#300 - Mistakes Experienced Sellers Make Launching Products & Building Teams with Tomer Rabinovich

#300 - Mistakes Experienced Sellers Make Launching New Products & Building Teams with Tomer Rabinovich Speaker 1: In this episode of the AM-PM Podcast, I speak with Tomer Rabinovich. Tomer is one of the leading experts and one of the smartest people I know in this space. He and I are going to be talking about everything from some of the big mistakes that advanced sellers make in launching new product lines, talking about growing your business, talking about all kinds of really cool stuff. Going to get a lot from this episode, so I hope you enjoy it. Unknown Speaker: Welcome to the AM-PM Podcast. Welcome to the AM-PM Podcast, where we explore opportunities in e-commerce. We dream big and we discover what's working right now. Plus, this is the podcast where money never sleeps. Working around the clock in the AM and the PM. Are you ready for today's episode? I said, are you ready? Let's do this. Here's your host, Kevin King. Speaker 1: Welcome to episode 300. That's right, 300. It's like a magic number. And who do I have today? But the magician, the magician of Amazon is on the podcast today. Tomer Rabinovich. Tomer, how are you doing, man? Speaker 2: Very good, Kevin, how are you? Speaker 1: I'm awesome. So you're sitting over in Israel, is that correct? Speaker 2: Yeah, that's right. Speaker 1: So you're one of those Amazon sellers. There's a huge community in Israel of Amazon sellers. A lot of people don't realize how many sellers are actually based over there. Speaker 2: Yeah, yeah, that's very true. I think Israelis in nature are like hustlers. You know, everyone has some sort of a business on the side here. Speaker 1: That's true. I mean, I think it's just part of the culture there. What's 7, 8 million people or something like that in Israel? And it's like everybody's involved in business. Speaker 2: Yeah, yeah, exactly. Yeah, pretty much. I think like if you have two parents with three kids, which is average, working full time, it's like not enough money. So that's why everyone just trying to find some more streams of income, I guess. Speaker 1: Yeah, it's amazing how many hard-working people come out of Israel. I mean, the high-tech stuff over there, so Amazon's like a natural fit. You've been doing this Amazon thing for a day or two. How did you actually get started? Was it like 2014, 2015, something like that when you started doing this? Speaker 2: Yeah, yeah, exactly. I started with a course pretty much like everyone else at that time. Started selling at 2015. I think it was like March 4th, 2015 was my first sale. You never forget your first, I guess. Been doing that for like seven years now. For the past few years, I've been consulting mainly bigger sellers, like seven, eight-figure sellers. For the past two years, I've been involved with some of the aggregators in the industry as well. Yeah, spoken at pretty much every major event out there, been to your event, which was awesome twice. Yeah, been all over the place. Speaker 1: And you're still selling today. You're still running, you still have a company selling on Amazon in addition to all the consulting and speaking and everything else you're doing. True. Yeah. Speaker 2: I have four different brands running right now in different categories. I kind of started all of them when I pretty much started out because I kind of found more opportunities. So I just opened more brands up. But then I decided to just stop and just focus on those four and not kind of expand further. Speaker 1: So you've gone from starting by yourself pretty much or did you have partners when you first started back in 2015? Speaker 2: I didn't have any partners. I did kind of partner. I had an investor. I had a partner in another brand. I had a few things kind of going. I ditched all of them probably after 6 or 12 months. I honestly found out I'm not a very good partner, I guess. I'm better doing things on my own in terms of like partnerships and stuff. Every partnership I had kind of fell through over the years, I guess. And I always found like I'm working the hardest, but I guess that's what a lot of partners feel like over time, that they are the ones working more. But yeah, just doing it on my own with a small team in the Philippines, running most of it on their own at this point. Speaker 1: So is it just you and the team in the Philippines or do you have some people working in Israel with you as well? Do you have an office or is it work from home or what's your situation like? Speaker 2: Yeah, so it's just me. I have seven people in the Philippines. I have a small team in Israel for the consulting business. All of us are working from home. We meet like once a quarter physically and that's it. Speaker 1: Awesome. So yeah, we'll talk about that a little bit about how you've actually scaled from just you to putting together the right team. Because if you're doing it efficiently with a small team like that, you've done something right. Because a lot of people, they overexpand, they get too many people. But if you're doing it that efficient, that's something we definitely will touch on and just a little bit on systems and scaling. So right now you're heavily, in addition to the selling, I know you're advising a couple of the top aggregators in the space and you're like pretty heavily involved. It's not just like pick up the phone and give them some advice every once in a while. It's like you're actively involved. Is that correct? Speaker 2: Yeah, what happened was I guess like aggregators were talking to a lot of Amazon sellers to acquire their businesses and some of them mentioned my name, you know, like bigger sales that were acquired or just talking to. And then those aggregators just reached out to me. I didn't plan on it or try to reach out to them myself. They just reached out to me. And basically I demanded equity, like without equity I don't, I didn't see it being beneficial for me to kind of give them the keys to everything that I know. So I basically asked for equity from the get-go and some of them said no, but some of them said yes. So I've been working with some of them very closely and the way I kind of see it is I prefer to run in sprints. So I prefer to just work with an aggregator for a few months, get some equity, get them going. And then just kind of move on with some other projects and not being like tied up to one specific aggregator, one specific company and kind of distribute my equity in different aggregators, I guess, and also different companies. Speaker 1: So these are all shorter-term things. It's not like long-term contracts. Speaker 2: Nothing too long-term, I guess. The longest was a six-month project with one specific aggregator. Sorry, another one was a year, I guess, so that's a bit longer. But yeah, nothing longer than that. And we always start with like two to three hours a week, and then it kind of grows from there if we need to grow it. Speaker 1: So what kind of advice are they typically coming to you? What are they missing? What's hard for them to get that they need to come to an expert or someone with your experience to get? Speaker 2: Yeah, so one of them was kind of just ramping up, just kind of hiring people and they kind of helped train up the brand managers that they had. As you and I both know, they mainly hire people that have no Amazon experience, maybe some e-commerce, maybe some marketing, e-commerce in general, whatever, but it's nothing