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NOTABLE! My opinion of the Amazon Marketplace

CigarMan

Bronze Contributor
Mar 24, 2013
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If you sell someone else’s brand you have no control and no exit strategy. Even worse considering you are talking about selling on amazon. This is not a business it’s just a hustle to make a bit of money.

If you want to sell branded products the way to make money would be to create your own website that sells branded products along side your own private label products and use the branded products as a break even or loss leader to get people to buy the private label products. This is actually what most big box stores and supermarkets are doing now and they are doing it for a reason. Buying from a brand you have to add thier margin in so how could it ever be as profitable as private label. “They have spent the money/margin on marketing and branding” you might say “so that’s worth the extra markup”. That’s true but even more of a point for you to build your own brand. All the extra money you spend on thier markup is being invested into thier brand and they will get it back when they sell the company. So why not invest it in your own company.
Eventually I will start a ecommerce site. It will help with opening new wholesale accounts.

My business won't depend on any product or brand. In fact I expect products to go in and out of profitability and will use software to monitor that. The name of the game is gaining access as many branded products as possible... if 0.5 to 1% of those items are viable on amazon at any given time then it is just a numbers game.

I agree this is a hustle but there are also companies making 8 and 9 figures doing this. The exit plan is simple... sell the business.
 

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richm21

PARKED
May 11, 2015
2
0
3
It's no secret that Amazon's FBA marketplace has changed dramatically in this year. One of the reasons that I've decided not to do my coaching again in 2019 is because I feel that it is very hard to get a new product launched now, solely on Amazon. I feel that the strategy for launching has changed and now requires a more complex approach.

Just as an example, one my clients from Jan 2018 picked a niche within a niche. We are talking something that was very targeted. Think something like wallets made from ostrich feathers. When we looked at the niche, there were 3 competitors in Feb 2018. Now there are at least 6. This niche is so small, that a paranoid person would think that either I or my client told people about this niche in February. How else do 3 competitors show up in something so unusual? My answer is, it's because everyone is in Amazon and trying to do the same thing that you are doing. If you are thinking about a fidget spinner made of knives, somebody else probably has the same idea.

So, what do you do now? Well, in my opinion, you can no longer launch a product on Amazon, you must launch a brand. You cannot think short term, you must think long term. You must have a much longer timeframe and a built out strategy that includes marketing outside of Amazon.

Gone are the days of a one product launch.

So this is how I plan to do my future launches. First, you still need to find a decent product. That's still a given. But if all you do is find a decent product, chances are, others have found the same one. So when you launch, you are a handful of others are in the same boat.

I'm going to use backpacks for the remainder of this post to illustrate my example. Let's say I'm selling a new school backpack. I make a slightly new design in black color with a brand name STRIDER.

When this goes live on Amazon, your backpack is going to be seen right along side a dozen other black school backpacks. Your backpack may be different and better, but how will people know it's cool features without clicking onto your listing?

First, your listing needs to be seen. This means PPC for the newly launched product.
Second, your listing needs to convert. This means getting reviews.

You will quickly find out how expensive PPC is and how difficult getting reviews are now.

In the old days, you toss up a PPC campaign and send out review emails. You could even decide to use a review group if you get desperate.

So here is how I would do it. First, I would launch multiple colors, I would do a black, blue, gray STRIDER backpack. I would give the backpack a name, like the STRIDER CLASSIC backpack.

Then I would launch a STRIDER TRAX messenger bag in blue, black & gray
Then I would launch a STRIDER LIFER shoulder sling in brown, gray & blue

Now I've got 3 products in a similar niche. I can create an IG and FB page for STRIDER BAGS. With 3 products in different colors, I can make decent content of people using my bags, put in some lifestyle posts.

I would create a Shopify store to sell the products. 3 products is probably enough to make a decent looking store.

I would drive traffic from IG, FB to either the store or Amazon. I'd run some Google PPC to the webstore and do some Amazon PPC.

If you look at the overall picture now, a new customer that stumbles upon Amazon, Shopify, IG or FB, would see a consistent brand. They'd see STRIDER as a new brand they just discovered that sells some pretty cool bags. Can you guys picture this in your head? Can you picture what the Shopify page would look like? The IG page with dozens of photos? The FB page with 1000 likes a photos? This is what I mean by launching a brand.

This new customer, if they like your stuff will probably go onto Amazon and search for it. They will type in STRIDER backpack and click and buy YOUR backpack. This is how you will get your sales and eventually reviews.

