Ask me anything about eCommerce (Ongoing)

[faromic]

Thanks for doing this biophase, I've learned a ton from this thread.

I have a question with regards to branding. You've talked about improving products and creating a brand around your products. I have a couple questions with respect to that:
1. Do you have one single brand that encompasses all your products? If so, I'm assuming all your products are in the same niche or at least similar niches right?
2. I imagine you come across products that you think you can improve that are not in your current niche or may not line up with your current brand. At that point do you start a new brand, in a new niche?

I have an MS in engineering too and tend to think very analytically sometimes. Sometimes it's good but sometimes I feel like it hurts me because I just keep digging to try and get all the answers instead of taking action.

Thanks again

 

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[biophase]

What's your opinion on operating solely through Amazon? There is obviously less control since you are at Amazon's mercy and I'm sure you've heard the horror stories about sellers getting shut down for factors out of their control. As entrepreneurs we are risk takers and so there will always be inherent risk in what we do, but how do you weigh up the risk in this case? Are the risks too high to be operating solely on Amazon in your opinion?

You shouldn't have all your baskets in Amazon. Once you are established you should look for other avenues of income.

But the risks are only too high if you are relying on all that Amazon income. Let's say I made $50k outside of Amazon and $100k in Amazon. But I live a $50k/yr lifestyle. Then I'm still ok if Amazon goes away suddenly. But if I decide to buy a $500k house and nice cars, then the Amazon income becomes alot more risky.

 

[biophase]

Thanks for doing this biophase, I've learned a ton from this thread.

I have a question with regards to branding. You've talked about improving products and creating a brand around your products. I have a couple questions with respect to that:
1. Do you have one single brand that encompasses all your products? If so, I'm assuming all your products are in the same niche or at least similar niches right?
2. I imagine you come across products that you think you can improve that are not in your current niche or may not line up with your current brand. At that point do you start a new brand, in a new niche?

I have an MS in engineering too and tend to think very analytically sometimes. Sometimes it's good but sometimes I feel like it hurts me because I just keep digging to try and get all the answers instead of taking action.

Thanks again

1) I have multiple brands. I have a high end brands and low end brands. The products are in similar niches so that the brands don't look weird.
2) I usually skip them, pass them to my friends.

 

[Jay2]

Kenric, what do you use for market research beyond the obvious Google adwords/keyword traffic chart & basic amazon/ebay searches/movers & shakers?

Perhaps a product like a level board, I would want to know the top 1-3 selling brands, volume of ecomm sales, sales price deviation, and many more things about a particular product. are there websites/tools that are useful for this? I know market research companies compile lots of useful data.

 

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[biophase]

Kenric, what do you use for market research beyond the obvious Google adwords/keyword traffic chart & basic amazon/ebay searches/movers & shakers?

Perhaps a product like a level board, I would want to know the top 1-3 selling brands, volume of ecomm sales, sales price deviation, and many more things about a particular product. are there websites/tools that are useful for this? I know market research companies compile lots of useful data.

I don't do any market research the way you guys do it. I never look at that stuff. Sometimes I may check out the Amazon ranking, but really who cares. If I can sell 1 a day, 30 units a month and make $10 a unit, that's $300 to my bottom line.

So while everyone is looking for a huge hit. I've got 10 improved, low volume selling products, making me $3000 a month. And guess what else..... I didn't have to giveaway any to rank. I didn't need to get reviews. I just sit at number 1 or 2 all day. I don't need to compete with anyone, because all the AMZ class people won't touch this product.

In your example, you are implying that the only reason you want to get into the level board is because it is hot and you want to know how much the top 3 people are selling. If the answer was 1 unit a day, you would not do it. If the answer was 1000 units a day, then you would do it. This would be destined to fail because you will be just another level board.

 

[Wisith]

Hey Kenric,

I read the thread in its entirety a while back, and been reading new posts and revisiting old ones here and there. Apologies if some of these questions were already answered or if I got some of the info confused.

You have a master's in engineering, how did you get into e-commerce? I think you stated earlier in the thread that you weren't dependent on the project as you were still at your full time job. I found the switch to be very interesting since it relates to me as well, haha.

