Private Label Live: Navigating Today's Amazon Ecosystem with Kevin King

Private Label Live: Navigating Today's Amazon Ecosystem with Kevin King 00:00:07 Pumped about this one! We have an OG official Amazon seller, expert extraordinaire with us today, Kevin King. Brandon has come to you live from Boston. There's four inches of snow on the ground in Brooklyn for the weekend, having $19 cocktails, and Kevin is in Texas. That's right. I'm having good barbecue. You're having good barbecue. That's right. Look, I've been excited about this one. I want to dive right into it. We always kind of start out the same way. For those of you who are here with the show for the first time, our goal with this is always just to give as much useful information and have some fun telling some anecdotes about life selling on Amazon. And sometimes it goes certainly beyond that. 00:00:50 And we talk about business management and we try to be as forthright with whatever information and tactics that we use to help you become better Amazon sellers. So we always start out by doing a simple origin story. Take us all the way back to 1999, Kevin, if you could, and talk about your e-commerce journey and walk us through where you are today. Yeah, sure. I started actually doing e-commerce, and I think I picked my first sale in 1994 or 95. That's before Google existed. AltaVista and Lycos, and I think Yahoo had a directory, a human-edited directory back then. And that's back when videos were little postage stamp size and they stuttered and everything. So I think my first sale was like 1996, 95, 96 on e-commerce. And I had a website where we did collectibles. 00:01:45 I was in the trading card business, baseball cards, but featuring pretty girls, not guys. And so that's where I started. So I was doing, we were doing a lot of high-end stuff. Like gold-plated cards, like with gold signatures of the models, like in a really nice like brick crystal holder for like $100 and stuff. So it was a collectible business. And that evolved into a calendar business, which we still do to this day. I still have to this day. I sell on Amazon and I have a direct list of 13,000 or so people that actually buy from me off our house list every year. Until they die, pretty much because that audience is getting older and older and older. 00:02:28 Um, it's always scary when you get a when you send them a brochure through the mail and it comes back and says 'deceased.' Um, but uh, um, and someone's been buying for 20 years so that evolved into e-commerce online. I started doing eBay; that's one of the first people on PayPal back when they used to give you like 10 or 20 dollars for every sign-up that you would do as an affiliate. Started selling on Amazon in 2001, but that was primarily in 2001, as a, basically using like eBay because Amazon had back then had a 'Sell yours' program on some of those things, you know, sell yours. So if I had an old printer or I had an old, you know, whatever, something I wasn't sitting around that I felt I could get more money off of Amazon, I'd put it on there. 00:03:10 The calendar business is really, really where we got our start on Amazon in there. It was like a program called Advantage. I don't know if it still exists, but it was for books, media, and DVDs. And it's similar to vendor accounts, but Amazon would buy everything basically on a consignment basis rather than issuing purchase orders that they were committed to. They would do it on a consignment basis. So we would ship in calendars. And I remember the first year, I think we sold 50 on Amazon. And that just kept going up to 100 to 400. So now it's into the tens of thousands every year as Amazon's grown. That evolved, I did. We did that for quite some time. Still running a separate e-commerce site for everything else, I was doing. 00:03:51 I have a big background in direct marketing-actually physical stuff through the mail. So it was a natural fit for me and to that. Um, I was running a television production company and doing some other stuff as well. I had my hands on a lot of different things. Kind of an accident that we never actually sold it but it just was on autopilot. Travelled the world for seven years where I was actually able to uh, I'd work in Austin for a month a week or two a month and a week or two a month uh, the rest of the time I would be travelling somewhere ended up going about 92 different countries uh during that time just riding that wave out um, that that business finally just uh, the gig was up and I was like what do I got? 00:04:34 What am I gonna do? Uh, so I started looking at some different options and one of them I stumbled across amazing. dot coms uh they were doing back then i think it was uh i think theyre on version three maybe version four of their course and they were doing like a four-part video series you know the typical sales pitch and i watched some of that i was like i dont need to pay 5000 for a course ive already been doing all this ive already known all this stuff let me just look into it that was late 2014 so in early 2015 i just dove in back then i think there was two or three podcasts theres wasn't much material hardly any software so Jungle Scout didnt exist Helium 10 didnt exist. 