You envision the whole brand from the start and then execute it. It's very different than, junglescout says that the top seller of black backpacks is doing $150k a month. I can get one for $10 on Alibaba and sell it for $50. Now who wants to sell backpacks!!!
Did anyone listen to the most recent Tim Ferris podcast with the 2 guys selling on Amazon:
How to Generate 8-Figure Revenue at Age 21 (Or Any Age) — Real 4-Hour Workweek Case Studies (#354)

As someone who has done Amazon FBA I find it hard to get my head around how they launched over 20 skus at once without taking on any outside investment. They say that the terms they got from their Chinese suppliers allowed them to scale. Any thoughts?
Its quiet an informative podcast about 2 guys who are scaling out fast and just using Amazon.
 

Walter Hay

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This is what they should have told you on their podcast:

Alibaba offer two sources of credit for purchases on their platform:

PayLater is open line of credit finance up to $150,000 provided by Kabbage at a rate that starts at 15% p.a. To help attract careless buyers, they advertise it as "Fees starting at 1.25% per month. Maximum loan duration is 6 months, so theoretically the amount of interest you would pay for the duration of the loan works out at 7.5%.

It can only be used for minimum purchases of $5,000 and must be covered by Alibaba's Trade Assurance scheme. To learn how ineffective that "assurance" can actually be, either read my detailed 2 page explanation in sub-chapter 8.2 of my book, or you can read the 16 pages of Alibaba's rules and regulations plus the many other essential rules that can only be found in their help section.

e-Credit Line is another open line of credit finance up to $500,000. It is funded by Alibaba. Maximum loan duration is 12 months. The current interest rate they quote is: "From 0.87% per month," but if you do some searching you will find that it can be up to 1.3% per month. You will also pay an additional drawdown fee of 1.5% of the amount you borrow each time you use funds for purchases.

It is almost impossible to obtain credit terms from suppliers in China. I achieved the impossible when my suppliers agreed to allow me monthly terms, with no interest and no fees. That was a result of establishing strong relationships, built on their appreciation of my ethical standards, together with frequent visits. My franchisees automatically enjoyed that benefit, and I have since shown my book readers the key to getting such an account.

I never borrowed to operate my business. Growth was funded from my huge profit margins.

Walter
 

Greg R

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I don't know how I just saw this thread.

To add on to the other 63 posts...

I've recently seen first hand, and can affirm pretty much everything in this thread.

Here are some other observations from my own experience.

Up until Q4, my website was my main source purchases. November came, and that completely did a 180 and flipped to Amazon. Before that I saw people go to my website first, and then buy from us on Amazon. Even though it is the same price, I think there is a trust factor so Amazon acts a another net to catch your customer. To add on to that, I now know where to allocate my advertising spending next year.

We recently did a new product launch on Amazon with some success. BUT it is unbelievably hard to get reviews organically. We are on the second page for our keyword (now) but the amount of reviews still lack. I have no doubt in my mind that if we can get more reviews, we would be on the first page.

Speaking of the new product, I launched it knowing that it would be a success on Amazon AND I also launched it knowing that it would be a success on other channels (such as subscription boxes, retail, and our website). I think the important point here is to make sure you manage your risk by making sure your new product can be a success across multiple channels.

A question to ask yourself:

Do you want to go big with a real business or do you want to have a hamster wheel lifestyle business?

You can tell me I'm wrong, but Ecommerce can be summed up to into one channel with multiple sub channels. Other major channels are alive and well. If your product is a success online, chances are you are missing a huge opportunity to get into other high volume channels. The type of channels where 1 hour of work can net you a huge sale.

A lot of people do not figure customer acquisition costs into the equation. Not only is Amazon PPC expensive, but it is expensive everywhere. This is even more of a reason to cast a wider net and allocate your ad spend across a calendar year wisely.

Finding creative ways to lower your cash outlay is also key to making the gears turn. One option for this is to plan a product line that uses similar materials. This makes it easier for your manufacturers to say yes to combining an entire product line into a one-product MOQ. Very recently, we have discovered a way to get big sales without investing in large MOQ orders. We are going to double down on this.

I guess my overall message here is that if your long term plan is to only be an ecom company, you are risking a ton of opportunity cost. People can dispute this all they want and say that "this doesn't apply to their business." This kind of small thinking is what will keep you small. JMTC.
 
