Check-in with Kris and Dustin as they break down common mistakes to avoid when launching your new private label product for Amazon FBA.
See more of Dustin and Kris on our YouTube channel: https://www.youtube.com/channel/UCImqJsK7Ru_hC2ZLnBC_f_Q
Hear more from the Two Amazon Sellers and a Microphone podcast here: https://anchor.fm/2amzsellersandamicrophone
– Hello everyone and welcome to episode 19 of Two Amazon Sellers and a Microphone. I’m Dustin Kane and with me as always is Kris Gramlich, what’s up, Kris?
– Not much, how are you doing?
– I’m great, I’m great. It’s another chief’s day in Kansas city here. We’ve got some early Monday night football so, it’s gonna be exciting tonight.
– Yeah, I can’t wait then, you know it’s four o’clock games, so we may be checking out a little early today.
– Yeah. Yeah, we started our recording a little, little early just to make sure we make it. So I’d always make the fun around here but today’s gonna be good. Today we’re gonna be talking about five common mistakes to avoid as a new Amazon FBA seller. And boy, did we make these, some of these mistakes ourselves?
– Mmhh yeah, these are things that you and I both went through. So this is gonna be good to kind of touch on these. So you as new sellers or people that are currently selling avoid these because these are headaches that you and I both went through.
– Mmhh. And these are easy traps to fall in to as well. And you’ll see, as we go through these. So let’s just take our advice on this, that it’s you definitely want to avoid these mistakes right off the bat. So let’s get started. Let’s, let’s start with, let’s start with most common mistake number one, and that’s Picking a Super Competitive Product. This, this is a killer.
– Yeah this, cause this can just burn your money. You’re gonna get into something that’s super competitive. And by super competitive, like if you’re looking for a product and you go to page one for the product and there is over like two or three or even four or five sellers that have over a thousand reviews, that right there just tells you to move on to the next one. So, if you know, you’re looking for a product then on page one, there you see thousands and thousands of reviews and that, that’ll tell you a red flag, move on to the next. Yeah but if you get, if you do this and you, you pick a two competitive product that’s gonna be hard for you to compete with those sellers that have those thousands of reviews. Not only on like review cabinet pricing, their images, I mean, they’ve got history they’re running probably really competitive ads. So, you know, just move on that. And that’s the first thing I do when looking for a new product if it’s over, a thousand reviews and there’s over three or four sellers on page one that have over a thousand reviews, I’ll go onto the next one.
– Yeah, and this doesn’t mean you can’t compete with them. It’s just gonna be cost prohibitive like you said, I mean, it would take so much time and money to outrank them that it’s just not worth it. Especially if it’s your first product and you have a limited budget you know, you have to have other tools in your tool belt, such as like a lot of other products in a brand that you could push advertising tube and now a new competitive product where you could help trigger that launch to make that worthwhile. But I think there’s another way you could look at competitive products. If you go and you type in, you know, your generic product, category, your name, whatever. And if you see page after page, after page, after page of the same looking kind of product, that’s another thing you got to avoid. Even, even if the reviews are, you know, there’s not a ton of a thousand reviews, but there’s so many sellers. Those are gonna be all the sellers that are typically what happens is, there’ll be frustrated once they’ll be frustrated, so they’ll lower their price to liquidate. So they’ll capture all the sales for a little while, somebody else will be bidding high on campaigns. It’s just, they’re all trying to compete for the same eyeballs and they get burned and they liquidate. Liquidating is another big one that people don’t talk about a lot. But when someone’s liquidating at a low price they’re getting all the sales happening all the time in your category. It can be a struggle. That’s one thing that for sure happened to me is my, I actually didn’t start with too competitive of a product, but it became competitive. And I kept trying to stay with it and push, push push. And yeah, I was at a very low price and I could never be the low price because there was always 10 or 12 other people trying to sell out of their inventory. So there’s lots of different ways that you can consider something too competitive.
