Full Transcript

Sari 0:00
Welcome to your Food Business Success. This podcast is for early stage entrepreneurs in the package food industry ready to finally turn that delicious idea into reality. I'm your host, Sari Kimbell. I have guided hundreds of food brand founders to success as an industry expert and business coach, and it's got to be fun. In this podcast, I share with you mindset tools to become a true entrepreneur and run your business like a boss, interviews with industry experts to help you understand the business you are actually in and food founder journey so you can learn what worked and didn't work, and not feel so alone in your own journey. Now, let's jump in.

Sari 0:48
Welcome back to the podcast everyone, really glad you are here with us today, and we are talking Amazon. So many of our members in Fuel are getting on Amazon, and I always love to bring in my expert guest, Luke Tierney, and this is his second time on the podcast. He's also come in and spoken with Fuel VIP group about Amazon. So Luke is my go to Amazon guy, and I'll let you do a quick intro about yourself and then we can talk about what we're going to talk about today.

Luke 1:23
All right, thank you so much, Sari. So yes, I'm the founder, CEO of EcoD2C. We are a digital marketing agency, specifically marketplaces, and more specifically Amazon, for natural product brands. So we've been around for quite a while, but we partner with natural product brands who want to scale their online sales, most of them for Amazon. We can also, you know, easily go into a conversation about Instacart or some of these other interesting online sales channel opportunities that are rising up, why Walmart is sometimes a good idea, but not good idea, etc, etc, etc, but we're here to talk about Amazon today.

Sari 2:08
Yeah, like I said, we always have questions about Amazon. It's an ever changing landscape. I'm sure you could do, we could do a podcast every three months, and you would have new things to tell us, but yeah, a lot going on. And what I like to say is, I'm not an expert in everything. I definitely have the things I am, but I know people who are and so thank you for coming on, Luke, and we're excited. I know you're going to share your screen for a couple of tools that you want to show us. We'll walk through it, but for those of you listening. But of course, this is also on YouTube, so you can actually see the slides, and we'll put the link in the show notes for that. And then we're also going to talk about holiday strategies and some things that you want to be aware of for 2024 in Amazon. So go ahead and take it away, Luke, and tell us what's going on.

Luke 3:05
Yes, so I'm going to set the stage here a little bit. So Amazon, obviously, the United States biggest ecommerce marketplace. There's a lot that we can discuss about the platform, and it's been known as the marketplace online, where you're going to have the most, we're going to have the highest conversion rate, a lot of new customer growth on Amazon, this is where a lot of people are double checking your brand no matter where they discover you. If they're in the grocery store, they're checking their phone. If they're online, they're double checking reviews on Amazon before they buy you elsewhere. We're actually going to leave a lot of that to the side, and we're going to discuss some new tools that Amazon has rolled out for engaging your customers on their marketplace. So why is this important? The tension that a lot of brands feel between their website and Amazon is that on a brand's website, you just have so much more control. You can have more nuanced loyalty programs. You can ask your customers questions directly. And Amazon, for years, has famously been a black box. And to be straightforward, is in a lot of ways, it still is a black box, we are getting more and more data from Amazon, and there's more data sets that we can build. A little bit more about this later, if we can pull data from it in a couple unique ways. The fact that Amazon's releasing tools that helps us engage customers and read and engage those repeat customers, especially because we're talking about brands in the natural products category, is something that's really interesting and just something we want to make sure that brands know about, especially ahead of the holiday season coming up.

Sari 4:48
Yeah, that's really cool to know, because I feel like for so long, it's just been like, Amazon's like, yeah, we own the customers. And it's just like, they buy from you, and there's this product that get shipped and like you don't have any awareness, like you don't have any insight, and so that's really cool. I didn't know that. So this is great.