00:05:15 There's just a couple little tools that I think the guys at Amazing had developed and just started selling. And I launched with five brands at the same time. So I came into it with about $150,000 to start with and launched five different brands in five different categories: pets, sports, outdoors, kitchen, electronics, and beauty. And two of those five product lines were not going to Alibaba and sourcing something and sticking your name on it. Two of those were completely from scratch. Products I developed completely from scratch, from molding to 3D prints to everything, all the way to final product. And one of those was an electronics product called Basecamp. And it was a charging dock for the Apple Watch. The first version of the Apple Watch was coming out around then. 00:06:10 One of the hot things that were selling on Amazon were watch stands, like little bamboo pieces of shit, basically, wall stands, you know, for $15 little things. And I'm like, I don't want that. I've got a $1,000 iPhone and Apple Watch and whatever. And I don't want a little $15 junk on my desk. I'd rather have something that's more in line with what's, you know, the Apple products. So I developed one called Basecamp. And I was like, you know, you've got all these cords everywhere on your desk, and it's just a clutter next to your nightstand. So I developed a product that ended up selling for $9 retail price. Well, and it costs about $22, but it had a nighttime in it. 00:06:48 It would charge your Apple Watch, your Apple phone, and your iPad all together. The second iteration of it had a Bluetooth speaker built into it. I designed the entire thing. I'm not an engineer, but I just, you know, sketched out and had people do the CAD work and stuff. And launched that product. And out of five, that one took off. It just took off like a rocket ship, doing crazy numbers. I remember at the end of 2015. And we create; we can talk about that later, but create some problems on cash flow and financing and all kinds of stuff just to keep that thing rolling. And that just kind of evolved from there. I still have a couple of those brands. Some of them have just discontinued. 00:07:27 I made some mistakes, you know, so they weren't really sellable because I, I just didn't do, I didn't do what you're supposed to do. When you're setting up the accompanying initial, I was just running by the seat of my pants, basically. And then in 2016, that evolved into Manny Coats over Helium 10. Actually, I was posting something in his high rollers group or Facebook group or whatever it was at the time. And he liked some comment that I posted. He said, hey, why don't you come on the podcast? I'm like, no, no, I'm just a seller. I got my head down. I'm this behind the scenes guy. He convinced me to come on and I guess that that episode did really well because I just basically said it like it is, you know there's a lot of people that are out in the space that either don't know what they're talking about or they're just afraid to say things like they are and so I just said like it is. 00:08:12 I guess that resonated and from there that just grew into what I told the consulting stuff I did like with the Freedom Ticket and the Billion Dollar Seller Summit and the Heathens and Elite, and then I still I'm still selling Amazon; I have uh three brands uh we launched uh five actually, five brands still on Amazon, three new ones that have been launched in the last year with the intent to sell them. So they were, you know, from all the mistakes I made early on, now I'm like, okay, this is what you got to do. This is how you got to set it up properly from day one. So, you know, we got Scott Dietz at Northbound involved on a couple of them to make sure everything is done right from the beginning. 00:08:48 And we're building those to hopefully sell. One of them is dealing with recycled ocean waste products. So we have products in the dog space that are all made from recycled ocean waste. And we have a licensing deal with a big company that actually approached us and said, 'Hey, we want you to do our entire dog line under license.' So this company has major athletes and stuff out there that'll be pushing it. And some of these guys have 3 million followers on Instagram. So we launched the first product in July. We'll have an extra little push, plus they're already in stores everywhere. So it should be good. And then we also launched one last year around the pandemic called Germ Shark, which is in the PPE space, which exploded and did extremely well. 00:09:32 And now he's probably going to have to pivot that company because that entire thing has become just completely saturated, completely a mess, going from $40,000 a day in sales to $500 to $1,000 a day in sales. So there's lessons to be learned in that as well. And then I still run the calendar business and several other things. So I keep pretty busy, but I have no employees, one VA for three companies. And I got eight different revenue streams that come in between everything that I do. But I just try to work smart, not hard. Great. As you were talking, I was just thinking about how many sellers that you've been around, tons of successful ones, many who are not. 00:10:24 And to me, what I want to kind of have you break down for us is, are there any patterns in regards to the people who really make their mark on Amazon and the ones who never seem to cut the mustard or get past the sort of initial selling phase? Are there any themes that you've seen over the years that really tie success and failure together? Yeah, I think the dreamers and the get-rich-quick people are the ones that usually fail. The ones that are sold a bill of goods by some guy with his Lamborghini on a YouTube video or some big webinar and then spending $3,000 or $5,000 budget on a horse or something, those typically fail. Not all of them. Some of them make it through. 