– And if you, if you’ve get set on a product that you wanna do and you know, the competition’s there and it’s competitive. If that’s the product you’re gonna pick then you need to figure out a way to make a different like, make it a bundle or add another product to it, you know, change a feature on it. But that’s only if you’re like, that’s the product you’re gonna go after then figuring out a way to make it different because you don’t wanna just be selling another in a mouse pad or dog brush. You wanna figure out a way to make it different from those that are on page one. So, you know, those are just that, that’s the, that’s the first one, if it’s too competitive, move on. But if you’re gonna stick with it, figure out a way to make it better. Because again, like you mentioned you’re gonna just be spinning your wheels.
– Yeah. And another thing just to stay on this topic is whatever you do don’t jump onto a trend or a fad. If something is trendy or a, it’s a fad right now by the time you go through all the hoops to get on the Amazon, that trend could be dead, it can be saturated. People can like we said, have already been burned and liquidating. So that’s a common mistake because you assume, because it’s so popular, that it’s a good Avenue to go down and it’s definitely not. You’ll get burned. I can, I’ve got a great story on that, fidget spinners.
– before I talk about it.
– Sure. Yeah. So this, so I was a well-established seller by this point, I should have known better. This was, by the time the fidget spinner crazy came on, I was already dealing with a supplier that had them. So I was like, let me just do this real quick. This will be a quick test or a couple thousand units, they were cheap. Got him into FBA. So the laid out the initial capital got them shipped. They go to FBA. Right now, fidget spinners gotta be like one of the number one search terms on Amazon at that time. I mean, they were flying off and I was doing a bunch of competitor analysis. You could see people out there were selling to 500,000 units a day of these suckers.
– And When was this, like 2017 or Early 18?
– Yeah that, I think 2017, I believe it was. So yeah, I thought, and I got onto Amazon. It was still hot, everything was still rolling, I thought, okay, this is good. I know it’s gonna die but let’s see if I can sell this inventory. The second, my inventory hit Amazon. It was live for one day, I made two sales and then Amazon shut down that category. There was all this craziness about fidget spinners , like being a choking hazard or causing these issues with kids. And so Amazon now made you have to get all this legal stuff to prove that your product was approved for that category. And it was, it was crazy. So I had, I basically brought all that inventory back to me. So another cost and then I had a garage sale and sold it for 50 cents a piece and was the most popular guy in my neighborhood. I should have gone that route initially. So, but yeah, that’s just a cautionary tale. It’s it sounds too good to be true. And it usually is. And 90% of the people that tried to get in there got burned. There was a few early adopters that for sure killed it but just avoid that mistake at all costs.
– That’s a good, that’s a good lesson there. I think when I first heard that from me I was like, man, I am, I am gonna stay away from fads. Like that’s, if it’s something that’s hot right now I’m not gonna invest in it, I’ll stick with my brand.
– What’s crazy is I knew better. I knew better than to do it but it was such, it was so popular at that time. And I had two boys and all they did was play with those dumb things. I mean, all the time and every one of their friends did. So I said oh, okay. I’ll figure something out of this
– That was me abandoning my long-term strategy. And I should never have done it but still that’s good cautionary tale there. Now, why don’t we talk about the flip side? The second common mistake is the exact opposite of this. Like if you pick a product with no demand you’re gonna be up against a whole nother wall.
– Yeah. And the reason for this one is you’ll do product research and you may search like one keyword or one search phrase. And it, and it may have really good to me. And as far as like the volume that is pointing back as far as search demand, but usually that’s like, we’re 90% of the sales are coming from as that one search term. And so if you don’t, if you’re doing product research and you can’t find at least like five or six or seven key words or search terms, that would be a good target for you to go after when your product is live. Then there’s probably not a lot of demand for that. And if you do go after that product all the sellers are gonna go after that one search term. And you’re all gonna be fighting for that same search term. And your cost per clicks are gonna go up with advertising. You’re all gonna try to rank for that same keyword. I like to go after products that have like a lot of diversity as far as diversification, as far as keywords because I wanna target a lot of a long tail keywords or, you know, long search terms or different types of search terms, not just that one. So when doing product research, make sure you pick a product that has a search volume spread out amongst different keywords. So you’re not just all going after one. And that’s where I think this is a good step picking a product with no demand. If you feel like it’s something that you’re gonna go after make sure that there is demand for that product amongst all of the search terms.