Amazon specific usually. So I helped train the teams. And then I also helped the M&A team looking at brands, telling them what I think if they should acquire them, not acquire them. And they helped a bit on systems and processes as well. A different aggregator helped build up their pod development system and team from scratch. So that was a big project. And I can say that I think most of the aggregators don't really realize that the best way to grow a brand is to launch products to that brand. Like if you think of any major company, it doesn't matter what company it is, if it's McDonald's or Apple or Tesla or whatever, they all launch products. And that's the best way to grow a brand and not just expand globally, acquire more brands, going into retail, Shopify, like all that is nice, but you still need to launch products. The next product can double your business, right? Triple your business. So I think some of them realize that that's what they need and they really focus on product development, but a lot of them don't really do that. Speaker 1: Yeah, most of them don't do that. I mean, there are some, like we work with some with products, Savants and our product Genesis deal that Steve Simons and I do, but they don't realize that, like you just said, that is a key. They've got to expand what they have, not just keep adding to it with other brands. And some of them, I think, kind of get lost on that. What other things do you see, like having such a close relationship with some of these aggregators, have you seen that are big stumbling blocks for them, that they're really having trouble? Is it hiring really good, qualified people? Like you said, most of them have no Amazon experience. They might have e-commerce experience, but that helps, but it's totally different. Or what other big issues do you see just by being on the inside of some of these without naming any names? Speaker 2: Yeah, I think the big issue that I saw like over the years is that when they acquire like a $1 million, $2 million, $3 million brand in revenue, and they do that at scale, like acquiring 30 of those brands, it's very difficult to manage those and scale those properly. So I think the bigger aggregators, I would say better aggregators, realize that they should acquire bigger businesses. So actual brands that are already doing well, like a $10 million, $20 million brand, And that's we it's kind of like launching products. So if I think about launching products, I should launch One product that will do 50k a month, then launching five products that will do 10k a month each, because it's a lot easier to manage one product, you know, than five products. So, obviously, you want to start with those five products to get to 50k a month, and then you have the cash flow, you have stability, and your first product shouldn't be a 50k a month product. You should start with some sort of a baseline, and then you can go after bigger fish. And I think the aggregators should work the same way. They should acquire some smaller brands to kind of get the ropes and everything and understand how everything works. And then they should go after bigger fish out there that can really stabilize their business and have a strong base to their business. Because taking a $3 million brand to $30 million is a lot easier than taking 10 $1 million brands to $2 million each. You know what I mean? Like, it's just a lot easier to grow a bigger brand and getting that into retail, getting that global expanded and it's just a lot easier to do. So, also, one other thing they do as well, these aggregators, is they actually keep the sellers with them if they have a bigger brand with their teams and they let them run their business for another year or two while they integrate their own systems into that bigger brand. And I think that is a very smart move as well on their end. Speaker 1: But one of your skills is actually product development, product, you know, finding those opportunities based on the keywords and you have a whole system that's really, really good. It's one of the best out there for actually doing product discovery and keyword research and everything. So why not actually sell one of those four brands and like you said, you don't need the cash, but there is a big payday that comes with that and you could get ahead of the game by getting some leverage and then start again. Why not do that? Speaker 2: Yeah, so the way I see it, I just wrote a book as you know, and the way I see it, I have a few years still in this game. ...called Amazon. So, I'm not kind of rushing anywhere and I don't really want to start a new brand from scratch. Like, I have everything ready, like, why should I start a new brand? It's a lot easier to launch a product for an existing brand than to start a new brand from scratch. Opening a new Amazon account with all the restrictions it has and everything, like, my accounts are fully open, like, I don't see a real reason to kind of sell a brand at the moment, especially now, right? But probably, like, at some point, like, a year or two from now, I'll probably exit one of those. Speaker 1: So how long do you see yourself? You just said on this Amazon game you see yourself just a few more years. Is that your goal? Is it just to keep doing this for another couple years and then exit and go raise your family and retire on the beach or you see yourself doing this for a while? Speaker 2: Yeah, honestly, I don't think any of us know what's going to happen with Amazon, with Walmart, with Shopify. It's all very interesting, it all changes all the time and it's a lot of fun and e-commerce is still probably the very beginning. It's what, 10% of commerce in the US or something? It's still relatively low. So, I think it's going to grow, but the way I also see Amazon, it just gets more and more difficult, more and more competitive over time. It's not getting any easier, right? So, it is getting more difficult with the aggregators throwing in a lot of money, Chinese sellers going and doing some crazy stuff. So, all of that is just making our lives more difficult. So, I'm not saying it's all going to end tomorrow, but I don't know what will happen in five years' time. Speaker 1: What did you do before this Amazon, this e-commerce stuff? Were you involved in some other kind of e-commerce? What's your background before selling on Amazon? Speaker 2: So I used to be a full-time magician before I did any of this stuff. And right after college, I worked for this company full-time that is basically helping small businesses to grow. And at the same time, I started Amazon. So that was my first and hopefully only real day job that I had. And yeah, that's pretty much it. And you know, in Israel, I also served in the military for three and a half years in intelligence. That's where I learned about spreadsheets and stuff like that. But yeah, that's pretty much my background. Speaker 1: It's mandatory in Israel, right? When you come out of high school or something, you have to do what? One year? Two years? What's the mandatory? Speaker 2: Guys need to do three years and women need to do two years. It changed a bit, but yeah, it's basically two years. Speaker 1: Cool. You said earlier that Amazon's becoming more and more difficult to sell. And I know you just wrote a book and stuff where you're talking about a whole bunch of everything about Amazon. We'll talk about that here in just a second. But why would a new person want to get into Amazon right now? If I'm new and I just saw some