Did you start with private labeling right away or did you dabble in retail and/or arbitrage first?

Did you learn things by trial and error? I see there are so many sources that claim to teach 'students' from start to finish for $xxx. I can't knock the creators though, that's their fast lane path afterall.

In addition to your thread, I've been reading stuff on FBA elsewhere and I noticed how heavily some people rely on services like Junglescout or use services that will look up the ASIN of competitors that will look up their search words. It appears a lot of them also care a lot about the best seller rankings. Your way looks a lot more simple...find a product you can improve upon, implement the improvements, and go from there.

It seems that is the biggest difference from this board and other places I've read at. We care about improving something or being an asset to someone. Other people are trying to get fast money and see what will be in next quarter, ie right now in Q4 a lot are killing with toys and other wanted gifts for the holidays. Now they're trying to see what will be hot for Q1.

Thanks for your time, bud.

 

[Jay2]

Well, I think the example of level board is poor, I wouldn't try a product quite like that.

It's more like just product research when you have a limited bankroll of 1-3K to invest. I think your business strategy is obviously terrific of improving products and building a brand that way.

 

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[biophase]

Well, I think the example of level board is poor, I wouldn't try a product quite like that.

It's more like just product research when you have a limited bankroll of 1-3K to invest. I think your business strategy is obviously terrific of improving products and building a brand that way.

The problem is that with your limited bankroll, everyone starting has the same bankroll. So if you stick to the same criteria as everyone else you end up competing against all the newbies. You'd be better off researching a product that needs 10k to start with because when you find it, you will profit more per sale and have less competition.

I have a friend that is looking into products that cost $200 wholesale, sell for $700 on Amazon. You can bet there is nobody else from an AMZ class doing that.

 

[biophase]

Hey Kenric,

I read the thread in its entirety a while back, and been reading new posts and revisiting old ones here and there. Apologies if some of these questions were already answered or if I got some of the info confused.

You have a master's in engineering, how did you get into e-commerce? I think you stated earlier in the thread that you weren't dependent on the project as you were still at your full time job. I found the switch to be very interesting since it relates to me as well, haha.

Actually I had quit engineering and was investing in real estate. Then made the switch to ecommerce when the housing market crashed in 2007. I had already learned HTML and some CSS just by blogging and having my own personal website at the time.

Did you start with private labeling right away or did you dabble in retail and/or arbitrage first?

I started with dropshipping. It's important to note that I did not do any private label. Private label implies that I just slapped my brand on something and imported it. I have never brought over something that was not unique to me. Although some people have copied them now.

Did you learn things by trial and error? I see there are so many sources that claim to teach 'students' from start to finish for $xxx. I can't knock the creators though, that's their fast lane path afterall.

Yes, when I started ecommerce or even selling FBA in 2011. There were no classes. In fact, alot of things I did back in 2011 are the same that are taught in those classes. But there weren't any review groups back then.

In addition to your thread, I've been reading stuff on FBA elsewhere and I noticed how heavily some people rely on services like Junglescout or use services that will look up the ASIN of competitors that will look up their search words. It appears a lot of them also care a lot about the best seller rankings. Your way looks a lot more simple...find a product you can improve upon, implement the improvements, and go from there.

Yeah I never look at that. Like I said, I have about 80 SKUs so adding a new SKU that sells 1 a day is fine with me. That's 365 more sales a year and probably $3650-$5000 more in profit.

I just received 3 products on Amazon from 3 different listings, with 3 different photos. Guess what, they are all exactly the same and come in the same packaging. One seller put a small tag on the outside bag. The other two have no branding. Not even a single sticker, label, card, etc... In fact, I can't even tell which came from which now.

They sold for $17, $21 and $27. Because they are exactly the same, all their "real" reviews mention 2 distinct issues. The product is not big enough in some places and it is too short in others. So what do you think I'm going to do?

I just contacted a couple suppliers last night for this product. I'm going to fix those 2 issues and launch against them. You better believe that in my photos and product description I will mention the 2 improved portions.

