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Pat Lum 0:46
The last couple of weeks of November look pretty similar to the first few weeks of December, like November 15. It’s the 30th looks pretty similar to December 1 to 15. But then at some point in mid December, the fire hydrogen gets uncorked and the thing starts, it starts ramping. I would put as much money as you can in to actual product development. And this is coming from marketing companies. That’s just like I don’t, everything gets easier for you. Even if you’re thinking about it purely numerically, like the better product you have. The higher the click through rate is
Welcome everyone to the Firing the Man podcast a show for anyone who wants to be their own boss. If you sit in a cubicle every day and know you were capable of more then join us this show will help you build a business and grow your passive income streams in just a few short hours per day. And now your host serial entrepreneurs David Schomer and Ken Wilson.
- Amazon Kindle Edition
- Clarke, Adam (Author)
- English (Publication Language)
Welcome everyone to the Firing the Man podcast on today’s episode, we are joined by E commerce extraordinaire Pat Lum. Pat is the co founder and president of asteroid X an Amazon partner agency that helps its clients dominate Pay Per Click advertising. Over the past five years, Ken and I have worked with Pat and his team with great results in service. We also consider pat a friend and well respected member of the E commerce community, which is why we are so excited to have him as a guest. Now pat, you are in an elite club, the a two time guest of the Firing the Man podcast. And so for those of you that haven’t tuned in to our listeners haven’t tuned into Pat’s first podcast, which was episode 15. Can you tell us a little bit about yourself? And what led you to founding Astro Dex
Pat Lum 2:30
is an absolute honor gents. Thank you. And so that was 15. And this is 150 is an odd? Yes. So so as I was looking at the math, this is a 10x I’ll see on 1500 Hopefully sooner a minute minimum we’ll do 1500 Yeah, just so thanks. Thanks for having me, guys. It’s awesome to hang out. And yeah, for those who haven’t seen 15 I started as everybody is a regular start to your ecommerce career. I started dancing on the street for change. I was really in high school I took up breakdancing I don’t know if I don’t think I’ve told you guys this before. But yeah, so I was good stuff. Yeah, this is this is all this is new. This is very old, but new at the same time. Yeah, I was a breakdancer in high school and I just wanted to make a few extra bucks. So I my friends and I started dancing on the street. And so within as with any like marketing decision, you start to be like, Okay, where can I get in front of the most number of people most relevant audience and so we’re here in Toronto, Canada, and we chose Yonge and Dundas Square, which is like Times Square. It’s got the same billboards. It’s got like the video billboards and stuff like yeah, we just got annihilated. Absolutely terrible. There, we had three guys dancing, and we made 30 bucks for three hours work. So that’s like $3 An hour or something like that, like it was just horrible. But it was a good lesson because we danced really well but we didn’t engage the audience at all. And people would just walk by the display even though the dance was really good. It wasn’t it wasn’t really about that it was about like the initial engagement and I think that’s where I first sort of fell in love with the art of marketing and just like attention and like commerce in general it was just really interesting. And his back when they had changed too so the coins were just disgusting and Canada since discontinued the pennies but we got a lot of pennies back then it was gross. Yeah. And then we fix it up and eventually work that business up to about 0 a day but our bodies were just getting destroyed dancing on a thin sheet of linoleum on concrete every every week and so we needed to do something with a bit more skill. Another one of our interests was was fashion so we took we took the proceeds and put it into an inventory order like so this was all we could think of to do at the time and I didn’t do any product research we just did what we what we thought was cool it was accessory to keep your pants tapered at the at the bottom of the pant we thought it was interesting idea and and that you know that failed as well to learn to expand, and then we just kept trying products, I went door to door selling products to retail stores. Yeah. And then eventually just just, you know, stumbled on E commerce. Because again, it was it was in search of, I guess, more scale, more sophisticated modes of distribution. So you go literally from the street, which is like a localized, non scalable for distribution to stores, okay, a little bit better, they used to carry the product for you, and then you go online. And so that was sort of my gradual over the course of several years, like progression into into E commerce. And so, you know, I had some experience with crowdfunding, you know, I raised $50,000 on Kickstarter, and 20 days, on one product, it just hit. Because you know, as David will tell you, like, some products will just be hits, and you can’t really explain why just the market just make some hits. But this this one hit for whatever reason, it was touchscreen, leather gloves in the winter on kickstarter.com. It’s a crowdfunding platform and erase $50,000.20 days, I thought that was a genius, and I dropped out of school. I wasn’t a genius. I just, again, I just got lucky. So so but I took took some of that, put it back in inventory. And then and then sort of, you know, Kickstarter was a one time cash infusion, which is a problem because you don’t have predictable revenue every month. So I finally found Amazon got turned on to Amazon sold there. And yeah, and then just really fell in love with the marketing component of Amazon. That was about five, six years ago and ever. That’s what I’ve been focused on ever since. So now we manage about $13 million in ad spend on Amazon every year for hundreds of brands team of over 25, folks, and just having a good time.