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biophase

biophase

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Did anyone listen to the most recent Tim Ferris podcast with the 2 guys selling on Amazon:
How to Generate 8-Figure Revenue at Age 21 (Or Any Age) — Real 4-Hour Workweek Case Studies (#354)

As someone who has done Amazon FBA I find it hard to get my head around how they launched over 20 skus at once without taking on any outside investment. They say that the terms they got from their Chinese suppliers allowed them to scale. Any thoughts?
Its quiet an informative podcast about 2 guys who are scaling out fast and just using Amazon.
I'm guessing that if they could convince a factory that they will be successful that I can see factories doing this. My factories give me good terms now, but if I said that I could 10x my business and their business by them giving me 180 day after delivery terms, I think they would do it based on my track record with them.

I think it would be hard to convince a factory of this on your first or second order though.
 

richm21

PARKED
May 11, 2015
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0
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I'm guessing that if they could convince a factory that they will be successful that I can see factories doing this. My factories give me good terms now, but if I said that I could 10x my business and their business by them giving me 180 day after delivery terms, I think they would do it based on my track record with them.

I think it would be hard to convince a factory of this on your first or second order though.
The best terms I have been able to secure has been net 30 days. Do you think 180 days is possible?
How would you best propose this to them?
 

vshetty.vs

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So, what do you do now? Well, in my opinion, you can no longer launch a product on Amazon, you must launch a brand. You cannot think short term, you must think long term. You must have a much longer timeframe and a built out strategy that includes marketing outside of Amazon.
Not sure if this is what you're talking about, but Lebron and his trainer just launched a company called ladder fitness. Now I knew Lebron was a great marketer( you don't make 800M without know how to get endorsements), but the branding on their product honestly blew me away.

Just some context: Ladder provides supplements and protein powders for athletes(Pretty niche market, which is what got my attention). They are more expensive than your traditional Protein powder but they are certified by the national sports federation and made exclusively for athletes.

They have leveraged some celebrity endorsements and created a website but also maintained a blog, created a social media following and even built an email list all before launching a single product.

Ladder is not positioned as just another protein powder; they are a brand with a mission - helping athletes perform their best. It just so happens that the easiest way to do this is by creating NSF certified supplements.
 

Guts

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"the ad money we spend will be aimed at creating conversions within IP that we own and control, and ultimately the brand will be much more healthy as a result of being forced to be profitable from day one."

Hey @Vigilante , what do you mean by IP? Are you referring to IP addresses or is it an acronym for something else? Thanks!
 

LittleJohn

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"the ad money we spend will be aimed at creating conversions within IP that we own and control, and ultimately the brand will be much more healthy as a result of being forced to be profitable from day one."

Hey @Vigilante , what do you mean by IP? Are you referring to IP addresses or is it an acronym for something else? Thanks!
IP is intellectual property.
 

DaDream

Contributor
Apr 24, 2019
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56
110
Miami Florida
It's no secret that Amazon's FBA marketplace has changed dramatically in this year. One of the reasons that I've decided not to do my coaching again in 2019 is because I feel that it is very hard to get a new product launched now, solely on Amazon. I feel that the strategy for launching has changed and now requires a more complex approach.

Just as an example, one my clients from Jan 2018 picked a niche within a niche. We are talking something that was very targeted. Think something like wallets made from ostrich feathers. When we looked at the niche, there were 3 competitors in Feb 2018. Now there are at least 6. This niche is so small, that a paranoid person would think that either I or my client told people about this niche in February. How else do 3 competitors show up in something so unusual? My answer is, it's because everyone is in Amazon and trying to do the same thing that you are doing. If you are thinking about a fidget spinner made of knives, somebody else probably has the same idea.

So, what do you do now? Well, in my opinion, you can no longer launch a product on Amazon, you must launch a brand. You cannot think short term, you must think long term. You must have a much longer timeframe and a built out strategy that includes marketing outside of Amazon.

Gone are the days of a one product launch.

So this is how I plan to do my future launches. First, you still need to find a decent product. That's still a given. But if all you do is find a decent product, chances are, others have found the same one. So when you launch, you are a handful of others are in the same boat.

I'm going to use backpacks for the remainder of this post to illustrate my example. Let's say I'm selling a new school backpack. I make a slightly new design in black color with a brand name STRIDER.

When this goes live on Amazon, your backpack is going to be seen right along side a dozen other black school backpacks. Your backpack may be different and better, but how will people know it's cool features without clicking onto your listing?

First, your listing needs to be seen. This means PPC for the newly launched product.
Second, your listing needs to convert. This means getting reviews.