YouTube video or I just saw some course or I saw the Freedom Ticket or saw you speak on stage, like this looks like a good opportunity. What do I need to keep in mind now that I would not have had to know or keep in mind a few years ago? Speaker 2: Yeah, so now I think there is just a lot more you need to know. Like a lot more information you need to know before you can actually start and you probably need more money upfront. You cannot start with like 1, 2, 3k investment in your inventory as you did before. You probably need a bit more than that. You know, you probably need like 10, 20, 30, 50k in the bank to kind of start this business properly and give yourself a chance to succeed because if the first product fails, It doesn't mean you should stop there. That's kind of your, that's the learning curve, right? So what I always say is that if you want to go into this business, you should aim for three products because if you fail with the first two, the third one is probably going to be some sort of successful, you know, in the third one. So I think it's just like a lot more knowledge that you need up front. And again, everything is more competitive. Like everyone now have good images, good listings overall, pretty good products. Like you need a better product. That's the number one rule in this business, right? You cannot launch exactly the same product as everyone else has on Amazon and expect you to do better than there. So I think that's the number one thing. And if you have a good product, everything else will kind of fall into place. You don't need to be a PPC expert. You don't need to be SEO expert or anything like that. You just need to have a good product to begin with. And I think also Amazon shoppers at this point are a lot smarter about how they shop. They can recognize a better product. You know, even if it doesn't have better images or whatever, they can recognize something that is actually a better quality. I have a family in LA, in the US, and I remember sitting down next to them just to see how they buy because they have like multiple shipments coming in every day to their house. And it was just very interesting to just see how quickly they buy, you know. Speaker 1: So what are some of the things that you see like watching your family or that you observe that the Amazon buyer now is more sophisticated? What are they doing that's different or how are they analyzing a listing as a buyer? Speaker 2: I can honestly say I think each of them is doing it differently. I think all of them look at all of the images. They don't really skip any of the images. They probably don't really read much on the listings. And they also, on each product, they're going to open three, four different listings to make a decision. They're not going to open probably one or two. Again, it depends on the product, right? One of my favorite questions to ask sellers I consult is, what do you think is a good conversion rate? Is it 10% or is it 50%, right? And they say whatever and then I say, well, it depends on the product. If you sell disposable cups, for example, it's like a party thing, whatever you click on, you buy, right? You don't really care about, you need 100 cups for a party, you're just going to buy anything. But if you sell a very personal thing like a diaper bag, even though it's not necessarily very expensive or anything, it's just a big range of different prices, different designs. It's a very personal thing. You buy it for your baby and maybe multiple babies over the years. So, it's a very personal purchase and also, The price reviews and the main image are not enough to make a decision. You actually have to go to the listing, see all the images, maybe read the bullet points, read some reviews to make a decision. So even though a diaper bag might seem like a good opportunity on Amazon to sell, actually probably none of them are making any profit because you need to get so many clicks to get a sale for this product. Speaker 1: Do you see that matters more on price point too, where people are analyzing more the higher the ticket price and the lower price items, like does it matter, more commodity type of stuff? Speaker 2: That obviously affects it. I kind of, on purpose, I gave an example where you have a relatively cheap product like a diaper bag, but it's still like a low conversion rate, but usually a higher price is going to be a lower conversion rate for sure. Speaker 1: And you see a lot of times too where listings that have really high conversion rates, if someone has a really high conversion rate on their diaper bag that's way above the norm, 50-60% or something, that probably means they're just not getting many sessions. Usually you'll hear people sometimes on Facebook say, oh yeah, I've got 60% conversion rate or session percentage or whatever, and I'm like, well, how many sessions are you actually getting? Speaker 2: Yeah, so what they say, that's funny, they say, oh, I have 60% conversion rate, I need outside traffic. You know, that's what they say. I have like 60% commission on Amazon. I need outside traffic. I'm like, no, you need to fix your listing or get more reviews. That's what you need to do now because you're not getting enough sessions. The fact that you are on page 5, if someone got to page 5 and clicked on you, got a session, they are much more likely to buy your product because they couldn't find what they were looking for in the four pages before you. But high conversion rate is only really high if you're on page 1. If you're not on page 1, it's not really high. Speaker 1: Exactly, exactly. Now, I remember we were at the Helium 10 Elite event. Back then it was called Illuminati in Hawaii. This was, I guess, was it like January of 2018? You were a speaker and that's, I think, when I first met you. And you were talking about one night I think where everybody had been at the bar drinking or something and it's like 11 o'clock at night, people were going to bed. I remember you were holding court like in this like little lobby area where it's like you were just there and there's like 10 people on these couches just all around you just intently listening to every word you say until like 2 or 3 in the morning because you were just dropping bombs like we'll do this, this is how we find products, this is how we do this, this is how we do this. Where did you, where do you get all your information? Is it all from experience or do you follow certain podcasts? Do you read different things or is it from, you know, I remember too, you have, you have your group, your event that you do, the Top Dog Summit. And I remember you talked about it then, like, yeah, I had this summit. I'm like, after listening to you that night till two or three in the morning, I was like, I'm there. And you're like, sorry, Kevin, you're not allowed. You're not invited. I'm like, what do you mean? I'm not invited. You know, it's for sellers only. I said, I'm a seller. I sell. I do stuff. At that time I was doing stuff, but no, but you also, you teach. So no teaching, you know, it's sellers only. I'm like, damn it, man. So where do you get all the knowledge from? Speaker 2: Yeah, so I can say that a lot of it came from me. Like at that time, a lot of it came from me. These days, a lot of it is actually coming from sales that I consult and train because you and I both know like you train a lot of people as well and you can learn from anyone. So I learned so much from them. It doesn't matter if they are advanced sales or newbies. Like