Luke 5:07
Yep, we've got a couple. It still is not going to be equal to what you can do on your website in terms of just options for different loyalty programs, but given the sort of the powerful engine that Amazon is, and the fact that this is where a lot of your customers are going to prefer to buy your product. This is anytime they roll out a new tool like this. It's interesting. We want to take a look at it. So without further ado, I'm going to dive into what these are. The first one I want to take a look at here is called brand tailored promotions. So if you already have a seller central account, you should be able to find this fairly quickly. It's going to be underneath the advertising section is still where it live. They move these things around, but regardless, if you do a search word on Seller Central, you're going to be able to find it. Amazon has not really allowed us to send emails to customers before. They don't give us the customer's real email. There have been times in the past when we've been able to do things like send review emails, but Amazon has specifically made promotions off limits. Amazon has specifically made anything that is not a completely neutral review request, or some way of interacting with the customer regarding their orders off limits. So this is the first time that Amazon's actually let us send promotions via email in quite some time. So the tool is actually fairly simple and pretty easy to use. So first of all, you have to have brand registry. So if you have a trademark, you have to have a registered with Amazon. But assuming you have that, you'll be able to access this and they're going to give you a bunch of different buckets to choose from and granted, these buckets do have to be overneath, they have to be over a certain threshold in order for you to send these emails. So you may qualify for some buckets, but not for others, but they're going to give you a variety of options here. So one of them, one of these, and I'll explain for everybody who's listening, the options we see in front of us are repeat customers, at risk, promising potential, new customers. Brand card abandoners is a really common one, and is often a pretty low hanging fruit in terms of a group that you want to reach out to whatever channel you're on, just to try to bump people over the line. And these are just emails that are being sent down. They're offering a discount, and the minimum discount here is 10% so if I'm an Amazon customer, if I'm in that brand card abandon or bucket, for instance, and I just have it purchased, there's going to be an option to email me and everybody like me within the past 90 days and offer a 10% discount if I actually come back and if I actually go through and make that purchase. So some of these audiences you're going to see here are more repeat customer focused, which is kind of what we're talking about today. Like, how do you reward your repeat customers? How do you reach out to them to try to get them to come back if your repeat customer revenue is falling on Amazon, and we'll get into how to measure that in a minute, then what can you do to reach out to them to try to get that number back up. This has become one of our go to options. And just anecdotally, we're running these about every 90 days for our partners. So you can run these little one email shot campaigns as many times as you want. However, we've seen diminishing returns. If we're doing these, like every week or every month for instance, a quarterly rhythm allows these audiences to refill. We find and we can then, you know, target them again. So that's optional.

Sari 8:56
That makes sense. Like, you know, we're talking about package products here that you know, it's not like you're buying a one time. I just bought a chair on Amazon, so I'm not going to be repeat purchasing that. But if it's your granola or your hot sauce or something like that, then that would make sense to be sending those customers again to try to get them to purchase.

Luke 9:17
Exactly. There's also some additional coupon targeting that I wanted to go over. A lot of it follows the same audiences that I just described. So instead of, if I'm a brand card abandoner, again, for instance, I might if I visit your detail page, there's an option. Detail page is just your product page. It's what your listing is on. If you're running one of these brand card abandon or coupons, and I'm one of these individuals then I will see a coupon there. Now, personally, brand tailored promotions is my first go to for this. Even though I can set a coupon that is less than 10%, the absolute bare minimum is 5% to do a coupon on Amazon. The reason I like brand tailored promotions is because I as a customer, would actually be pinged, if you're running a coupon, then people will not see that coupon unless they happen to be scrolling over your listing again, or if you are somehow targeting them with advertising. So there is a way to use these coupons and then run some retargeting and display campaigns for instance on Amazon, especially if you already have that built out. You can work the with coupons in a more aggressive promotional way. If we're looking for low hanging fruit, it's not going to be quite as easy as the previous option, but this is here, and then also this has been available for a little while, but not every seller we talk with is aware of it, there are additional Subscribe and Save coupons that you can apply. So if you have products that are enrolled in the Subscribe and Save program, there's going to be a default 05, or 10% discount that you'll be auto enrolled with. And then if you want to put a discount on top of that, you can Subscribe and Save do coupons as well. So it really depends on what strategy you want to take. But there's a couple of options rolling out here that Amazon's giving you to create as much of a loyalty program as they will allow you to.