If you asked me what the BSR is for this product or how many these 3 sellers sell per day, I would have no idea. Does it really matter?

 

[DrkSide]

The problem is that with your limited bankroll, everyone starting has the same bankroll. So if you stick to the same criteria as everyone else you end up competing against all the newbies. You'd be better off researching a product that needs 10k to start with because when you find it, you will profit more per sale and have less competition.

I have a friend that is looking into products that cost $200 wholesale, sell for $700 on Amazon. You can bet there is nobody else from an AMZ class doing that.

This is exactly what I ran up against. My first product was a low barrier to entry on price and therefore competition came in high numbers. These guys were doing huge giveaways and spending way more on advertising that what I could.

After I ditched that product and I went to a niche that is a little higher priced. Not by much but the average unit cost is 20-25 which is above what the gurus/classes/courses teach. It means that I have had a relative low amount of niche competition and actually no new direct competitors to my product.

The higher your product cost the higher the barrier to entry is.

 

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[biophase]

This is exactly what I ran up against. My first product was a low barrier to entry on price and therefore competition came in high numbers. These guys were doing huge giveaways and spending way more on advertising that what I could.

On Cyber Monday I dropped one of my products to $7.99, sold each one at a $1.50 loss. Sold 87 of them. Jumped from page 6 to the bottom of page 1. After the holidays, I'm going to drop it back down to $7.99 again and leave it there until I'm top 1-3. I can afford to go months losing money on a product to rank it.

Let's say I sell 2000 a month and lose $3500 a month for 2 months straight. Assume that I rank at #1 afterwards. Then I raise my price back up to $20 and make $10 a sale. Now I'm selling only 1000 month (due to the price increase) and $10, making $10000 a month. I make my lost money back in 1 month.

 

[biophase]

This is exactly what I ran up against. My first product was a low barrier to entry on price and therefore competition came in high numbers. These guys were doing huge giveaways and spending way more on advertising that what I could.

BTW, I'm trying something new right now where I drop my prices for a few hours during the day if sales are slow. I'm doing this so I get a steady stream of sales. Basically I sell 10 at profit, then 20 at a loss, the day comes out a wash. But I sold 30 instead of the normal 15. Trying to see how think affects rank.

 

[jon.a]

On Cyber Monday I dropped one of my products to $7.99, sold each one at a $1.50 loss. Sold 87 of them. Jumped from page 6 to the bottom of page 1. After the holidays, I'm going to drop it back down to $7.99 again and leave it there until I'm top 1-3. I can afford to go months losing money on a product to rank it.

Let's say I sell 2000 a month and lose $3500 a month for 2 months straight. Assume that I rank at #1 afterwards. Then I raise my price back up to $20 and make $10 a sale. Now I'm selling only 1000 month (due to the price increase) and $10, making $10000 a month. I make my lost money back in 1 month.

You're giving away your good shit here!

 

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[DrkSide]

BTW, I'm trying something new right now where I drop my prices for a few hours during the day if sales are slow. I'm doing this so I get a steady stream of sales. Basically I sell 10 at profit, then 20 at a loss, the day comes out a wash. But I sold 30 instead of the normal 15. Trying to see how think affects rank.

Do you get people complaining on the price swings?

Let's say I sell 2000 a month and lose $3500 a month for 2 months straight. Assume that I rank at #1 afterwards. Then I raise my price back up to $20 and make $10 a sale. Now I'm selling only 1000 month (due to the price increase) and $10, making $10000 a month. I make my lost money back in 1 month.

I don't mind losing money on products to build rank. IF they are with organic/ppc orders. What I don't like were people coming into the market and giving away 500+ units for reviews through the review groups to launch the product. That is one of the reasons that I left the niche that I was in with my first product. It was just too competitive (I also didn't have near as much knowledge about it as I do my current one).

Right now I just launched a product on Thursday and have been getting 7-10 orders per day with no reviews. This is the first launch I have done where I didn't give 5 or so away immediately for review so I will see how it goes. I did price it right above break even so while I am not making money on it I am not losing money.

 

[Jake]

Just wanted to say thanks to @biophase and all who drop knowledge on the Amazon platform.