newbies are so hungry to succeed. They know everything. Like they will just dig deep on everything. And advanced sales know obviously they have all the experience and they know a lot, especially about their own products and stuff like that. I guess I really dug deep when I kind of started this business and tried a lot of different things. I can say that now I kind of see this as a lot more legitimate business than it used to be. I think there are a lot less like black hat tactics. And even if you can do something, you probably don't really want to play with Amazon and kind of try to do shady and sneaky things to your account. Because being suspended, you can probably get out of it, but that affects the sale of your business eventually, right? People might not buy your business if you get suspended or blacklisted or whatever. Speaker 1: It has changed a lot. I mean, that's an interesting point that you bring up, but when we first... I started FBA in 2015 around the same time as you. I mean, I've been selling on Amazon long before that, but as an FBA model, And back then, it was almost everything. It was like every little, and we call them hacks now, you know, it's not all about the hacks. Hacks are cool, little tips and tricks are cool, but it's the fundamentals of the business that really matter, that a lot of people, they're always looking for this one little way to get ahead. But back when we first started, it was all about, almost back then, about the hacks. It was like, you know, What can you do to get reviews and what's the latest manipulation system to get ranked and what's the, you know, how can you buy data from some insider in China, you know, to get an edge up on your competitors and it was all about trying to get that edge and now I think it's a lot of those doors have been shut. I'm not to say that there's still some of that going on a little bit here and there, but a lot of those doors have been shut and now it's more, it's a real business. You have to build a real brand and come at it with real money and real, a real plan, not just find something on Alibaba and stick it out there. Speaker 2: Yeah, you and I both know that those that started at the same time that we did, even if they did a lot of money back then or whatever, most of them are not here anymore. And not because they don't want to be, it's because they did only those tactics and nothing else. That stopped working. They had probably terrible products. I used to sell this product that was a lawn erader. Do you know what that is? It's like lawn erader for you put it, it's like sandals you wrap around your shoes. It has spikes on the bottom to erade your lawn. You walk on your lawn, you erade it. It's probably the worst product. Yeah, it's probably the worst product they sold on Amazon. It should be like a three-star product. If you go to Amazon, most of them are like... Four, four and a half, but it's a really three star product, you know, and when Amazon reviews got wiped, I'm like, okay, we cannot sell junk products anymore on Amazon. Like that's, that's what that means, you know, unless I want to keep trying to cheat the system, because back then we could just cheat, we could just buy reviews, right? You can't really do that anymore, at least not easily. So I decided to just run this business legitimately moving forward. And that's when I kind of put most of the hacks aside and just tried to focus on Running a strong business. Speaker 1: One of the things a lot of people don't realize that are Helium 10 users is that you're the reason for Cerebro. You're the Cerebro tool. There was an event in Amsterdam and I remember Boyan who at that time was the head technology guy at Helium 10 and then now he's running the show for Helium 10. He came to you and you all sat down and you showed him what you were doing. You had developed a system for how you're analyzing stuff using these spreadsheets and this is very complicated and took some time and he was like, that's brilliant. Can we integrate this into a tool? And they created Sribro as a result of what you were doing. Can you tell us a little bit about that? Speaker 2: Yeah, sure. So what happened was you were the one to actually invite me for dinner at that time. We sat down at the Michelin star restaurant. I think it was inside the hotel we were in. If you recall, even at the end of the thing, you said, okay, let's all of you guess how much the check is, how much it all costs. And the one who is guessing the closest is getting it for free and the rest of you like, you know, pay his tab or whatever. Speaker 1: I think we all pitched in like 20 bucks or something each. Speaker 2: I was like the furthest off the number or whatever. I thought it was like a lot more expensive. But anyway, so in front of me was Manny Coats, who was the CEO of Helium 10 at the time. And next to him was Boyan, and they talked to me about my lecture. Because in my lecture, I only showed the free tools you can use to kind of do your images and listings and whatever. And they were like, why aren't you using Helium 10? I said, oh, I do use Helium 10. I use Cerebro. They had Cerebro back then. But it was only for one product. Why do you need several for one product? You don't. You don't really need to analyze one product. So I told them, look, I use it one product at a time, but they use like 10 or 20 products. I put them together, I put the spreadsheets together, and then I know Where I stand based on my competition, then I know what keywords I need to go for. And then Wayan asked me, can we integrate this to Hidden Tenant? I said, yes. Two weeks later, it was up and running. Like that was like super quick. And then Bradley had me on a serious sales podcast. I think it was like episode four or five when they launched and gave me credit for that as well. So that's what happened with Cerebro. Speaker 1: So, what would you say for experienced sellers? What are they doing wrong right now? There's a lot of podcasts and a lot of stuff out there for like beginners and here's how to do your basic stuff, but what is something that you could share that experienced sellers listening to this need to be keeping in mind when they're trying to launch their next product or they're trying to improve on what they have or expand their brand? What are some things or some advice that you would give them or something cool that they could take away from this? Speaker 2: Yeah, so I guess the first thing is product selection. Like when we think about product selection, it's the same thing I mentioned before. So if they keep selecting the products they launched the same way they did when they started, they are doing it wrong. Because not only the methods change, but also they have more cash to invest. They should go after bigger fish, like I mentioned before. And the other thing I noticed that they do a lot of times, especially beginners do this even more than advanced sellers, is if you launch a product, doesn't matter what the product is. Let me think of an example here. So I have these lights here in my studio. So let's say you're launching an RGB light. You know what that is? Like a light you can change the colors of and things like that. Let's say that's the product you're launching on Amazon. Now, the next product you're launching, you think, oh, I'm going to build up a business around studio, like to build your own studio. So, I'm going to launch a microphone stand and I'm going to launch this product, I'm going to launch that product. Now, a