That’s awesome. So yeah, definitely bring him back some old school stuff there with the the dancing. I did not know that story. But that’s, that’s, it’s awesome. I love it. Cool. So So Pat, I think we I think we jumped right into it. So last time we had John was probably 2020. Now we’re looking at 2022 of this episode is going to air probably middle of November, right before you know the holiday shopping. And so can you at a high level or in the weeds? Can you share with the audience? What is the landscape look like for for Amazon PPC and 2022? And how has that changed from you know, last year or previous years? Like ache? Are people measuring Aiko? Small? Are they looking at tacos? Like what is what are the things that people should be focusing on?
Pat Lum 7:15
Yeah, when I’m I’m always learning about this stuff all the time, too. It’s constantly evolving. I just I guess what I have to offer here is a weird position where we see hundreds of accounts and all of the data every month. So you can sort of start if you squint, like start to come up with sort of aggregated views of trends. And so I think what we’re seeing in general, is that Amazon’s ad platform is actually growing quite quickly, if you saw the results from from the last sort of year on year from the last quarter Facebook extras on negative growth in terms of its its ad platform, Google pretty large, but stagnant. Amazon grew 18% year on year, and it’s now 14% of the total digital ad spend in the US like it’s becoming a big deal. So with that they’re sort of in there sort of, you know, a few years ago, I think it was very much in its infancy and unsophisticated ad platform that saw pretty limited functionality, but good results, because you know, the cost per click was lower. Now we’re sort of heading into an adolescent phase where you know, the growth is still quite significant. The feature set is a bit more sophisticated in terms of targeting you can do, and they don’t want to slow the growth. So they’re looking for new ad units that they can add to the platform to be like, Okay, it’s not just about sponsored products. It’s also about they’ve added sponsor brands several years ago, they’ve added sponsored display. Now, they’ve added Amazon attribution, where you can advertise and bring in traffic from different platforms, which I will get into. But yeah, it’s just sort of an adolescent albeit fast growing ad platform that’s become a bit more sophisticated in recent years.
Okay. Okay. That’s those growth numbers on the advertising side of things. That is, that’s huge. That’s huge, especially given that if I’m not mistaken, that tell me if it’s correct, the advertising outpaced just the the size of the Amazon platform in terms of like, your FBA fees, your referral fees, kind of that physical inventory business, is that right?
Pat Lum 9:16
Amazon? I don’t know about that. Because I’m so tunnel vision on the ads, but they are very bullish on this department as a company. It’s very high margin revenue for Amazon. And they don’t have any financial incentive to stop building this department. Very much the opposite. Yeah. So it’s very so with, I think they just want to keep up with growth, and they’re going to launch new ad units. With that said, can like to, to your point, what’s actually working, just what we found, and again, this may evolve over time, but just what we found is still the fairly basic ad units are still quite effective, by which I mean sponsored products. So for those folks just That’s if you type in The keyword on the Amazon product appears in search results. That’s sponsored products. And also sponsored brands is like, you know, call it those banner ads and sponsored brand video now, between those two ad units, despite all the other new rollouts, those haven’t really caught fire yet in terms of what’s effective, and what’s working and what’s bringing in revenue and profit. I can talk about what types of sponsored products and sponsored brands but yes, suffice to say, you’ll get, say, 80% of the benefit of the ad platform by using sponsored products and sponsored brands correctly.