You don't get these sweet emails when selling books or apps

"Amazon.com has shipped the item you sold‏"

 

[biophase]

Do you get people complaining on the price swings?

Nobody has. In fact people who bought before just buy more when they go on sale.

The giveaways is just something you need to deal with. The silly thing is that it's harder to giveaway your product at $2 with coupon codes than it is to sell it at $8 to the public. And you lose more money and get shitty reviews. When I sell at $8 I get real non discounted reviews. And I don't expose my product to the rest of the Amazon sellers.

 

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[Wisith]

Infinite rep, Kenric. Can't wait to hear you drop some more gems in Feb. at the event.

Back at the mid way point of the thread, you mentioned about seeing the long goal and compare to NBA player blowing out his knee or something of that nature. When you first started, did you say to yourself "I'm not going to spend more than $x,xxx no matter what"? Obviously if you're new to this, you're going to be bootstrapping. Just not sure if you set a hard number for yourself or just went with the flow.

 

[biophase]

Infinite rep, Kenric. Can't wait to hear you drop some more gems in Feb. at the event.

Back at the mid way point of the thread, you mentioned about seeing the long goal and compare to NBA player blowing out his knee or something of that nature. When you first started, did you say to yourself "I'm not going to spend more than $x,xxx no matter what"? Obviously if you're new to this, you're going to be bootstrapping. Just not sure if you set a hard number for yourself or just went with the flow.

I didn't have a hard number at all. But remember I started in 2009 with 100 units. When those sold quickly, I think I did 500 on my next order. I was obviously more cautious during that time. Now, if my first 100-200 units sell quickly. I don't mind doing 1000-3000 on my next order.

In fact, my newest business I started in July, I wanted to bootstrap so I funded my first order with a credit card. But after getting hit with $500 in paypal fees, I decided to just fund it myself. So basically I started with a $1500 first order on a credit card then I added money into the LLC personally.

The product did well, so I placed a second $10,000 order and it's doing well. So I'm comfortable putting more money into it. There's no reason for me to keep bootstrapping if I have the funds. It's definitely a nice to have as I can move alot faster and lower my production costs.

 

[maniek00000]

Just wonder if anyone here is successfully importing to eastern European countries? At the moment dollar is very strong comparing to my currency. I checked approx. 50 items and there is no margins at all after adding shipping costs and taxes. Wandering if suppliers give me a higher price because of low asking quantity

 

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[Wisith]

I didn't have a hard number at all. But remember I started in 2009 with 100 units. When those sold quickly, I think I did 500 on my next order. I was obviously more cautious during that time. Now, if my first 100-200 units sell quickly. I don't mind doing 1000-3000 on my next order.

In fact, my newest business I started in July, I wanted to bootstrap so I funded my first order with a credit card. But after getting hit with $500 in paypal fees, I decided to just fund it myself. So basically I started with a $1500 first order on a credit card then I added money into the LLC personally.

The product did well, so I placed a second $10,000 order and it's doing well. So I'm comfortable putting more money into it. There's no reason for me to keep bootstrapping if I have the funds. It's definitely a nice to have as I can move alot faster and lower my production costs.

I may be having a brain fart here, but how did funding your first order with a credit card tie in with PayPal fees? I know they take a cut when you take a payment if the sender didn't mark as personal, but I only use it sparingly so I may be missing something. (PS starting with $1,500 isn't too shabby at all...did this include paying someone to do your logo and packaging and all?).

I was going to ask you about LLC as well: did you wait until your biz become profitable before incorporating it? If you're new then I guess you don't have much to lose. But at your level, it's a bit different. Let's say we found a way to improve a coffee mug to keep the liquid hot for a longer duration either by thickening the insulation around the mug or change the composition of it. A buyer becomes clumsy and spill some coffee on themselves and sustain a burn and want to take legal action. I'm sure this is really rare, but my mind is sort of trained to think like this because I deal with workers' comp and see some fraudulent claims.

Regarding logistics: when your shipment comes in, do you or your worker do random check for QA reasons to make sure everything is up to par prior to sending out to the customers?

