHERE in a variety of colors, shapes, designs, sizes and price points. There is absolutely NO UNMET NEED as far as I can see and just about every single new seller of t-shirts goes out of business or never even gets off the ground.

Perhaps now you can see why.

[Caveat: I will write another post about wants. Some people of course, just want something and it makes no real sense, they just want it. For you to create a product that people want and will pay good money for, is another level of marketing skill altogether.]

There are times when a “me-too” product can work and you can read about that in this article which provides further information to consider when finding the right product to sell.

So in summary, spend your days and your nights looking for an unmet need, then research the products available and determine how they are not meeting the need, next, figure out how you could potentially meet the need with a product and then determine the size of the need (ie the market size).

If all those boxes can be ticked, you may just be onto something.

The Number One Mistake New Online Businesses Make

Ninety percent of new online businesses fail. So what is the number one mistake new online businesses make?

Australia is one of the highest innovation-driven economies in the world with a score of 13.1 percent of Total early-stage Entrepreneurial Activity (TEA), according to Global Entrepreneurship Monitor’s 2014 Global Report.

So what is it about the tantalising lure of the global economy that attracts so many individuals, young and old, to launch a business that in a pre-internet economy they would never have considered?

Perhaps it’s just that is looks so easy, but given that ninety percent of them are destined to fail, the statistics speak for themselves. In fact, it is not so easy after all.

Every morning I take some time out to read an online forum where the members are all new online business owners. I do my small bit to help where I can. Here is a selection of the topics posted today:

“Why are my sales so low?”

“Launched 3 months ago and no traffic, please help”?

“2 Sales in the 6-8 months I have been here, is it time to quit, help please”

“ Active for 6+ months … approximately 2900 visitors… 0 sales”

“Any ideas to what I am doing wrong?”

“4,000 visitors and no sales, any ideas?”

There are probably at least twenty new online store owners per day asking questions just like these.

I try to find the time to go and look at some of them and give them some feedback. But the problem is usually the same for each and every one of these failing stores.

Never before has it been so easy and so cheap to start an online business. All you need is a laptop and something to sell and you are off and running in an afternoon.

Problem is, it just isn’t that simple, as these thousands of poor souls are finding out the hard way. Most of them have invested something in stock and possibly in the store platform. All of them have invested a lot of time, even if they haven’t given up their day job (a very, very wise decision).

Almost all of these failing businesses have made some classic and completely avoidable mistakes. Avoidable, because what they needed to know is common knowledge for anyone who has been in business for any length of time, or anyone who does some reading and research.

The Number One Mistake New Online Businesses Make

But the number one mistake new online businesses make is that they are not selling anything that is unique. There are literally thousands of stores online selling jewellery, t-shirts, men’s and women’s fashion and new ones are opening up every day. Almost without exception, these businesses are failing in droves.

I gather many think that their hand-made jewellery or “designer” fashion is unique, when in fact that is most definitely not the case.

In order to cut through the clutter and qualify for the sale, an online store has to offer something that the buyer can’t, or believes he can’t, get anywhere else. The buyer has to be compelled to hand over their cash. They have to believe their money is safe, they have to believe the store is run by a professional. I read one home page today that says “this is my new venture that I have achieved with the grateful help of my family and friends…” The lack of professionalism hits you straight between the eyes.

In addition to building scarcity and trust, every new business has to have a compelling story. The About Us page is a good place to start. But realistically if there is no story, and the products are largely the same as everyone else is offering, then why waste your time?

Having a compelling unique selling proposition (USP) is obviously crucial, yet I see hundreds of new stores with absolutely no USP, nothing to differentiate them from their competitors. No back story, nothing that builds trust, nothing to compel me to buy.

And that’s before we even begin to critique the lack of quality images, checkout procedures, shipping information, returns process etc.

What none of these new business owners have understood is that starting a business involves a lot of hard work BEFORE the idea is even ready to be considered for an online business.

Just having access to some wholesale t-shirts, or having a talent for turning twisted metal and gems into jewellery is NOT a reason to start up an online business.