- Williams, Kirk (Author)
- English (Publication Language)
- 160 Pages - 10/29/2020 (Publication Date) - ZATOWorks Publishing (Publisher)
Okay. Okay. Very nice. Now, as Ken mentioned, we’ve got q4, right around the corner. And for E commerce sellers, this is our Superbowl, right, we’ve got, you know, between Black Friday and Christmas, this is when a lot of companies are turning a profit are having their highest level of sales. And in we’ve got one shot, right, we’ve got q4 Is is going to, you know, passed by in a blink of an eye. And so we want to play our cards right, as do our listeners this upcoming q4. And so curious, are there any strategies that change as you enter q4, and that could be in terms of increasing or decreasing budgets, that could be focusing on certain ad types? And then also, I’d be curious on when do you taper? When does holiday shopping stop. And you need to taper that spin. So what are your thoughts here?
Pat Lum 11:26
So there’s a saying, which is something like sweat in battle, so you don’t sweat in practice, you don’t bleed in battle, something like that. The gist of it is, you know, get all of your preparation and, and if you haven’t prepared leading up to the big event, like it’s not going to go well, just by virtue of not having prepared earlier. So at the time that we’re releasing this November-ish, there’s still ample time to prepare for December. And I can give like to get specific on what it means to prepare for ads in December. Basically, you want a ton of data, you want a significant data set. If I run an ad for this term, I can reliably put in $1 an ad spend and get $4 $5 back. And I know that for a fact in the sort of offseason or like the season leading up to it. So in November, I know that. So that should be the case in December, the only kind of issue that I see with folks is maybe if they didn’t run a lot of exploratory or data gathering adds in October and November, then they’re less served in December by the time that rolls around. Because December is not the time for exploration and data mining, like you really want to have a set of terms that you know, you can reliably spend behind and that you can scale pretty nicely. And that’s sort of where the benefit comes in. So although December is the shiny object, a lot of the prep is done right now, as we’re releasing this.
Okay, a follow up question to that would be. So for our listeners that have been running ads on here, if you were to get into their account, pre pre download some reports, what would you be looking for in terms of like identifying those winners, those that money machine where you put $1 in and you get five back?
Pat Lum 13:06
Yeah, for sure. So if you’re if you’re in the account right now, and you can follow along, Seller Central follow along, if you’re if you’re in Seller Central head to the advertising console, you’ll see the graph of the sales and the spend and stuff like that, go to the left, head to the reports, download a search term report for sponsored products for the most part, like unless you’re running a lot of elaborate sponsored brands, those are two separate reports, you’ll download the data for sponsored products and sponsored brand separately, the grab the sponsored product ones go as far back as you can, doesn’t let you go back that far. So you want to download this regularly, just as a matter of hygiene. But you’ll take as much data as you can probably 60 days, you’ll download it to your PC, and just sort sort by seven day total sales. So that will give you all the terms that that you know, in descending order of how much they how much revenue they got for you on the ads console, for the last, say, 60 days. And that is really instructive. Like, it looks like a lot, the platform looks complicated. It’s getting increasingly complicated. But these are the basics like, literally just download the report, filter by sales, you’ll see all the stuff that did super well. Now a little caveat here, just because it got you a ton of sales doesn’t mean that it performed in a profitable manner. So maybe you have some main keywords that have a lot of traffic, but for some reason, you’re just you’re not converting at 10% 20% 30%, you’re more converting it, you know, 235 percent and the ecos. In other words, the you know, the amount that you’ve spent, and in proportion of the revenue you got back was not that favorable. So with that stuff, you might want to dial it down, you might want a bit down, and in extreme cases, you might want to negate it. But yeah, for the most part, it’s really just about that social report, download it. And again, so like the 8020 sort of the 20% of actions that produce 80% of the results, run sponsored products and sponsored brands. Download a search report, filter through it, and just analyze right like So on the on the upper sort of half of the search term iceberg, you’ll see all the stuff that worked. But then on the bottom, you’ll also see stuff that that did not work at all in the period. But yet it’s spent money. And that’s your money leaving your pocket. So what I would say is just, you can find the stuff that works and accentuated but the other half of the search term report, the bottom 50%, or like all those terms that spent cash, but didn’t generate any revenue. And with those, it least bid down. It’s not totally negate, right, there becomes a point where it’s just insanity where like, you’re like, I got 50 clicks for this thing, and I didn’t convert anybody like, it must be my product in relation to this keyword. So at a certain point, it’s just statistically unlikely that you’ll get sales for those terms anymore, so it’s fairly safe to shut it off. And that’s how to look at those those spreadsheets. Right? It’s a it’s a big mean spreadsheet looks super complicated, but literally just sort by seven day total sales, take it down and sort of cut it up into the stuff that worked the stuff that didn’t.