Sari 11:17
I'm a big fan of Subscribe and Save personally, I don't know, and sometimes, I mean, I actually buy quite a bit of food items on Amazon now, just for convenience. And I'm always shocked when people don't have a Subscribe and Save option, because I'm like, I'll take that, you know? Why not? So I'm always surprised that, you know, consumables aren't on Subscribe and Save.

Luke 11:42
This last tool I have to show is not going to be on Amazon tool. This is something that we're happy to help you out with if you want to get some precise numbers. But if you're rolling into the holiday season and you're thinking about these promotions, and you're like, well, oh, like, this sounds great, but I don't know, like, what's their turn actually going to be beyond, you know, we're talking about repeat customers. Seller Central does have a repeat customer metric. Frankly, I find it to be pretty faulty and pretty clunky. You just can't give her a granular with it. It's not going to tell you the amount of new customer revenue versus repeat customer revenue you're getting over any given date period. We have a data partner that helps us effectively. What they do is they pull all of Amazon data via an API for each one of our partners, and each customer has some unique identifying attributes to it, and then they use that to build data sets. So we can very reliably get at what LTV is. And so we can get what I call your actual repeat customer rate, because we can get granular, and then we can get at LTV which Amazon just straight up does not give you LTV, at least not at this time. So you know, if you're running these programs, if you're running these discounts, this is going to be two critical things that you're going to want to know, which is, one, what your margin is and what you can actually afford to do. And then two, you know, how many times are your repeat customers coming back? What is your customer LTV, like? These are all fairly critical metrics and CPG and so.

Sari 13:24
Especially if you're running those other things right, those emails and the coupons and all these things you want to see, like, is it actually working, right? And, I mean, it looked like there was some data around that, but plugging that into the whole model and really understanding, like, okay, great, I send them a coupon, but then does that create more repeat purchases?

Luke 13:47
And for, you know, for those promotion, for those email promotions, for the coupons, you will get a dashboard for each one of them that will tell you, hey, like, you spent, you know, you spent $200 on this promotion, and you may like two to 3000. It's that 10% discount, we'd find is interesting, because it'll bring customers back. But they might not just be getting the 10% for that item. They might start adding other things to their basket, and so the return that you get can be larger than just that's 10% that they came in with. So you'll see all of that initially, but if we're actually looking at the long view of your repeat customer and your LTV, we want to see how that trends over time and what your repeat customer revenue looks like over time, and maybe get ahead of the curve instead of simply being reactive. But through the tools that we have here, you know, we can take a look at what your repeat customer revenue is. If you don't know your financials, or you feel like your financials are a little bit fuzzy, that's something that we do in free discovery as well when we're talking with brands. And if there's anybody that's a part of Fuel that would like to chat with us if they're curious about these numbers, we're more than happy to help. But the low hanging fruit will be Seller Central's tools. And then if you want to get a little bit more sophisticated and start to answer some questions, then this would be the first place that we encourage you to look.

Sari 15:13
Amazing. Yeah, that's really helpful. And I don't know if you said it earlier, but LTV is lifetime value your customer.

Luke 15:21
Yes, lifetime value. What does a customer on average spend with you over time?

Sari 15:28
Yeah, how many crazy acronyms, CAC and LTV, all the marketing.

Luke 15:36
I can bore a dinner party very easily. I'm great on it. Thanks.

Sari 15:44
I love it, all right. Well, thanks for showing us those. And like I said, you'll be able to see them on the YouTube video as well. I mean, that's really exciting, that Amazon is allowing you at least a little bit of communication with your customers, ways to retarget them to see more of that information. Are those even available for small brands that? I know you work with a couple of folks in Fuel. You know, at what size can you use these anytime? Does that make sense?

Luke 16:16
Yeah, as long as you have an audience that's crossed the threshold, and you'll see between coupons and between brand tailored promotions. There's different kinds of audiences, like one of them is brand card abandoners past 90 days. One of them is brand card abandoners past seven days. Things like this. The threshold is 1000 for a lot of them, but not all of them. There's others that we've seen at the threshold around like 200 in them. So the fastest way to check is simply to pop into brand tailored promotions and, like, see what's available to you, if you want to run that, or see what options you have.