Here’s a quick checklist:

Have you identified a need?
Is your idea unique or largely unique?
When you talk about your offering in a few sentences to your friends do they largely say “I want that!” or “I know heaps of people who need this!”
Can you articulate your USP and key differentiators?
Have you conducted a substantial amount of online research, sampling your competitor’s offerings, asking potential customers what their pain points are, testing your solution on them.
Have you seriously considered the financial fundamentals beginning with your pricing strategy? Being the cheapest is just a race to the bottom that no one wins. Being too expensive is sure way to kill sales.
Can you identify your target market and quantify your audience?
Do the numbers stack up?

If, after all these steps have been undertaken and if, and only if, the results are looking positive, then I would suggest you go the next step which is to begin putting together your business plan.

There are literally hundreds of steps involved before starting any new business.

If you want to be one of the ten percent of online businesses that succeed you will need to at least start with this checklist.

Oh, and a bit of luck wouldn’t go astray. Believe it or not, I do think that there is an element of luck in every successful business.

So happy researching and good luck!

How to Start Selling on Amazon – Do You Have What it Takes?

I am a serial entrepreneur having started my first business when I was in my twenties and now almost thirty years later, am able to say I have never drawn a salary from someone else in all that time.

Three years ago I started a new product business centred around my passion for helping others. I saw a need and I saw pain in others which I postulated I could solve if only I could come up with a product that would do the job.

I spent about a year researching the market, looking at other products that were available, buying them all and trying them out. I made countless notes of what was good about them and what was not so good. I created a gap analysis and once I’d figured out what the gaps were, I tried to work out how I could fill those gaps.

I created a quick and dirty ad and put it up on google and sent people to a landing page that I created with a free website builder to drive people to a short 5 question survey, which I also created with free survey software. I asked them what they wanted and that also gave me an opportunity to not only get to know the potential market and their pain points but I was also able to gauge interest in my idea by measuring the click through rate (CTR) on my ads. I was able to test out some keywords and determine if there really was a market for my idea.

Then once tested, I went into searching for a manufacturer, developing the product and eventually landing a couple of pallets of my own product! A very exciting day indeed.

I launched my first website and had my first sale within the first day. I knew then and there that I had a winner. I have gone on to expand the product range and the countries into which I sell.

I stumbled on Amazon as I was looking for the best way to sell my product in the US. In my country, Amazon is just a book seller so it took a bit of research to discover what Amazon had to offer in the US.

I launched on Amazon.com about eighteen months ago, and got my first sale almost straight away. Again, I knew I had the right market, the right channel to market and the right product at the right time.

Why am I telling you all this?

Because I am saddened to see so many would-be entrepreneurs on Facebook who have been led to believe that this business is a paint-by-numbers business and who are unwittingly buying into the dream.

They are being encouraged to download the podcasts, do the training, sometimes paying exorbitant prices, sometimes free. Follow the steps in the exact order in which they are laid out, and then voila! Before you know it you’ll be leaving the Dilbert cube and on your way to freedom. All it takes is the guts to take the plunge, and the rest is up to the process which you painstakingly follow.

Well, while it is true that some of these trainers have some great ideas and have certainly provided some people with the instruction manual to make a potential living out of this, the vast majority are not making a living – or even close. Not because the process manual is wrong necessarily, but because it is only half the story.

There is SO MUCH MORE to this business than what is able to be communicated via a training manual.

Those that succeed have either stumbled on a whiff of Lady Luck or they are extremely talented, smart, budding entrepreneurs who would have succeeded in any business venture they put their mind to.

But is that you, or are you one of those posting questions like:

“I have decided this is going to be my future, what ideas do you have to give me, any help would be much appreciated”.

“I am trying to find my first product and finding it really difficult. Can anyone take a look at this chart and tell me what you think?”

“What does it mean, ‘verified’ reviews?”

“With all these changes on Amazon, how is someone new going to be able to launch a new product?”

“I launched my product on Amazon a month ago and have spent $200 on PPC and still no sales, does anyone know why?”

“Three months ago I opened my shop on Shopify and I have not had any sales. Can you please look at my shop and provide me with some ideas?”

These are all great questions, but not the questions someone imminently planning to go into business should be asking. If you don’t know how to turn on the post notifications in Facebook so you can follow the responses to other people’s questions and posts, then I am not the only one who thinks you are possibly not the person to succeed in PL selling on Amazon.com.

I know I probably sound harsh to some of you, but I intend to be. I want to stop the vast majority of you from losing money, I want to stop you from giving away your hard earned dollars to a world you don’t understand.