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That’s, that’s really cool. I like how you know this basically, going back to the foundation fundamentals, this was what it always comes back to and nothing fancy, there’s always going to be, you know, fancy new add types, like you said, Pat, you know, Amazon, I don’t know exactly what the numbers are. But I do know that advertising is second, I believe it’s the second most profitable division, they have an Amazon next to the cloud. And so it’s an Yeah, it’s obviously probably a lot easier to run their advertising than it is to run the cloud. And so easier, you know, more profitable and easier, they’re gonna scale it and so they’re always gonna be throwing new ad types, oh, there’s this new fancy ad type or there’s this here, test on test them. But like, when it when it when the rubber meets the road, like what David said, we have our Super Bowl coming up in the next six weeks, get you know, go back to basics, find out what’s work and double down on that and just come with a really strong game
Pat Lum 17:46
100% Like, that’s them testing, like, that’s them, something we’ll catch, it might be sponsored display, it might be Amazon posts, it might be Amazon attribution, but at the sort of at the long tail side of things, those are all relatively new experiments. But we’re here to help folks make money. So you can’t really you can’t hinge on those experiments in order to make more you can test them absolutely. But at the same time, like the bulk of the like, that’s why it’s a little bit like I didn’t want to come on and talk about fancy ad groups and stuff like that, because that stuff doesn’t, you know, in large part, that’s not what’s gonna pay the market trade like you got, you go back to it and look at the reports and mostly run sponsored products and sponsored brands to is become a significant part of the revenue. But even if I had to reduce it further, it’s just sponsored products, mainly auto campaigns that, like, I’ll tell you something else. Like, this is just a weird thing that we’ve noticed, I wish this wasn’t true. But this just happens to be true based on the data that we have, like, like autumn Amazon’s advertising algorithm, for whatever reason, they love auto campaigns that have a ton of products put into it, we call them catch balls. And you can, it’s not like you have to break the bank here, you can do like really low bids, like lower than suggested bids with a bunch of products in it inside of an auto campaign. And Amazon just really likes, this just really likes that for whatever reason, I wish it didn’t, but it does. So that is something that you can take care of, you can basket your products a little bit alike, so you have like a bunch of tennis stuff, and then a bunch of rock climbing stuff and like, like you can catch, catch all like that. But like if you put a good number of child skews into each one, and because we tried both like we’ve tried like because for the advertiser if you’re advertising like you you wish that you could have a campaign with a hyper targeted product and a hyper targeted set of keywords and you can do that and it’s sort of like the sharp tip of a pencil but just again if we’re just talking revenue and profit Amazon seems to love these catch all campaigns maybe it’s because it’s a more of a blank check license suspend maybe it’s because of some other algorithmic sort of nuance that nobody knows but like that’s really sort of actionable thing that that you could do in advance of q4 to ramp sales up.