Sari 16:51
And how do you think that's going to change? Like, long term, you know, the landscape of Amazon around customer expectations, or have you started to see anything kind of change on the customer side of things?

Luke 17:04
Well, it's been really refreshing to see some of these tools come out. Because, I mean, Amazon rolls out a lot of things all the time, and not all of them are worth talking about. So there's a lot of really interesting things on the horizon. I'll talk about some of the past tools for a second. This is not Amazon's first crack at an email tool. The last one was like, returns were minimal, and that's just describing it nicely, and was not something I'd ever come onto a podcast to suggest that brands experiment with to see what their return is. The stuff we're talking about today, we see work pretty consistently, right? And so has this worth? You know, playing around with a brand doesn't necessarily need a partner to come in and tell them how to use it. They can learn how to do some of the stuff on their own. But, you know, there's always really big promises made. Sometimes they come through, and sometimes the reality is just a little buggier than you'd expect, but a lot of stuff that's coming out pretty soon. Anybody who was at Accelerate, or was paying attention to what came out of Accelerate Amazon's conference, there's a lot of AI capabilities that are going to roll out. So there's a pretty good chance that a lot of brands tech stacks are going to shrink. And there's going to be a lot more tools within, you know, Amazon sees this entire ecosystem of tools spinning around it, and so they're bringing some of that in internally. And so we're seeing the fruition of a lot of efforts on their part to not only shut down what some external softwares used to do like we used to be able to send more emails, for instance, to request reviews and push promotions and do other things, and they took that option away, and they're coming out with their own versions of those features. So I think we can expect that to continue into the future. So really, it's just a matter of testing each one of these when they come out to make sure that it's actually going to be worth our time and the time of the partners that we work with.

Sari 19:09
Right. Because everything, yeah, there's always an opportunity cost, right? Trying them out, seeing if they work, what else could you be doing? So if we talk about holidays as those are approaching, there's some strategies that you're seeing out there that are working for natural product brands.

Luke 19:33
Yeah, absolutely. And I'm going to harp on something here that I harp on a lot, like I mentioned financials a minute ago, a little in passing, talking about things that you want to make sure to take into take into account. I really cannot emphasize this enough. You want to make sure that your listings are set up and priced, and you have pack sizes that are constructed in such a way that Amazon's working for you as a platform and not the other way around. Just to give you an example, we talked with a brand just earlier this week. They came to us and they said, you know, hey, like, we've been doing $150,000 a month in sales, and we're taking home 6k like, what are we doing wrong? These are conversations that we have frequently with brands that come to us looking for, you know, somewhere out of the maze, if you were not set up well from a economics perspective, then like that, that 10% you know, we have, we work with partners that can do that all day, and just run those as often as they make sense. And then we have, you know, other brands that come to us, and you know they're like, well, like, if we were to run this 10% then we'd be underwater. And it's our job to work with brands to get out of that position. And to anybody who's listening here, who's wondering how they can do some double checking here. There's a lot of softwares out there that can help you. If you want to use one of Amazon's own tools, the profitability calculator is going to be really helpful. But if you know your COGS, you can see what percentage Amazon is taking out. You take out your own and then, like, what? What are you left? So you know, while we're on here talking about these new tools, new promotions that you can run, it all needs to be coming from a solid, safe place if it's going toreally going to move your brand forward.

Sari 21:39
Yeah, I love that you said that, because I think it's easy to just be like, well, I heard the strategy, and somebody said I should do this. And inside Fuel, that's a lot of what we do is like, let's make sure that this actually makes sense for your business. And, you know, I know that there's the idea of, like, we'll just get on Amazon and think, you know, it's like any sales channel, just get on Amazon and you'll be raking it in. But, like, there's a lot of to figure out here, and a lot of nuance, and you know, you do need to do that work as a founder, to just to do your due diligence and say, does this actually make sense? And that's why I'm a big fan of like, go to the people like yourself who know this stuff. Come to Play people like me. Go find the experts who talk to the brands over and over again and see all the mistakes, and you know, know the shortcut and how to fix those things, and make sure that your strategy aligns with your goals and with your particular product, and the COGS and all of it, it's very nuanced.