– Yeah. So I think you guys can see the point here is there is a sweet spot. There is a middle ground where you got to find a product that people are looking for, but it’s not super saturated. So you can stake your claim. You can gain some real estate in that, in that area and generate sales. And, and that’s, you know, that’s part of the trick in terms of finding your initial product is finding that sweet spot where it’s not gonna cost you that much to compete but there’s still people out there looking for your product. Another interesting one that goes in this with no demand is if you’ve invented your own new product if it’s something that the market isn’t aware of, or doesn’t even know it’s supposed to be searching for it, you could find yourself in a little bit of a black hole on Amazon, where nobody’s searching for you and nobody finds you no matter how cool your product is. You have to, in that case, you have to do a lot of stuff to educate the public that your product is there. And then it fits a need that they have before they even know how to search for it. So that can be tricky because it’s hard to do that on Amazon alone. You know, it’s hard, it’s hard with, it’s hard when PPC campaigns for a product that no one knows how to search for. So there’s a lot of issues there. So not saying that if you’ve invented something great you shouldn’t go full throttle after it. You just gotta be aware of it’s, it’s hard to launch on Amazon with no demand.
– Yeah and I think the most important thing to take away there is make sure that the search terms you’re gonna go after, make sure they exist, not just one main search term. Make sure you have at least five or six search terms that you can target as we’ll talk about Amazon advertising here in a minute but you wanna make sure you could have like five or six keywords of search terms that you wanna target for this new product. And if you can’t come up with that, there’s probably not a lot of demand for that product.
– Yeah, great, great point there, Kris. All right, let’s move on. Number three. This is something we see all day, every day is not spending enough time on your listing and this is a killer. that if, if you don’t have unreal photos, super high quality, lifestyle images, a great title, great bullet points, bullet points that include all of your potential keywords. If you don’t have, it’s less important. But if you, if you don’t, if you have the opportunity to have a plus content and you don’t have it. That’s, you’re not utilizing everything you can but the listing is your conversion tool. It doesn’t matter how many people go to your listing, how much advertising you run or how popular the search term is and where you’re ranked. If, if it’s, if nobody wants to buy your product if you’re looking at the listing because the images are bad or they’re your competitor who’s right next to you looks better and they leave you, you’re shooting yourself in the foot. So you have to spend time to make your listing as good as it could possibly be.
– Yeah and unfortunately, this is where people like, you know, blame their ad is not performing . My advertising is not doing well but it may not be an ad problem, it may be a listing problem. So you may have a listing issue where maybe you’re not indexed for your main keywords or maybe your title is too short or maybe your images are just awful. So I’ll pass podcasts. You and I both said like your listing is your real estate. Like that needs to be the best. Invest in, invest in your listing, you know, get great images, pay the $500,000 or whatever it is to get good images. Make sure you got good titles, do bullet points correctly, use the description, get A-plus content, register for brand registry, get a video created like all that stuff is going to help in the long run. And by not doing these you’re only going to hurt yourself as far as ranking goes and as far as your advertising goes.