Yeah, that’s that’s really cool. And yeah, I wonder if it’s just, you’re on like a blank check. cuz like, we’re kind of like dumping everything in a bucket and saying, Here you go Amazon Go sell this stuff. And I guess as long as you know, like, you know, you can really refine auto campaigns more nowadays. And you could, you know, a few several years ago. And so yeah, I mean, that’s cool, though, to hear that, you know, you have a lot of visibility into hundreds of accounts, and that this is a strategy that’s working. Well, that’s interesting. So listeners take note of that. And again, I
Pat Lum 20:25
wish it wasn’t true. But it’s, there’s there’s a basketball player who he’d like he did free throws with the granny throw, like, yeah, the arm throw, and they were like criticizing him for it’s like, why are you doing that? That’s dumb. It looks stupid. It might look stupid, in the same way that I’m saying like, hey, launch auto campaigns with a bunch of products in it. Like, that’s literally the underhand throw, right? It’s but but yeah, it’s Yeah, I don’t know. I don’t know why, again, I wish it didn’t work. But it does.
Yeah, no, I’ve heard about that guy. And I saw some clips on him. I can’t remember what his what his percentage was. But it was really high as high as percentage of making those was really high no matter how, like what you thought of it, you know? Yeah, that’s awesome. So, so you, you had mentioned Pat, like in the business of making people money. And so on that note, there’s a little bit more of a an advanced question like, or just would really like to hear your thoughts on that. And strategy. Every year, David and I, so David is pretty amazing at finding trends and analysis on in spreadsheets, right? And so, like, hey, check a look at this. And so we’ve noticed, obviously, over the last several years, that like around Christmas day, you know, sales and in everything tanks, right, and so, and we’ve noticed that it’s between five and seven days. And so what is your take in terms of like making money? Do you recommend people kind of just shutting all of your ads down and just because you’re not gonna they’re not gonna be profitable? Like what? What is your advice there?
Pat Lum 21:49
Okay, okay. Yes. Okay. I’ll yeah, I love the question. You asked something similar to this before, actually. And I think we never got to it but like the so every, it has a rhythm. And it’s same rhythm every year. So like, I’m always shocked by the lack of sort of shopping activities for October and November. And it’s always slower than you think you’re like, why isn’t it here? Like, why isn’t he here yet. So you go through that like kind of, sort of sad sort of trudge along phase. And then at some point in and again later in December than I think, usually because people, there’s so many last minute shoppers and so much last minute job activity going on, that somewhere like the last couple of weeks of November look pretty similar to the first few weeks of December, like November 15 to 30th looks pretty similar to December 1 to 15th. But then at some point in mid December, the fire hydrant just gets uncorked and the thing starts, it starts ramping, right. So you’re like, Oh, my goodness, like this is pretty wild. And it goes, you know, Amazon would would like to push it later. And later each year, right, their fulfillment networks are getting stronger and stronger. So the date at which the fire hydrant shuts off is getting later and later every year, I’ve noticed if not even by like 12 hours a year. So like, Amazon will want to go until the until the bell sounds until the very last package that could make it in order like to be under the tree, like so that’s like December 22 23rd, they’re still sliding some things under the door. And then yes, to your point, there’s, there’s a, there’s a silence between, you know, Christmas and New Year’s. And then as a bonus, if you’re in supplements or fitness that you’ll see a January spike because of all the new year’s resolutions. Like if you’re not in those areas, then you know, it’s gonna be pretty quiet. But like, yeah, so So spiking December until the last allowable moment where shipping and logistics allows it. And then yeah, so in terms of what how to adjust budgets to align with this stuff, it’s kind of like you’re gonna, you’re gonna go on a gentle ramp of budget increases, like the most important thing is, as long as the spend is profitable. Again, I will emphasize that as long as it’s profitable spending and make sense, and never will go budget effectively, Amazon’s budgets reset most of the time in PST, so that because they’re in Seattle HQ, so you’ll want to stay up, or have someone on the team stay up until, you know, midnight Pacific Time to make sure that none of the budgets run out. If they do, you should decrease them, again, as long as the spend is profitable. And then as you’re gonna do that