And before all the grumblers get on my case and say “you can’t swim unless you dive in the water” and “ just do it” and “don’t listen to all the negative talk” and “you can do it, just take action” etc, etc, blah, blah…

That is all just so unfair to be letting people believe that!

If you are one of those who lucked onto a product and you are netting $50k a month and working three hours a day and languishing on a beach somewhere, then I’m really happy for you. But you represent about 1% of all those who try.

If you are one of the hard workers who worked seriously hard to find the right product, followed your passion and learned everything there is to learn the hard way, failed a few times and got back up, exercised patience, lost sleep, and kept on going, then you represent about 10% of all those who try. An you are the guys who would have succeeded at anything you put your mind to – with or without the training manuals.

But if you are one of these and you are encouraging others to follow in your footsteps and “give it a go, why not?” then you are not, in my humble opinion, doing anyone any favors.

And you are failing to recognize your own unusually high level of skill and intelligence which makes you one of the 10 percent success stories. It is not kind to be perpetuating this idea that you only have to take the leap and anything can be achieved.

For those of you who are considering starting this journey, let me ask you this one question: Do you believe you can do this without the training manuals and without the step-by-step podcasts? If your answer is yes, then congratulations – advance to the next stage and start the journey. By all means download the podcasts and learn everything you can while doing your own due-diligence. Depart from the paint-by-numbers instructions as often as you can and make your own way in this.

As a side note: Like many successful PL sellers before me, I started my Amazon journey without any training manuals or step-by-step instructions and I never once gave away product in return for a review because I didn’t believe in the ethics of it. But I’m killing my competitors who have thousands of reviews. Most of my products have less than 20 genuine organic reviews provided by customers who felt like leaving one.

But I digress.

If you answered a definite no to my question above, then please reconsider. You are not going to find everything it takes to make this journey a success if you intend to rely on the instruction manuals and podcasts alone. It just isn’t possible.

Apart from tenacity, intelligence, patience and perseverance, you need money – and quite a bit of it – and you need to understand the marketing process. You need to understand supply and demand, the unique selling proposition, pricing strategies, needs and gap analyses – and even if you don’t know what these mean, you need to instinctively be able to discover these answers along the way.

I have been so saddened by the posts of those who have not been able to grasp this business and who have lost their hard earned money.

This is not meant to be the doomsday chronicles but just a reasoned alternative point of view that may help prevent some of you becoming the next statistic.

Amazon.com has made some huge changes of late aimed at slowing down the number of new PL sellers getting in their way. There must be millions of products sitting in Amazon’s FCs costing them money, and we know Bezos is not accustomed to spending a dime he doesn’t want to. So if he sees new inexperienced PL sellers costing him money, you can bet your bottom dollar he will continue to slow you down or run you out. He will reward the high turnover sellers and constrain the newbies.

So please take heed and do not jump into the Amazon.com business unless you are sure you can become one of the ten percent.

2 thoughts on “How to Start Selling on Amazon – Do You Have What it Takes?”

Tony says:

December 30, 2016 at 3:47 am

Great post. Very straight-forward and honest, not like someone selling an ebook or DIY course.

Thanks.
1. thetenpercentclub says:
  
  December 30, 2016 at 4:22 am
  
  Hi Tony, thanks. You are right – not selling anything! Just offering advice from my years of doing this kind of thing.

Comments are closed.

Amazon Sellers Advice: Beware the checkbox of death

Last weekend I lost 75% of my Amazon stock to one guy who took advantage of my ignorance and wiped me out. He now has, in his possession, hundreds of items that belonged to my business and he paid absolutely nothing for them.

My Amazon listing is now out of stock in five of the best selling variations since he was careful to only take the best sellers.

I am writing this because I want to warn all the other new sellers out there that this can happen, so it doesn’t happen to you.

I am a bit frustrated I have to admit, that I have spent at least 40 hours a week over the past few months, on top of time spent on my other businesses, reading everything available about how to manage a successful business on Amazon, yet I had never heard of the checkbox of death until it was too late.

So, what is the checkbox of death? It is an option which is checked by default in Seller Central, that ensures any promotion codes you create are posted publicly on your Amazon listing. That way, anyone who goes to your product listing can see the code they need to put in at checkout to take advantage of the promotion. Sounds reasonable.