microphone stand An RGB light are two completely different products. You could launch a garlic press instead. It's a different product. It's different keywords, different supplier, different everything. You should go a lot deeper on your good selling product. If you get a hit with a product, you and I both know it's not just like data and stuff. It's also, there is some luck involved. You can be the best product researcher in the world, you're going to fail with some products. Probably like four out of five are going to be fine on average. And out of the four, two are going to do okay, maybe two are doing better, you know. But that's kind of average, I would say, for like experienced sellers. So if you launch an RGB light, you should launch like other types of lights or other RGB lights before you go ahead and launch your next product. Like before you even launch an RGB light stand, for example. Like I would say Go deeper, like I call this going wide and going deep. So you should go deep on your good-selling product, just launch more of the same thing over and over and over again. Now, the benefit of that is that you know the keywords, you know the PPC, you probably know it's probably the same factory that you're already using. By going wide, by launching different products, and you should do that too, is you basically can sell more products to the same person. So, if you think about Apple, I'm going to buy their iPad, their MacBook, their iPhone, and I have like all of their different products, but I'm not going to buy more than one iPhone, right? They have multiple iPhones. But I'm only going to buy one of those. They're going deep with their products, but they're also going wide and launching different products. And that's how you grow a real brand. The bottom line is I think sellers are kind of jumping from product to product too quickly. Instead of realizing they just found a very strong gem, they should just dig deeper into that and launching more of the same thing. Speaker 1: Along those same lines, what do you think about competing with yourself? So if you have Tomer's RGB lights and it's crushing it, What about just launching basically a very similar, just slightly different, maybe another RGB light and call it Kevin's RGB light and you control both so you're getting both spots on the page. What do you think about people that are doing that? Basically creating your own private label of your private label. Speaker 2: Yeah, yeah. There are sales that do that, I guess. If it's the same light, I don't think it makes a lot of sense because you're kind of cannibalizing your own sales and stuff. If you want to really dominate, you can do that with multiple brands, multiple stores. I know some sales that do that, but that's kind of a gray hat. You're not really allowed to do that and control the bids and stuff. But I think you should just launch a different type of RGB light. You have a $30 one, you should launch an $80 one, a $50 one, a $200 RGB light. You should just launch different types of lights for different types of audiences, if that makes sense. Well, still using the same supplier, still very similar keywords, everything is very similar. The biggest brands that I've seen, I think like 7, 8-figure brands are mostly 1, 2 or 3 products. That's it. And just like going very deep with those products. They just know their products really well. They bring in very high quality products and that's it. I think smaller sellers tend to think, oh, I need to have 20 products, 50 products or whatever and all different to win this game, but you don't. Like it's enough to have even one, two or three good products and just launch more of the same stuff. Either it's on the same listing or it's variations, obviously. Speaker 1: Yeah, the downside of just having one or two or three products is that if one of those goes down for some reason, then it's a serious dent in your cash flow. But I agree with you. I'm always, you know, you see people adding lots of products. You see some of these guys that have 50, 100, 200, 1,000, 10,000 products. I'm like, man, that's just too much to deal with. And you got to have too many employees and too much going on. I have a rule that if a product is not making at least $3,000 a month in bottom line contribution to me, I eliminate it after six And people are like, why are you eliminating a product that's profitable? It's like, because I don't want to have a huge company with all this overhead and all these hassles and constantly juggling inventory and cash flow. I'm more like, let's find 5 or 10 maximum that work and let's stick with those. And probably 2 or 3 of them are going to be the big cash cows and the rest are nice little supplements. And I think that's where a lot of people get lost on when they're looking for things. So on looking for new products, how much innovation do you think you need to have now on Amazon? Just go to Alibaba or Global Sources or one of these and find something and modify it a little bit or is it do you really need to start truly innovating and come up with your own designs or what's your thoughts on that? Speaker 2: So I really think it all depends, you know, like it depends on the product that you find. Do we still have products that we find that are, we want to innovate them, we have some ideas and then we stumble upon a supplier that already has what we want to innovate and it's not on Amazon yet and we just launch that, you know, that happens. Other times, you need to kind of develop a bit more around the product. We have a brand I'm partnered up with that is more wooden products. So, it's very easy to just do a unique design when it's made out of wood. You know, to pattern design those is very easy as well. So that's one thing we do there. And then the thing I think we did the most at this point, and I think that's not done by a lot of sellers, is basically targeting a very specific niche in a very competitive niche. Speaker 1: So it'd be something like baseball, if you're selling like baseball bats, you'd sell baseball bats for left handers or something like that. Speaker 2: Exactly. Yeah. Something like that. Yeah. But basically looking at the keywords in that case and just seeing if anyone is targeting that specific term and making sure there is enough search volume for that. And also not just one keyword, but they want to see multiple keywords probably showing up in brand analytics, at least just to know that it has some volume of search. Speaker 1: So what are your tools of choice when you're managing your Amazon account and looking for keywords and looking for opportunities? I know you're probably still using Cerebro because you helped invent it. Have you developed some internal systems or internal tools that you use in conjunction with Helium 10? What's your process like there? Speaker 2: We have a spreadsheet that I created a while ago that kind of helps you to validate products that we find through Helium 10. We use Blackbox a lot actually to find new products. And we use Brand Analytics as well just to find some, just based off of keywords and start our research there. But those are really the main two. And I will also say like for my own brands, once you have a brand, it's a lot easier to kind of try and find products. I wouldn't say it's not easier to find products, but you know where to look, you know what I mean? Because you're trying to grow an existing brand. But another thing that we are doing is we are looking for products for the brands that