all the way up, and that is very sensitive, like days in December in the 20s, December 20 to 25th. And then what you’re gonna want to do is probably not not shut off, because you don’t wanna lose any ranking or what have you. But you, you really want to take a lot of the budgets down because you would have ramped them up a lot to accommodate a lot of the holiday spending and then you’re gonna want to cap them quite significantly in the days following December, you know, whatever 23rd 24th through, there’s a little spike of sort of like, oh, shoot, I did. I didn’t get her what she wanted. So I’m going to go by this but that’s, that’s not a significant it’s very real, but it’s not significant spike, but there was there some do overs and some makeup gifts that I saw last year to
catch up give somebody forgot or So like Yeah, exactly
Pat Lum 25:00
the catch it the weird uncle that you don’t see stuff like that, like, you know, offense. Okay. I’m sure it’s cool
right now. Yeah, that makes sense. So essentially whatever kind of budgets let’s say like early December or maybe even mid November kind of watch whatever you are normally running at, you want to kind of ramp back down to in that like December 24 25th ranches keep an eye on that
- Vallaeys, Frederick (Author)
- English (Publication Language)
- 262 Pages - 01/14/2022 (Publication Date) - Modern Marketing Masters (Publisher)
Pat Lum 25:24
you do and well through to January because Amazon will spend the budget if you make it available, but it the spend will not be as efficient because there’s more window shopping at that time, less buying intent. So you’ll still blow through the budget, but the ecos will be really bad. So you don’t want really that to happen. And oh, and a tip on the holiday bidding stuff. everyone and their mom who sells on Amazon. My mom doesn’t sell on Amazon but that’d be really cool. But every everybody’s selling on Amazon is gonna bid on like holiday gifts, you know, Christmas shopping, you know, gifts, whatever. Just, I wouldn’t necessarily do those if your product doesn’t have crazy mass appeal, I would just slice one layer below that and go like, you know, holiday gifts for dad or for you know, for sister for brother, the members of the family hobbyists like, you know, presents for rock climbers, whatever it is. So you can still get that tailwind of those gift traffic search volume. But you don’t get bonked on the head with just like the crazy competitive bidding of just holiday gifts. Broadly speaking, you so that’s an interesting like in between maneuver where you can get the holiday traffic without paying holiday premiums. Okay,
yeah, like that one. Now, let’s say like you launch a new product. Is there a you know, does your team like have a because those, those keywords are probably going to be like, very targeted for like a two to four week span. So use tools to go back and look at previous years search terms? Or how would you flush those out ahead of time,
Pat Lum 26:48
in the context of like a product launches specifically?
Or let’s Yeah, let’s just say, you know, tennis racket, we lost a tennis racket, you know, in March of this year, we’ve never been through, you know, the holiday season. And so how would we start? How would we get those keywords ahead of time?
Pat Lum 27:05
Oh, gotcha, gotcha. Okay. So if this goes for launches, but this also goes for just products in general, you probably want to avoid overwhelm and overspending, you probably want a core of like 10 to 15 keywords, that is like the target basket, and there probably aren’t the largest keywords in your niche there probably, again, maybe a step down from that a bit more longtail 10 to 15. And effectively just go after those, I would pretty much put the blinders on and bid up on those track your ranking for those terms, specifically have those rankings in the listing as well. And if you can, as a bonus, like we we don’t do this yet, but I’m considering it, probably driving some external traffic to to Amazon for those terms is going to be an interesting part of launch strategies going forward. I think Amazon’s gonna like some external traffic coming in. Okay, awesome. David, over to you.
Yeah, so as a business owner, Ken and I often talk about dollars as little soldiers in and we ask the question, where do we put these little soldiers to where they can go out and come back with more soldiers. And so as it relates to putting our dollars to work, we have a lot of options probably have two more options than we have dollars and so you have to make a decision do I spend on PPC do I spend on a new product launch? Do I spend on social media and the list kind of goes on and on and on and so curious what your thoughts are on coming up with an appropriate amount of spend for PPC in we may look at like a particular like a tacos or any rules of thumb you have would be helpful I think to us in the audience.