Problem is, all the “how to sell on Amazon” advice out there tells you that you have to get as many reviews as you can, as fast as you can, to be successful. The current advice is to give product away in return for reviews, because, among other reasons, amazon allows this, provided the reviewer declares they received the product for free in return for their honest and unbiased review.

All good so far. Except the only way to give product away on Amazon is to provide the reviewers with free promotion codes. And, yes, unless you know about unchecking the box that unhelpfully says “detail page display text”, the code goes public and the outcome is potentially shattering.

But the unfortunate thing for a newbie is this, what the hell does that mean? What is a detail page and what is the display text? No explanation is given, no little question mark offering some explanation as to what this means. And since the box is checked by default, any newbie (who is in a hurry and trying to juggle 10 things at once, like me) is going to assume that one should leave it that way. I would certainly not check a box I didn’t understand, but equally I wouldn’t uncheck a box I didn’t understand.

Usability testing 101 Amazon. That box would do no harm if it was left up to the user to decide whether to check it or not. Worst that could happen to someone setting up a promotion where the code needed to be public, would be they would realize it’s not visible on their listing and they could go put it in. A much less devastating outcome than the way it is designed at the moment.

This one checkbox is apparently the source of many, many sellers being in my shoes. It has apparently sent many sellers to the wall. This is so common that it has been dubbed the checkbox of death.

Before I go on, and lest I don’t do this warning properly, there’s another checkbox that you need to know about too, the one that says “one redemption per customer”. At least this one is pretty obvious. If you don’t check this box and you give a code to a reviewer, he can give it to anyone else and they – and potentially hundreds of others, can use it too. At least the description of that one makes perfect sense, but I thought I’d mention it as apparently it’s also the reason many sellers have been wiped out.

Anyhow, back to the story. The weekend for me was devastating as I tried valiantly to save my stock as it was running out the door and down the drain. Firstly, I rang Amazon within one hour of the first 90 items being bought and asked them for some help. I couldn’t see that this person had used a promotion code, it looked like they were legitimately buying the stock, which I knew was a sign something was wrong. No one needs 90 garlic presses, let alone at full price!

The person I spoke to never alerted me to the potential folly of the checkbox, nor did she ask me if I had recently set up a promotion. She told me that she could see that all the sales were to one person, she also assured me Amazon protects their sellers and that I need not worry, if the sales turned out to be a problem, Amazon would reimburse me. She must have said at least three times, don’t worry about it, everything will be ok.

So I didn’t worry. Then 12 hours later there was another run on my stock, again I rang Amazon, again they were not much help. This is when I turned to this Facebook group of Amazon sellers and was alerted to the checkbox of death. I checked my promotion, found the issue, turned off the promotion (which takes four hours to take effect), and then watched helplessly on as the rest of my stock was wiped out.

The next 48 hours was spent trying to get Amazon to cancel the orders. This is not an easy task because, although I was wiped out, all is good for Amazon. They supposedly have one very happy customer, and that’s what they are all about, happy customers.

I opened a few support cases with different titles and each time they read the case they closed it by forwarding it onto a “specialist team”. Each time they did that, I reopened the case and provided a phone number for someone to call (this was all happening outside normal business hours at Amazon, so there was no phone support). They closed, I reopened until finally someone called me!

Once I explained, they were somewhat helpful, but by now it was all too late. Most of the orders had gone out, and my stock was gone.

To add insult to injury as they say, I still don’t know what effect having my stock out there being controlled by someone who doesn’t understand it and didn’t pay for it, will have on my business in the US. Potentially even more damage to my business yet to come.

However, after I got over the devastation to my business and the feeling of being violated, by Tuesday I was back on the horse and had sent another shipment of stock to Amazon.

I’m largely an optimistic person and I do generally look for the silver lining. For me there were several positive outcomes, yes, truly there is.

With the sudden run on my products, the all-important Amazon sales rank metric has gone through the roof. That means that the Amazon algorithm thinks my product is hundreds of times more popular than it thought it was before the weekend, which has increased sales to the remaining stock and will positively impact sales when my stock is back. (This is one reason for sending more stock over as quickly as I could – might as well make the most of it, right?)

Second, I discovered that The Amazing Seller Facebook group was a remarkable group of supportive and caring people, which restores one’s faith in humans.