You will quickly find out how expensive PPC is and how difficult getting reviews are now.

In the old days, you toss up a PPC campaign and send out review emails. You could even decide to use a review group if you get desperate.

So here is how I would do it. First, I would launch multiple colors, I would do a black, blue, gray STRIDER backpack. I would give the backpack a name, like the STRIDER CLASSIC backpack.

Then I would launch a STRIDER TRAX messenger bag in blue, black & gray
Then I would launch a STRIDER LIFER shoulder sling in brown, gray & blue

Now I've got 3 products in a similar niche. I can create an IG and FB page for STRIDER BAGS. With 3 products in different colors, I can make decent content of people using my bags, put in some lifestyle posts.

I would create a Shopify store to sell the products. 3 products is probably enough to make a decent looking store.

I would drive traffic from IG, FB to either the store or Amazon. I'd run some Google PPC to the webstore and do some Amazon PPC.

If you look at the overall picture now, a new customer that stumbles upon Amazon, Shopify, IG or FB, would see a consistent brand. They'd see STRIDER as a new brand they just discovered that sells some pretty cool bags. Can you guys picture this in your head? Can you picture what the Shopify page would look like? The IG page with dozens of photos? The FB page with 1000 likes a photos? This is what I mean by launching a brand.

This new customer, if they like your stuff will probably go onto Amazon and search for it. They will type in STRIDER backpack and click and buy YOUR backpack. This is how you will get your sales and eventually reviews.

You envision the whole brand from the start and then execute it. It's very different than, junglescout says that the top seller of black backpacks is doing $150k a month. I can get one for $10 on Alibaba and sell it for $50. Now who wants to sell backpacks!!!
Hey @biophase. I seen tons of great stuff from you. Third day in here. I wanted to share this video and get some thoughts from you:

View: https://youtu.be/pBffKzWECUQ
 

Walter Hay

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We see in @vshetty.vs post an example of the effect of excellent copy, clever website design, and the power of perception. Just don't look at the copy too critically and note the contradictions, or like skeptical me, you will find that this is just another brand fueled by influence.

It's very cleverly done, and I expect its emotional appeal will lead to great success.
Ladder provides supplements and protein powders for athletes(Pretty niche market, which is what got my attention). They are more expensive than your traditional Protein powder but they are certified by the national sports federation and made exclusively for athletes.
Well they have certainly convinced you. How many athletes are there in the USA? How many in the world?

If these products are made exclusively for athletes, that would mean customers would have to prove that they are athletes in order to qualify as purchasers.

You musn't have noticed that on their homepage they say: DESIGNED FOR ALL LIFESTYLES. Nothing exclusive about that, and nothing niche about that.
Ladder is not positioned as just another protein powder; they are a brand with a mission - helping athletes perform their best. It just so happens that the easiest way to do this is by creating NSF certified supplements.
It is just another protein powder, but it is marketed in a way superior to the average. As for a mission, that is a common way to try to disguise the real mission - making money.

Their mission involves a whole lot more than simply creating NSF certified supplements, as their three pillars statement confirms.

Walter
 

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Xeon

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Just don't look at the copy too critically and note the contradictions, or like skeptical me, you will find that this is just another brand fueled by influence.
....How many athletes are there in the USA? How many in the world?
You musn't have noticed that on their homepage they say: DESIGNED FOR ALL LIFESTYLES. Nothing exclusive about that, and nothing niche about that.
Their words really does seem contradictory.
So, by making it look as if it's "for athletes, by athletes", and yet saying "for all lifestyles", what they're doing is to associate their products with athletes to make it seem like they're better than the rest, while the "for all lifestyles" part helps them to rake in as much of a customer base as possible?
 

DURABLEOILCOM

New Contributor
Oct 25, 2012
38
10
17
It's no secret that Amazon's FBA marketplace has changed dramatically in this year. One of the reasons that I've decided not to do my coaching again in 2019 is because I feel that it is very hard to get a new product launched now, solely on Amazon. I feel that the strategy for launching has changed and now requires a more complex approach.

Just as an example, one my clients from Jan 2018 picked a niche within a niche. We are talking something that was very targeted. Think something like wallets made from ostrich feathers. When we looked at the niche, there were 3 competitors in Feb 2018. Now there are at least 6. This niche is so small, that a paranoid person would think that either I or my client told people about this niche in February. How else do 3 competitors show up in something so unusual? My answer is, it's because everyone is in Amazon and trying to do the same thing that you are doing. If you are thinking about a fidget spinner made of knives, somebody else probably has the same idea.