– Yeah. And if your listing has a bad conversion rate, Amazon moves you down the rankings. And so if you have a bad converting listing and then you spend money advertising on it and you are paying to prove Amazon that your listing doesn’t work, it’s you’re paying to shove yourself down the list down the rank. It’s, it’s so critical not to mention that your listing can get you ranked. I mean, you’ve got, which we’ll have people on in future episodes that talk about just like search engine optimization for your listing like best practices for that. But I mean, if you, if all your keywords are in there and you’ve got good conversions, et cetera you’re gonna rank better for all of your keywords you’re trying to rank for. So don’t skimp out on the listing
– And to touch on that for your conversion rate, you can find that in your Amazon account. Look under the unit session percentage, it’ll be in your FBA report section but you wouldn’t know what that unit session percentage is because that’s gonna be your conversion or you’re going after. Some of my products have like 35%, 50%, but I’m in a really like not a competitive news, but really niche product but you wanna see what that percentage is. That’ll tell you how good your listing is performing and obviously the higher that percentage is the better your listing is improving.
– Yeah and every day Amazon comes out with new tools and features that you, if you stay on top of you can make your listing better and better. I mean, right, right now we’ve got videos that, you know we’ve had videos for a while, but it was with just sponsor with, if you’re brand registered now almost anybody can run videos and they’re moving up where they show up in terms of their it’s like the second image could be your video. So there’s lots of stuff that can, can improve on that. So make sure you spend time doing it. All right, number four, this I’m ultra guilty . And this is a tough one to avoid too because it is so tempting as well. But mistake, common mistake number four is launching additional products too soon. And what we mean by that is, if you’ve just launched your first product and you’re, it’s not, you know, fully, it’s not ranked yet. You’re still you know, trying to spend a lot of money on ads, you’re still in launch phase. You just haven’t thoroughly tested out. You don’t know, you know what it’s going to grow to. If you start taking capital away from that and moving it to a new product you’re gonna, you’re gonna be in trouble. You’re gonna hurt something. it can, it can make your, it can get you too thin for sure.
– Yeah This is a big mistake I made. One of the credit, like a line of products with a brand and you know, sourced one product and then immediately source another and then a source and another. And by the time they came to restock, the first one I didn’t have any capital to do that because all my capital was in all my inventory for the new products. So you just kind of have to liquidate the first one. And then you got to pick, it’s just nightmare. Like total nightmare. You’ll run out of funding fast. You’ll be scrambling trying to figure out a way to make a work. I would definitely avoid launching a second product or third product or any product until you have your first product doing a lag 15 to 20 sales a day consistently, constantly doing consistently good sales and let that run for a while. So make sure you’re only launching another product until your first product is doing you know, 15 to 20, maybe 25 sales a day. Cause that’ll give you enough capital to launch the next one. And then as you launch the second product we’ll probably talk about it. Other tips is keep it within the same niche. So you can kind of feed, feed off of the first product. But yeah, this, this one is something I have done. It’s hard to avoid this one because when you launch that product you just wanna continue to launch another one cause it’s fun to launch products. It’s fun to like see that ranking, and it’s fun to create the listings. It’s fun to get new images, but avoid the temptation. Let the, let the first one sell, get that ranking up. And then you can turn that into your second and third product.
– Yeah you hit on all the good points that are I’m definitely guilty as charged here. The thing that’s the, I feel like, at least for me, the trickiest in this business is to manage your cashflow and know what to expect. And when you launch a product, you’ve got your, you’re gonna be out your initial amount you’ve to buy your initial inventory, Okay? So that means you’ll be out for a while. Then it takes a while to get in the inventory. Once it gets in the inventory, you’re gonna be out advertising expenses and giveaways and all that other stuff you have to do. So there’s more there. And then as soon as you get close to running out of your inventory, you’re most likely gonna have to order like a double of size or triple size that you did on the first one. So you have to have all of those costs built in before you even really start bringing in money off this product. So if you’re doing that multiple times over at the same time, you better have a big, big budget to work with. Otherwise it’s gonna be, it’s gonna be tricky. So I encourage everyone to avoid that even though of all of them, that’s the most tempting.