And third, I decided to tell my story so that I could help as many of you as I can. I hope that hundreds of Amazon newbie sellers read this so it doesn’t happen to them.

I am also very grateful for something else, which I hope is a lesson for others, and that is that I didn’t have all my eggs in the Amazon basket. I have several ecommerce sites which bring in sales from at least 12 other countries. I am currently building a structure of resellers and distribution networks and warehouses all around the world, and sales are still strong everywhere else.

While this temporarily wiped out my Amazon business, it didn’t wipe out my business as a whole. Don’t put all your eggs in one basket, spread your risk!

So here’s my other piece of advice: never give up and don’t let the buggers get you down

How To Name Your New Product or Business – Part II

Once you have your business or product name, the next item on the list is to register the name.

Register Your Product and Business Name

This page follows on from How To Name Your New Product or Business – Part I

It is very important that your business or product name is clear, descriptive and memorable.

If it is a business you are working on launching (e.g. an online service) then make sure you register your business name with the appropriate authorities in your country. Every country has its own requirements for this step so you will have to go online and research what is required.

There are many reasons to register the business name including compliance and tax but above all you want to ensure that you can use that business name in your country. Most countries won’t allow you to register a name that is the same or substantially the same as another business in the same or a similar market.

If you are registering a business called McDonalds Bookkeeping and there isn’t another bookkeeping company with that exact name then you will probably be granted registration. But if you want to name your business McDonalds Hamburgers you may not!

Sometimes this is another opportunity to put a THE in front of the name you want if it isn’t approved as you originally requested it.

Don’t skip this step because above all you want to know that you are protected from someone else registering your name and you later finding you have to change your name.

If it is a product you are creating then you absolutely must register your trade mark (see below).

Buy your domain name

Once you have made your decision on a name, you absolutely must buy the domain name if you can.

When you buy the name you will be asked if you want one, two or five year’s registration.

Here are some of the considerations:

The more years you buy the cheaper it is per year
Google makes decisions about how authentic an online business is based on many criteria, one of which, is length of time of domain name ownership, having said that, Google changes its algorithms frequently and that may not always be a consideration
Consider buying several versions of the one domain. For example if the dot com is available as well as your country’s domain for the same name then perhaps you consider buying both – more as protection from someone else owning your domain name in your local market, than the need to have two domain names to manage.
If you have another market in mind (for example a country you are planning to launch in the future), such as the UK market, you may consider buying the .co.uk version of your domain name for a year if it is available
Make sure that the email address you use when registering your domain name is your most permanent email address because domain name registrations come up for renewal every year or two (depending on what you select). You will want to make sure you are contactable when your domain name requires renewal.

You may also be asked if you want a private registration which means that if someone wants to know who owns your domain name they can’t look that up on the public domain. I have never bothered with private registration, but it may be important to you.

Long names and hyphens

As the internet gets older and more domain names get registered, there appears to be a tendency to create extremely long domain names. I would avoid this if you can. Although there is a lot of clicking that goes on to get to your website, so perhaps you are not concerned about people having to type in your domain name, there are many times when you will have to write out your domain name and a long name is a huge issue when it needs to be written down.

This is especially evident in your advertising. On Facebook, on brochures, business cards, online advertising just about anywhere you intend to advertise your product, you will be writing “Buy online at www.abcdefgh.com” If the URL is really long that will always be problematic for you.

In the early days of the internet there was a tendency to put hyphens into domain names. That was mainly due to people not being aware that a string of letters would or could spell out several different words. So instead of having a domain name that was unitedtravelinsurance.com it would have been united-travel-insurance.com

But the internet and its billions of users have matured now and we know that there are often several words in there and we know to look for them.

So what’s wrong with a hyphen? It is mostly problematic when you are saying a domain name out loud. Imagine yourself having a conversation with a potential customer and you have to say blah hyphen blah dot com. Rather than blahblah dot com. Much easier to remember and as I say, no real need for the hyphen these days.

Unfortunately like many things to do with the online world, there is an exception to this and that is when someone is trying to own a particular keyword or group of keywords in organic search. In this instance they will want to own all the variations of a specific keyword or long tail keyword.

This is a very common strategy utilized by members of affiliate advertising programs who want to own every derivative and variation of a common search term.