Luke 22:48
There's a lot of moving parts, for sure, but the question that we look for from brands that we talk with and if we're not hearing it, the question that we encourage them to answer is not how do we get to $100,000 a month? That's a conversation we can have. We can talk about search traffic. We can take a look at, you know, one of the tools that other tools that Amazon has released recently is, you know, a product opportunity explore where you can get in and you can see the amount of click share any given search term has in the space. You can see the search volume. You can see the amount of sales from any given search term. Now, there's a lot of things we can look at and try to map out how to get to that number. But especially in an environment which you know, investor dollars are thinner, or, like a lot more variants are bootstrapped these days. They need to be sustainable now, the better question, the question that we look for and the question that we work with our brands to answer as a foundational element is how much money do you have to reinvest back into your product, right? And do you have a buffer there for when incidentals occur, like CPGs? It's often said that CPG can be death by 1000 cuts. So this is simply the strategy to get ahead of making sure that this is not a channel that feels that way, and as it is to so many brands, but you know, you're always going to feel that tension between trying to price, trying to be competitive on price with competitors, depends on what your pricing strategy is against them, but that's just a frequent tension that we see and having more and more margin. But there is a way to be set up here that just achieves a minimum amount of percentage points for you to be taking home or for you to be reinvesting back in that will make this make sense.

Sari 24:49
Are you still seeing like the integration of you know, you might have your e commerce website, but integrating your Amazon into that? Does that still make sense from just a convenience standpoint?

Luke 25:02
In terms of an integrated strategy. So one way that I've heard this put that I think is wise, is to think of your website as your VIP club, and Amazon, where a lot of your customers are going to go. So we often recommend, there's a lot of ways that brands can approach this. It's often recommendable to have you know, different offers on your website versus Amazon. The reason that one of the reasons, one of many reasons that Amazon is like is leading in the way that it is, is because it's, if you look at research on what e commerce customers in the US prefer, it's a lot of stuff that Amazon does well, it's having free shipping within a couple of days. It's having, you know, having those loyalty programs. They exist on Amazon. It's just where, you know, we're getting slightly more control over them. But Amazon does treat its customers particularly well. Famously, that's their mission as a company, to be the world's most consumer centric entity out there. You know, they want easy returns. Easy returns is a big one.

Sari 26:14
Somebody who bought a chair, returned a chair.

Luke 26:18
Yes, I've done the same thing. I've done the same exact same thing. See, over 60% of American consumers would rather buy from a marketplace like Amazon than from a retailer side or from a brand site. So if you want to, if you're trying to pull customers to your site, incentivize them to be there, you're working against that over 60% figure. So you really need to give customers a good reason to be there, and you can do that with the more VIP feeling kind of service and level of communication. We do highly recommend that brands focus on this. The reality is, anywhere you have increased visibility, anywhere you have increased brand awareness, that's going to lead to more traffic on Amazons and hopefully more conversions on Amazon. One of the things that we do with, you know, any number of partners is we like to suggest other channels. If they have suggests on PR, if they have success on PR, if they have success with me, if they have success with Google ads, if they have success in you know, grocery retail expansion, it's going to mean more sales on Amazon. It's going to make us look great. And so for website like I will recommend that brands drive traffic from other online ads platforms like meta or Google. I'll recommend that they do their website over Amazon, or at least, you know, before Amazon or AB test, you know however you want to try it, I would prioritize building that audience of people who will buy on your website versus Amazon any day, because I know I'm going to get a decent amount of those customers that you are, the best prospective customers that you're drumming up anyways. But anything that you can capture there, it's going to help you find your strategy, because you're going to be able to talk more going to be able to talk more one on one with that consumer. And then if you pass those learnings on to us, we can use that in your Amazon copy, and we can implement, you know, good omni channel fundamentals to then implement a wider strategy and help that rising tide lift all boats.