– Yeah, this one really sucks. I hated this one . This is just cause it is so pretending, you and I both have went through it where like we get that first one launched and it starts to sell and immediately you’re like, okay, let’s do another product. And then you start to focus on that second product and get that listing going. And then now you’ve got your inventory gone while you took your eye off your first product. And now it’s not doing as well as it was before. And now you gotta kind of scramble because you got a new product come in, but you got your first one, it’s still not selling well, it’s a headache. It’s a headache, I would, this was probably the most important one for me anyways. Making sure you don’t launch too soon.
– Yeah, grow slow, grow slow.
– Let’s talk about, let’s talk about five . I’m sick of talking about this one, it makes me sick.
– All right. Number five. This is another one that we see all the time. If you ever hear anybody complain about advertising on Amazon, how it’s expensive and it doesn’t work. That’s because they’re advertising without optimizing and you can you can throw money straight down that very fast and not get a return if you don’t spend time optimizing it. And, and we can talk a little bit about what that looks like, but this is also where Kris and I’s role at sellozo where we help sellers daily optimize their advertising, and we can automate it through our platform. So Kris, touch on touch on what this, what advertising without optimizing looks like and what it can do for you.
– Yeah, so especially for new sellers or maybe even some established sellers there, we’ll just set up a generic auto campaign and just kind of let it run and not even touch it. By touching it, I mean like going into your Amazon reports and looking at the search terms and making negative keywords, this may also foreign for you guys all out there, but this is what we’re talking about when we mean optimization. I mean it’s a different mindset whereas, before, you know, creative mindset, product launch, product research make a listing it’s all creative. Amazon PPC is more technical analytics. You gotta look at the data, you gotta make changes, you gotta make bid adjustments. So this is what we do over at sellozo. We automate this process and by automating it means every day sellozo add technology, add engine you’ll go into your campaigns and then I’ll make bid adjustments on all of your keywords daily. It’ll do the negative keywords for you. So you don’t have to it’ll transfer keywords from one campaign to the next. So you don’t have to constantly do all this. Like Amazon PPC, it’ll take you six, 10 hours a week to just focus on. This is where sellozo come in and do all that for you so that you can focus on getting your listing better, optimize ranking higher for your search terms, product research per sale. But these are all steps you need to do with your ads. So you just not burning money. Cause we’ve seen sellers all the time that just set up an auto campaign maybe a broad match campaign and just let it run, but they do no optimization. And if they just did some simple things they could cut out that wasted ad spend. They could add more money to the business, which can help them launch new products.
– Yeah, that it’s so key Cause you do have to advertise as part of your launch strategy and you basically have to advertise forever on Amazon to protect yourself now, at least. And so if you’re not optimizing it you’re never going to get it to where it’s profitable. And then you’re gonna, you’re gonna leave the game and you don’t want to leave the game, this game is too fun. You can have too much success with it. You definitely need to be optimizing your ads and Kris and I can talk you through it. So you can go to sellozo.com right now, if you’re in this stage right now where you’re getting ready to launch ads or you just launched ads go to sellozo.com Click on book a demo and you can, you’ll schedule a time and it’ll be either Kris or I, we’d love to talk you through this one because we don’t want you making this mistake either.
– Or if you’ve got a question join us on Facebook live or YouTube live. We do these live every day, more than, more than happy to answer that question live. And so if you do come find us at S E L L O Z O we’ll be on LinkedIn as well. You can come in type and type your question in and we’ll, we’ll hit my answer for you live.
– Absolutely. And if you’re listening on the podcast, we’d love for you to, when you’re done with this, leave us a review. We hope we’re giving out really good information here to sellers, I hope it’s beneficial to you. So if you can go give us a nice review on whatever podcasts you’re listening through, whether it’s on Google or Apple or on anchor, wherever you’re listening to us, please leave us a review. Help us move up the rankings
– Yeah, for sure.
– All right everybody. Well, that was today’s episode. Hopefully these, these are five mistakes that you can avoid in your journey, but we’re here for you. We’ll help you listen and next time we’ll be back at this tomorrow. Kris, that was fun.
– I’ll see you then.
– All right, bye guys.