we consult for. And then that's like more challenging, but we've done it like I don't know, over a thousand times by now probably. So we know what we're doing and how to kind of help them grow their brands. And a lot of times, again, it's just telling them, look, launch another RGB light or launch like five more colors here and it will do well. So that's a lot of times like things we consult on and they don't really think about or look for because they Again, do that mistake of like launching very different products and not really looking at what's already working. Speaker 1: How long does it take process? I'm assuming you may be involved or maybe you have this VA since you developed a system for this. How long does it take to actually find a new opportunity and how many of them that go to the wayside that look good and you put them through your internal spreadsheet and through your system and then they just go, they just don't make the cut. Is it like a 50% that look good initially and once you do the research and the sourcing, it's like they get cut. Is it higher than that? Speaker 2: I would say probably like between 10 to 20% go through eventually, like through the whole pipeline because sometimes you try to source something you can't or it's too expensive after all the improvements you want to do and you don't really want to give any of them up yet. So it falls through and I will also say the process It can take anywhere from, research until launch can take anywhere from three months to I would say 18 months or something. Because it just depends like how long it takes you to not just, finding the product is the first step, but after you find a product to actually validate the product, get samples, maybe do some iterations on the samples like four or five times sometimes. So it can take a while to complete all of that. And if you do some design patents or things like that, that's more complexity. So it just depends. But what I always say to sellers, Don't just work on one product at a time. This business is all about product development. If you're not developing any products, it's a very simple business to run. Like PPC, supply chain, some pricing APIs, whatever. That's it. That's the business. It's not complex. You can outsource most of it. But if you keep launching, working on new products, that's where your main focus should go. And that's the main work in this business, if you ask me. So I believe that if you have whatever brand, you should be working on 5 to 10 products at a time. Because let's say you have only one product, you ordered a sample that you worked on for two months now, and you get this first sample, it's not the best, but you're saying, oh, I spent two months on this, I spent whatever money, whatever time, whatever effort, I'm going to launch it anyway. That's a huge mistake. But if you had five or 10 products you're working on at the same time, you know some of them are going to fall, some of them are going to go with whatever, but you should really be launching very good quality products on Amazon. Speaker 1: So what about if it takes you three to 18 months to do this whole process like you just said, things can change in that time. The keyword demand can change, there's a ton of competitors could come in, someone else is using similar tactics that you've taught them or similar that's been spread out there and then they enter the market. So you're six months into this and you're like, man, we got a kick-ass product here, this is gonna be awesome. And then boom, you redo the keyword research and you're like, holy cow, where'd all these other people come from? What do you do in that case? Speaker 2: What we do before any big step, we basically validate the market once again. We basically take an extra screenshot, put it in our own spreadsheet to just see the numbers again, making sure it's still a good opportunity, even though it's been another three months. Sometimes we even say, look, we don't know what will happen in this niche. Let's wait another month or two and we have everything ready to go. Production is ready to start. But the real green light, we call it green lights in the company, the real green light that you give is when you pay the deposit to the supplier, like 30% usually. You pay to the supplier, that's when you give the go for the product. Everything until then is research and validation. When you pay that deposit, that's when you give it a go. And I think that's where sellers make mistakes as well. They research a product and they say, oh, this seems nice. Let's go to Alibaba, check for prices, whatever. Then they may even get a sample and then they think, oh, I don't even want to launch this. You know, it doesn't make any sense. So that should already fall beforehand. You know, when they do product research, it should fall. So I think they have like the system of what happens when kind of off. Speaker 1: So to grow to eight figures, that takes serious cash. So how did you, you said in the beginning you had an investor, but after six to eight months or whatever, you kind of went one-man show. So how have you been able to cash flow your business, to grow it to an eight-figure business? Speaker 2: Yeah, I only borrowed 50k from my family, that was it. But I will say that doing consulting and running events helps funding this business. So that's how I funded it, basically. Without it, I won't be able to, without taking some funding from outside into this business, but it was all self-funded, basically. Speaker 1: So it's having the right margins, knowing your numbers, and then just being able to generate a little bit of extra cash by doing some consulting or teaching or running an event on the side to generate a little extra profits to throw back into the product business. You never had to take any loans from Amazon or any outside stuff like that? Speaker 2: Yeah, no loans or anything. And also I can say that I had a lot of luck as well. When I started, I had a few good products that were very cheap and were doing really well, like the turnover was really good. So that really helped cash flow to kind of ramp up quickly this business. One thing that I know that you agree on as well that they think sellers neglect is basically going after premium products when it makes sense and when it's possible. So if everyone is selling the product for $30, $40, $50 and it's a personal product, let's say a diaper bag, if everyone was selling the Biggest, most expensive leather bag was $50. I would probably sell one for $80 and differentiate it and make it a lot better, more premium, whatever, and that will work out really well. But if it's not a personal thing like disposable cups, you probably don't really want to make nicer disposable cups and sell them for $20. It doesn't make any sense. But if we can go premium, that's what we do. Speaker 1: What do you think the life cycle is on a product? Speaker 2: So that again, that varies. Now with all of the exits that are happening, I recommend sellers to kind of think five to eight years ahead. So if it's not going to sell in five to eight years from now, I'm not even going to go to the next phase. So let's say a power bank, for example, is not something I'm going to recommend selling because in a year or two, it's going to become obsolete by a stronger power bank, right? So it doesn't make any sense. A cell phone accessory is kind of the same thing. There are some electronics you can sell for like five to eight years, but obviously most products