Trademark your product/brand names

While it is important to register your business name and your domain name there is one final very important step. You must trademark your name.

The trademark is usually a visual registration that encompasses the name, the logo design, its colours and its industry/use.

This is to prevent anyone else from having a similar name business doing the same thing as you in your geography or industry. The last thing you want to happen is for you to find your hard earned dollars are promoting someone else’s business.

Worse still, that you can’t own your own name because it was never available in the first place.

Registering a trademark can cost a bit of money but it is an absolute must.

Patents

This leads to the consideration of patents. This really goes beyond the scope of this book, but I wanted to make sure that it was mentioned so that, should you have invented something unique for your business, that you will take the time to get some advice on the application of a patent.

Patents can be very costly and so it isn’t something you would go into lightly, but if you have indeed something to protect, the protection will be far less costly than losing your idea to someone else down the track.

The Business Plan Template

At the very least, take the time to fill out the business plan template provided on this blog. I have made sure that the most vital elements are covered. But please note, if you are planning at any stage to apply for finance or seek an investor then you will need to complete a more comprehensive business plan.

The business plan template provided with on this blog covers the minimum. Should you require a more comprehensive version, there are plenty on Google.

How To Name Your New Product or Business – Part I

You many not think that naming your company or product is all that important, but of course any marketing professional will tell you otherwise.

Please don’t give your company its name by using your initials and please don’t call your product a name that no one can pronounce or spell. You would be wise to take some advice on the name game.

Here’s a start:

How to name your new product or business

This step is worth spending a lot of time on – I always do. No matter what your business is going to be, whether it’s a product or a service, you will be building a brand and that brand begins with the name you choose at this vital point in the process.

It can be a daunting process and you may feel that all the good names are taken. But they have not! Get out the dictionary and a large piece of paper and be prepared to try dozens of different ideas and spellings. I would of course, suggest you hire a professional agency for this and if you have the budget, then do that! But many new entrepreneurs just don’t have the budget.

Get family and friends involved. Once you have a few ideas, test them out on other people. I once had a name that I was very 50/50 on, and once I tried it out on others, I was 100% on it. My family and friends were right, it was a raging success!

Since you are going to be selling online you will ideally need to find a name that is available as a domain name. Go to one of the domain name suppliers like Go Daddy (www.godaddy.com) and type your proposed name into their domain name search tool on their home page.

Let’s say you want to name your film business “ScreenGoddess” and you find that the dot com domain is not available, then there are several things you can do:

Add a different extension to your domain for example .com.au or .co.uk or .com.fr and preferably use the extension for the country you will be launching in first.
Add “The” to the beginning and search again for TheScreenGoddess.com
There are new domain name extensions being released all the time, so be sure to check them out too (eg .biz)

Before you opt for a close variation to an existing domain name ensure that you are not in the same business or location as the existing domain name owner. Specifically that you will not be competing for and confusing the same customers.

Own your domain name

I can’t stress enough that owning your domain name (or URL) is vital for an online business. If you aren’t quite ready to launch your business and reading this book at a very early stage, I would suggest if you have a name in mind that you test the domain name availability now and purchase it for just 12 months. That will usually only cost you a few dollars. There would be nothing worse than to come back to this in six months’ time and find that someone else has registered your name.

Be strong in your name resolve. If you find that the absolute ideal name is taken in every single domain you want, then I would suggest you go back to the drawing board. I did that once and I still mourn the name I couldn’t have because someone else had it. I wasn’t even launching a product that would be sold exclusively online, but I was extremely committed to owning the domain name and so I just had to go with my plan B name.

Suggestions on how to find a name and how to brainstorm a name may include using an online thesaurus and typing in some of the words that describe your product and looking for less common terms for the same thing (synonyms).

Keep a piece of paper with you at all times and jot down names as they come to you then research them online later.

Always check on the meaning of words you use in your business name, making sure they are not derogatory or inadvertently offensive in some obscure way.

Look for anagrams, alliteration and spoonerisms. Also look for fun ways of saying something very ordinary and common, for example using a play on words for a cookbook and calling it “Stirring Events” (which by the way, at the time of writing is available as StirringEvents.com, so don’t listen to people when they tell you all the good names are taken).

Just do your best to come up with a name that will work with your USP and preferably has a good domain name available.

Further reading: How to Name Your New Product or Business – Part II