Sari 28:20
I know we kind of got off the holiday topic, but was there anything else to add around holiday strategy? I mean, I know, you know, we talk about, like, your advertising on meta and stuff like that, like it's the most expensive time of the year coming up as we get into Black Friday and Cyber Monday and all of that. And the lead in there, is it the same way on Amazon, as far as running promotions? Is it more expensive, or does it stay the same?

Luke 28:49
CPCs tend to spike, you also want to flight your your advertising budget accordingly. The thing about Amazon, versus a lot of these other platforms, on meta, you can run a lot of like, seasonal creative, for example. On Amazon, you're not going to have, you're going to have promotional opportunities. Like, literally, today is Prime Day, right? We're recording is private, so you have seasonal opportunities in the way that there's you're going to have surges on Amazon's platform on days like today. You're going to have big surges all around Black Friday, Cyber Monday. That's going to be a major four day weekend. But you're not going to be able to take a medic creative that you have that is more like Christmas themed, for instance, and run that in the same way. Your ads on Amazon are, by and large, going to be evergreen content. It's going to be your main image, the first eight or so characters of your title of any you know, video content that follows their guidelines. They like to keep their promotions. They like to keep promotional. Creative and copy to what would they like to publish. So a lot of it comes back to the fundamentals of, what can we afford to invest? Where are we putting those dollars? Advertising could be a whole episode of all the different things you can focus on there. You will see different kinds of seasonal terms start to show up. And even if we can't put that in our ad creative, we can sure as heck target those terms. That's going to be a little bit more nuanced in terms of an ad strategy. And if you've done this before, year over year, and if I don't know how many of these brands are that are listening, are going to be running their own advertising personally, this is kind of an in the weeds keyword strategy kind of thing. But absolutely feel free to whether it's you or if you have a partner running it. It's absolutely relevant to ask them, like, hey, like, are there any keyword strategies that are going to be a little bit different at this time of year versus the rest of the year? Like, we have clients that gifts keywords with gifts or, you know, bundles, you know, things like this, start to show up a lot more. And we know to push the products that best fit that for gift sets. And we know to push advertising budget that way, just to ramp up as the season gets rolling. So those are all relevant questions.
Luke
Well, you know hot sauce gift sets, you know is just one such example, but in terms of things that you can easily implement without getting into the world of ads, campaigns, budgets, ad groups, you know, proper segmentation, etc, the lower hanging fruit is going to be like some of these, you know, promotional tools well timed to get your customers to come find you when you want them to.

Sari
I love it. Well. Thanks so much for coming on and updating us and sharing some of these new tools that are allowing you a little bit of modicum of customer engagement directly through Amazon. Luke, where can people find you?

Luke
So feel free to email me. I'm [email protected]. And if you have any questions, feel free to reach out.

Sari
Good, yeah. And I know you offer a nice little package for setup inside Fuel and our members. And appreciate you doing that, and you're our go to guy for Amazon. So thanks for coming on. I hope that was so helpful. If you're on Amazon or you're thinking about going on Amazon, it's so good to know what new tools are available and how the landscape is changing and what to expect. Amazon is an incredible platform. It's not for everyone, but it's definitely a platform that you want to consider. And even if it's just getting up that initial page, even if you're not running any advertising, you're not spending any additional money, I think I'm always just a fan of like, go and skip the line. You don't need to figure this stuff out for yourself. Go work with a great partner like Luke's team, and just get up, get it done right, and then you can always come back to it as a longer term strategy and build it out over time. So do consider Amazon as a great sales channel, and educate yourself on these amazing tools and how you can grow your business there. Until next time, have an amazing week.

Sari
The smartest thing you can do as an entrepreneur is to invest in a who to help you with the how to speed up your journey and help you skip the line. When you are ready for more support and accountability to finally get this thing done, you can work with me in two ways, get me all to yourself with one on one business coaching, or join Food Business Success, which includes membership inside Fuel our community of food business founders that includes monthly live group coaching calls and so much more. It's one of my favorite places to hang out, and I would love to see you there. Go to foodbizsuccess.com to start your journey towards your own Food Business Success.