are not going to last five to eight years, but that's where we start the process. We just think, can we launch a product that's going to last for at least a few years and not die out? Like any sort of gadgets, anything like that, that is kind of like a fad or whatever, we never go for. We used to, but not anymore. Speaker 1: So what do you think some of the keys are to scaling up? What are some of the keys to putting together a good team or to putting together good systems that you think a lot of people just overlook these steps or they don't do? Speaker 2: So the book that I wrote, Write the Amazon Wave, is actually like the first half of it is just foundation, just research until launch, how we do it. We do it a bit differently, obviously, than most. We have some flow charts in there to kind of show the process. And then we talk about supply chain, PPC, KPIs, those sort of things like to run, running your business. And then the final thing is more about team building systems. And I think that sellers understand and know from Freedom Tickets, from other resources, how to find products, launch them, a bit of PPC, supply chain, but that's usually it. That's the foundation you get when you do a course. You cannot expect to get everything, but the two missing pieces Are building a team and having six systems in place. So I think those two are neglected and what sellers usually do is they launch product after product after product while not focusing on those two things and then everything collapses on top of them. Or they exit for a low multiple because they have to, because they're burnt out. So to build a team, so I did it twice. So the first team that I built, I had 12 people on my team. Some of them were part-time, some of them are full-time. So what happened was I was told to start with customer support, right? To have someone doing it two hours a day. So I hired someone for customer support for two hours a day. Then I wanted someone to help me with product research. So I had another person part-time for that. I hired a full-time freelancer that used to be a freelancer to run my PPC and that's kind of how I grew everything, right? They just hired an employee after employee to kind of fill slots. And different tasks. The problem was that everyone was reporting to me and I need to kind of answer to everyone and that's not really scalable. That was even worse than doing everything on my own. Like it doesn't make any sense to try to kind of let other people do it. And also they, most of them did it wrong. You know, it's not that they did it wrong. I just taught them the wrong way to do it. And then I need to do a lot of it myself. So I had a few options. I could kind of quit or whatever because it was just too much. I already had like a seven-figure business back then. But I just decided to let everyone go and start from scratch with employees. And the second time I did it, I did it, I think, the right way. And what I did is when I interviewed people in the Philippines, I basically told them, look, I'm going to hire you to start with customer support. It's going to be a part-time job to begin with, but you are going to be hired to do full-time work. So I'm going to give you more and more tasks. And over time, I want you to become a manager and manage a few people underneath you. That's the goal with the first hire and even second hire. to do. And when I changed that narrative and when I kind of interviewed people for that role, even when they started, they knew this is a temporary thing. They're not going to do it for forever in this company and then move to a different company. And they're only going to do it for a while. So then the first person I hired for customer service, then I started teaching her product development, then I started product research, then I started researching creative work, like talking to photographers, copywriters, all of that. So she did all those creative stuff. And then I asked, what do you want to delegate first? He said customer support. So I promoted her to be a marketing manager. And then the second person we hired actually ended up being my operations manager that is handling the supply chain and PPC and all of the analytic stuff. So I basically see this business as like more analytic stuff that is supply chain, PPC, and then more of the creative work, which is customer support or customer experience, marketing, like social media stuff, launching, And product research. And now I have seven people. So I have these two managers, five employees underneath them. And I only taught two people everything. I didn't need to teach everyone because the managers taught everyone else. And the managers don't really have any day job. They are just making sure everything is happening as it should. And if someone needs some time off, someone quits, whatever, I always have a replacement of someone that knows how to do the job because they did it already before. And I will say that all of them are low-level employees. As you would say, I basically hired a blank slate of people and they didn't have any prior experience on Amazon or anything. That was, I think, 2016, 2017, something like that, when they built this entire team. But everything is outsourced to experts, like Fight Forward, resourcing, graphic design, copywriters, all of that is outsourced to the best in the industry, basically. But it's run by those seven people in my team. So that's how I built it and what I recommend sellers. When they start hiring, the first, second hire, those are the most critical hires that you will do. So either hire someone that is high level or just very intuitive in this business and gets things quickly or hire like a local person that you can count on and is your like right-hand person and then they can build out that team in the Philippines or even locally or whatever. Again, that first, second hire needs to be people that you get along with really well. And I did the same thing in my consulting business. I hired two people in Israel for that, one very creative, one very analytic, and they kind of handle a few more employees. Some of them are in Romania, some of them are in Israel, but I really believe in that business, and then you can keep a very lean business. I think Amazon really gives us the opportunity to build a very lean business and still be able to scale it to a huge business. Speaker 1: So you would recommend someone, their initial hire almost overpay. Like you said, the person that you hired initially is like, this is a good person. It's a full-time job, but you're only going to be working part-time initially, but I'm going to pay you as a full-time job. Just to get that right person so that you can cultivate them and move them up the ladder to make sure. Speaker 2: Yeah, and you can even start with a two-week test, two-month test, whatever is a part-time thing and then move them over to full-time after that. You can do that if you want. That's what I did as well. But yeah, really, and I will say, hire as soon as you can afford it. That's my tip for everyone. People are, I think the two things that I keep hearing from people is I wish I started hiring earlier and I wish I had more people. Like I think those are two things I keep hearing and you should really start as soon as you are able. And I think sellers think, oh, I need to have all of my SOPs in place. I need to have everything organized. I need to have all of this. You don't. You really don't. I think I, when I started this business, I was told