Thanks as always!

 

[amp0193]

Do you get people complaining on the price swings?

I had a couple of these post Black Friday sale. I just refunded them the $6.00 diference and moved on.

 

[biophase]

I may be having a brain fart here, but how did funding your first order with a credit card tie in with PayPal fees? I know they take a cut when you take a payment if the sender didn't mark as personal, but I only use it sparingly so I may be missing something. (PS starting with $1,500 isn't too shabby at all...did this include paying someone to do your logo and packaging and all?).

When you pay China via paypal they charge 5% in fees. It may differ with factories, but there is usually a surcharge when you pay with a credit card.

 

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[1step]

I had a couple of these post Black Friday sale. I just refunded them the $6.00 diference and moved on.

I feel like sometimes customers forget the people on the customer service end are humans too... Some people talk to me like I am the biggest POS in the world. If I raise my price $20 overnight this is not an act of aggression on my part, I am not trying to threaten you. If you contact me and nicely ask for a discount I will give it to you. If you are a dick there is 0% chance.

I don't understand why some people cannot act like decent and polite human beings but if you can't I don't need or want you as a customer. /rant

 

[Wisith]

I have a friend that is looking into products that cost $200 wholesale, sell for $700 on Amazon. You can bet there is nobody else from an AMZ class doing that.

Funny you mentioned that. I do listen to Podcasts, usually during my drive to/from work..good way to kill 45 mins to 1 hour. A lot of them suggest to stay with products around $50-100, obviously going for higher volume here. In your friend's case...he would be an outlier and would be more likely to succeed. What you said about cookie cutter makes sense...the set it and forget it mentally. This thread is a reminder that there's more than 1 way to skin a cat.

 

[IGP]

This is a good read on how to use Amazon reviews in your copy writing and on your landing pages. The same exact principals can be applied when you are trying to make an existing product better! Enjoy!

https://copyhackers.com/2014/10/amazon-review-mining/

 

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[amp0193]

If you contact me and nicely ask for a discount I will give it to you. If you are a dick there is 0% chance.

I don't understand why some people cannot act like decent and polite human beings but if you can't I don't need or want you as a customer. /rant

It's tough, but on Amazon, I will completely take it up the rear and give in to any customer, no matter what, no questions asked. I'd rather have incredible metrics, and preserve the integrity of my selling account, then chance losing everything over sticking it to some dickwad. Been there, done that... not worth it.

Gotta play the game for now.

One day, I'll have a company that can have a customer service statement like Saddleback Leather's:

"We've found that about 99% of people who call or email in are courteous, kind, patient and respectful, even when there are legitimate problems. They value the dignity of the person and would never demean or devalue anyone by bullying them (yelling or cussing at them and making them cry after the phone call was over).

And then there's the 1% (who are going to send in angry bitter emails about this page). They yell and try to intimidate people (usually in hopes of getting something for free or discounted). They act or get angry at the littlest of things. Apparently, their parents didn't discipline them enough to teach them to always be kind, show respect and to esteem others as more important than themselves. These aren't the kind of people I want in the Saddleback family carrying around one of my bags. I only want good people who value what we value, representing us. "

 

[sWALK90]

In fact, my newest business I started in July, I wanted to bootstrap so I funded my first order with a credit card. But after getting hit with $500 in paypal fees, I decided to just fund it myself. So basically I started with a $1500 first order on a credit card then I added money into the LLC personally.

How do you avoid paypal fees?

 

[IGP]

20% conversion rate for people buying total. Can't distinguish where the traffic cones from. Just purchases divided by sessions.

@biophase If you use a custom URL shortner, you will at least be able to see how many people came from Instagram. It still won't tell you conversions, but it's a small piece of the puzzle.

 

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[Jay2]

Kenric, for your ecomm sites, what is the marketing strategy? google adwords, social media ad's? If you're not buying ad's now, how long/$ did you buy ad's? Also I believe you mentioned ~50% of your business is amazon & 50% ecom sites, do you plan to keep it this way?

 

[biophase]

How do you avoid paypal fees?

I wired the money over instead.