Pat Lum 28:41
I think the punchline to this is just like the better the product is like just for the end customer the easier everything else is going to be like although we are like a marketing company, that’s our specialty. We can’t fix bad products or even we can’t fix mediocre products and nor why would you want to like that’s not a good thing to do to people like just put massive ad dollars behind this like average product that nobody like it just gets pushed to them like so when it comes to Akos takeovers conversion rate, all this stuff is actually like these are downstream symptoms of sometimes not just the products not good enough, like and that is it’s hard to fix. That’s why people don’t fix it. But like that is that’s really the choke point for a lot of these performance issues. And then Okay, so maybe you have a great product and then maybe you have an issue with the listing like the way you’re presenting it or like you’re not explaining it properly. And then maybe there’s a marketing issue but like the number one thing would just be to you know, just to diagnose upstream product quality thing and to this end like voice of the customer is really good. So again in Seller Central if you go to performance, and under that you can see what you can actually see what people are saying on a SKU level and see like, what their complaints are and what they really liked about it and just like constantly being product engineering so like to your point, David like I would put as much money as you can in to actual product development. And this is coming from marketing companies. That’s just like, I don’t, everything gets easier if you even if you’re thinking about it purely numerically, like the better product you have, the higher the click through rate is like, the better the reviews. So you get more clicks, like the better it converts the better reviews. So like the flywheel spins to outweigh the fewer returns. So your seller account is in less danger, like, and then yeah, so everything just kind of stems from the product quality. And I think people forget this, that it’s all about tactics when it when in fact, a lot of the tactics kind of take care of themselves if the quality is good. But if we say let’s say you do have a good product, right, and you want to talk about ecos, and Taegu, and stuff like that, like it’s David says this all the time, and he said it on on the show that we did together as well. sale on paper like that, is that no Truer words, because some products are never going to make sense. If folks wanted to, they could Google the Amazon FBA revenue calculator, and that’ll give you projections of what Amazon is going to charge you in fees, you can put in your cost of goods, and it’ll give you a projected profit. And then on top of that, I would encourage folks to layer on their ad spend. So to give you a sense, decent ad spend, when a product is up and up and rolling should be 20 to 30% of the MSRP, something like that. But also you should you should factor in that when you first launch a product, it’s got no reviews, and you might want to get more aggressive on keyword ranking those 10 to 15 keywords, maybe your Akos, like your spend divided by your sales, it’s probably going to be closer to 50 60% Depends how aggressive you want to get. But, you know, new launches are gonna, you know, those ad sales are gonna lose money initially to some extent. So yeah, but budget, you know, 20 to 30% of your MSRP for ads and a mature product, but more than that, at the beginning, I would say like 50 to 60%.
Thank you everyone for tuning in to part one of our podcast with Pat LOM. Please join me next week for part two, where we dive into PPC profitability in strategies that are working in 2022. Thank you everyone for tuning in to today’s Firing the Man podcast. If you liked this episode, head on over to firingtheman.com And check out our resource library for exclusive Firing the Man discounts on popular e commerce subscription services that is firingtheman.com/resource, you can also find a comprehensive library of over 50 books that Ken and I have read in the last few years that have made a meaningful impact on our business, or that head on over to www.firingtheman/library Lastly, check us out on social media at Firing the Man in on YouTube at Firing the Man for exclusive content. This is David Schomer and Ken Wilson. We’re out –
Before you go fun fact for all you Amazon sellers out there when you start selling in international marketplaces, all of your reviews come with you. At the beginning of this year, Ken and I sat down and talked of ways that we could double our businesses in size and landed on international expansion as our number one initiative this year. We partnered up with Kevin Sanderson from Maximing eCommerce and he has made the process an absolute breeze walking us step by step through the process. If you want to grow your revenue and reach new customers head on over to https://maximizingecommerce.com/fire and connect with Kevin Sanderson today. Now back to the show.