to kind of, when I reach out to suppliers, I should treat myself as like Big company, you know, I should reach out to them saying I'm a big company, whatever, that helps, you know, a bit with pricing, stuff like that. But when you are hiring people, you shouldn't try to do that. You should tell them, look, we are a startup company, it's just me, you know, you're going to help me to build this thing to a massive, massive business. And they are happy to do it, you know, they are being hired for a job, they're happy to do what they were hired for. So, to organize everything, to put everything in place, SOPs, all of that was done by my team, not by myself. Speaker 1: Awesome. So let's talk a little bit about this book. It's been like a two or three year passion for you. I know you've been working on this a long time. Why did you decide to write Ride the Amazon Wave? Why is it called that? And who is it really for? Speaker 2: Great question. So yeah, I started this book right when COVID hit, actually. So when COVID hit, I couldn't fly anywhere, I couldn't do anything. That was two years ago. And I decided, okay, I'm going to do something that will benefit the industry in some way. I can't go to events and speak. So what am I going to do? That was my main kind of thing to do back then. So I thought, okay, I can start a podcast, I can start a YouTube channel, I can do different things, blog, whatever. But then I said to myself, okay, I'm just gonna write a book and do something that I don't think anyone did in the industry and that book is gonna be the first book. For Amazon sellers, not like how to sell an Amazon book. I think there are enough resources out there to learn how to sell on Amazon and that's not my target audience. So I just want to help active sellers grow their business, exit their business, systemize their business, automate it, whatever they want to do. So that's where it all started. The name was actually like that. I think that took me the longest time to come up with the name for the book and also like Kevin, I know you launched a lot of products on Amazon. One thing I can recommend is don't break the book. Speaker 1: You have no idea how much work... It's a lot of work. Speaker 2: It takes that. I launched a lot of products. I think this was the most difficult product that I ever worked on, like two years in development and took a lot from me, obviously. So yeah, the book is really aimed towards those that are already selling. Like the dedication on the first page is just like, if you ever have like 500% echos for your product, whatever, like those type of sayings, and then it's like, this book is for you. If you're not an Amazon seller, you won't even get like half of what's written in the book, I guess. So, yeah, it's really meant for anyone. It doesn't matter if you just started yesterday with your product on Amazon or if you exited a brand and you want to start over. It's meant for Amazon sellers. Speaker 1: And the book's about out now, right? You can get it on Amazon. Is it Kindle and paperback or hardcover? Speaker 2: Yeah, you have Kindle, paperback and a hardcover as well. Audiobook is coming out in probably two, three months or something. Speaker 1: You're going to record that yourself with your voice or you have an actor? Speaker 2: No, I'm going to get someone with no accent. Speaker 1: Awesome. Speaker 2: I try Kevin to outsource as much as I can, you know. Speaker 1: There you go. With AI these days, you could just have some voice and probably pick the perfect voice to read it until you get to some word that they don't understand how to say. They'll be calling Asin instead of Asin or something. Well, the next time I see you, I know I'm not going to be seeing you at the Billion Dollar Seller Summit here in a couple weeks, you're not able to make it over, get some things going on, but the next time I see you, maybe at the Sale & Scale event, I want a signed copy of the book. Speaker 2: Yeah, yeah, you'll get a signed copy. I'm going to open a booth up to kind of give out books and signed copies and stuff, so I'm going to do that in Sale & Scale. I'm really excited about that event. I don't know about you, but I think it's going to be a really good event, like the first Hillington event. I think it's going to be really good. Speaker 1: Yeah, they're spending a lot of money on it. Several million dollars to put this on. It's not just some whipped together thing. And the way they're doing it's different. The way they have the schedule with the morning yoga and the dance classes with Bradley and the way they're doing the little breakouts. It's in Gary Vanderchuck coming and speaking and Neil Patel. It's going to be a pretty cool event. I'm speaking. You're speaking as well, right? Speaker 2: Yeah, I'm speaking as well. I'm actually speaking on automating your business. So that's my topic. So that's what I'm going to be covering in the event. Speaker 1: Awesome. Well, I really appreciate you taking some time out of your schedule today to come and speak. It's been great. It's always a pleasure to speak with you. You always got some good information to share. You're one of the people that I think is one of the best in the space, one of the people that I tell people to follow. See what Tomer is doing and see if you can mimic that because it's going to give you a good chance for success. So, I wish you all the best on that book. I hope it becomes a top seller. Everybody that's out there, make sure you go check it out. It's definitely going to be worth the money spent and I'm looking forward to reading it myself. Speaker 2: Cool. Thanks a lot, Kevin. I appreciate you. Speaker 1: Cool, man. We'll see you, I guess, at Sale & Scale. Speaker 2: Yeah. See you soon. Speaker 1: I hope you really enjoyed Tomer's episode. That was a lot of really good information. You know, in these podcasts, I don't really pair for them. I don't do notes. I don't have an agenda. Don't even really do talking points. We just talk. And just see where it goes and let you be a fly on the wall. So I hope you're enjoying the AM-PM Podcast. If you haven't, go back and check out several of the last episodes back to episode 294 is when I took it over with Manny Coats as the guest. And I'll be back again next week with another awesome episode for you. I'm really excited for you to hear next week's episode. So be sure to check that one out or set the iTunes or the podcasting program that you're using to automatically download the episodes each week. And also don't forget the Billion Dollar Seller Summit which Helium 10 is a sponsor of is coming up in just a couple weeks in Austin, Texas. You can go to BillionDollarSellerSummit.com and get some information on that if you want to come. Or you want to catch one of the replays if you're not able to come. And also sale and scales event is coming in September in Las Vegas that both Tomer and I will be speaking at. So hopefully you can make it out to that one as well. Otherwise, I'll see you again next week and don't leave just yet. Here's this week's little nugget of advice. You know, in many cases, improvement is not about doing more things right, but about doing less things wrong. So don't always look for things to add, look for things to eliminate. Again, in many cases, improvement is not about doing more things right, but about doing less things wrong. Don't always be looking for more things to add to your plate, look for things to eliminate. Take care and we'll see you again next week.