So, what do you do now? Well, in my opinion, you can no longer launch a product on Amazon, you must launch a brand. You cannot think short term, you must think long term. You must have a much longer timeframe and a built out strategy that includes marketing outside of Amazon.

Gone are the days of a one product launch.

So this is how I plan to do my future launches. First, you still need to find a decent product. That's still a given. But if all you do is find a decent product, chances are, others have found the same one. So when you launch, you are a handful of others are in the same boat.

I'm going to use backpacks for the remainder of this post to illustrate my example. Let's say I'm selling a new school backpack. I make a slightly new design in black color with a brand name STRIDER.

When this goes live on Amazon, your backpack is going to be seen right along side a dozen other black school backpacks. Your backpack may be different and better, but how will people know it's cool features without clicking onto your listing?

First, your listing needs to be seen. This means PPC for the newly launched product.
Second, your listing needs to convert. This means getting reviews.

You will quickly find out how expensive PPC is and how difficult getting reviews are now.

In the old days, you toss up a PPC campaign and send out review emails. You could even decide to use a review group if you get desperate.

So here is how I would do it. First, I would launch multiple colors, I would do a black, blue, gray STRIDER backpack. I would give the backpack a name, like the STRIDER CLASSIC backpack.

Then I would launch a STRIDER TRAX messenger bag in blue, black & gray
Then I would launch a STRIDER LIFER shoulder sling in brown, gray & blue

Now I've got 3 products in a similar niche. I can create an IG and FB page for STRIDER BAGS. With 3 products in different colors, I can make decent content of people using my bags, put in some lifestyle posts.

I would create a Shopify store to sell the products. 3 products is probably enough to make a decent looking store.

I would drive traffic from IG, FB to either the store or Amazon. I'd run some Google PPC to the webstore and do some Amazon PPC.

If you look at the overall picture now, a new customer that stumbles upon Amazon, Shopify, IG or FB, would see a consistent brand. They'd see STRIDER as a new brand they just discovered that sells some pretty cool bags. Can you guys picture this in your head? Can you picture what the Shopify page would look like? The IG page with dozens of photos? The FB page with 1000 likes a photos? This is what I mean by launching a brand.

This new customer, if they like your stuff will probably go onto Amazon and search for it. They will type in STRIDER backpack and click and buy YOUR backpack. This is how you will get your sales and eventually reviews.

You envision the whole brand from the start and then execute it. It's very different than, junglescout says that the top seller of black backpacks is doing $150k a month. I can get one for $10 on Alibaba and sell it for $50. Now who wants to sell backpacks!!!
What is your opinion about selling on Ebay, OfferUp, Letgo, Mercari, and Craigslist?
 

Jacoles

PARKED
May 7, 2019
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Hi.
First of all many thanks to you @biophase for this valuable thread and knowledge you are sharing. Reading this forum gave me more info regarding Amazon and Ecommerce than most of yt content.

I have a quick question for you. I found a product that can be improved significantly, something that all customers complain about but non of sellers want to implement.

The issue is that one seller is quite big 2000+ reviews and the product is seasonal (in summer sells great but in winter time so-so). I want to jump anyway into this niche but wondering about right timing.

Based on your experience, would you start within few weeks in autumn 2019 or would you wait for new season, March 2020 preferably? What I am afraid is that if I start now, my competitors will have time to copy my solution, produce product and be ready with such innovation for peak season in 2020. Basically I am afraid to loose element of surprise.

What would you do?
Thank you in advance for your feedback.

Jack
 
Last edited:

vulcansx

New Contributor
Mar 9, 2013
11
6
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29
Toronto, ON
Amazon is still doable but it's 10x harder then it was in 2013, I wish I had the capital I have now back then.
Canada and Europe are still our most profitable markets, with plans to launch in Australia once the customer base is there as well as trust worthy prep centers. A lot of people don't realize that you can list in 5 European countries from 1 Amazon warehouse in the UK.

However I agree that I no longer think Amazon is worth the time if you are starting from scratch, their are better business models.

In 2019 I'd do a Shopify and build up a brand, promote with influencers, paid ads anything. Shopify brands are worth higher multiples when you sell and generally make higher margins.

Our Amazon still does mid 7 figures so we are commited.. but it's insanely competitive now and I don't recommend going against the grain when theirs so many businesses that are growing instead of shrinking.
 

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