00:11:10 Those were the ones that, you know, I think it's about 95 to 97% of the people that try to sell on Amazon don't make it. And it's a combination of things. Some of them are underfunded. Some of them, it's the skill set to actually be successful on Amazon. Most people don't realize how many hats you have to wear or how big a team you have to have. There's a lot to freaking know. And a lot of people think it's easier than what it is. It was easier six or seven years ago, definitely, than it is now. But it's a real business. And so the people that succeed, the ones that I've seen that are, you know, I know people have sold three companies in the space, you know, built one, started from scratch, built it, sold it for $4 million, did it again for $11 million, now doing it again for $18 million. 00:11:54 And those are the people that treat it like a real business. It's not, I may be quitting my job right now. You know, this example I just gave, you know, the husband stayed working for three years after they started the business. The wife did it off the dining room table. And he didn't quit his job until just before they actually sold the first business. And they're very financially savvy. So that's where a lot of people get into this. They don't understand the numbers. And so I think the biggest thing that separates success from failure is math. And most people that are getting into this business just have no clue. Really, what the cost is. I hear it on podcasts and stuff all the time. I actually called Bradley out. 00:12:36 It's a serious seller's product about six months ago. So there's a woman on there talking about her profit margins. And he's like, wow. And she's like, yeah, my cost is this. And I sell for that. So I have this profit margin. And she was leaving out everything in between. And Bradley didn't correct her. And I called Bradley afterwards and I said, Bradley, dude, you just missed. A lot of people listened to that. Just you should have corrected that um he's like yeah yeah I should have it, that's the problem is most people don't know what it takes to actually do this and what the numbers are and that's what separates the success from the the failures and a lot of people going into this they're always the question is always how much money do I need if I'm going to start an Amazon business and and it depends, it depends on your goals can you start one five hundred thousand bucks sure but that's just going to be a part-time gig 00:13:28 that you're just going to be making a little extra cash to maybe have a nice dinner with your wife or something. Or do you want to build a business that you can sell for millions of dollars? That's a whole other animal that's going to take a lot more money. And people, when they first pick their first product, maybe they have $10 ,000 or $20 ,000, but they don't know how to do the proper math. And like I always tell people, you need at least two and a half times your initial landed cost in the bank ready to go if you're going to start this business. So what does that mean? That means if you've got 10 grand, that's your life savings if you're going to start an Amazon business. 00:14:02 I see a lot of people go out and spend $6,000, $7,000, $8,000 on their first product thinking that they're going to make it, but they don't understand the cash flow. They don't understand the math. They don't understand the dynamics. I'm like, no, the maximum you should spend is $4,000 because you're going to have to order again before you get paid from Amazon for the first batch. You're going to need some stuff for PPC. You need some other things. Two and a half times is the minimum. Three to five is better. And so, that's where a lot of people make a mistake. So they choose products or they source products that they're not prepared to sustain, even if they're successful. 00:14:33 And so, and then you hear stories that I started with 500 bucks and now I'm, you know, I just sold at the ratio for 2 million. That's bullshit. Someone might've started with $500, but what they don't tell you is a month later, they got a loan somewhere. They found out they loaded something up on a credit card. They had a rich uncle that pitched in. To start with $500 and grow to $2 million without any other, some sort of. Really good terms from your supplier or some other thing that's kicked in there, it's not possible. Let's talk about patience. A lot of people, whenever they start a new endeavor, they don't understand perhaps how much failure is prevalent, even for people who eventually gain success. 00:15:16 So I'm wondering if you have any anecdotes related to people overcoming their shortcomings, I mean, even your own story. you you certainly had some flubs along the way and had to get experience to learn um yeah i mean experience is the best teacher i mean you can read all you want watch all the videos you want you got to get in there and do it and that's i tell a lot of people a lot of people they they start with their first amazon part of it doesn't work i'm like look you did that that was you that was your uh your your high school uh your high school degree is going through going through the forces or watching youtube videos or whatever your choice of of learning is you get your college degree when you launch your first product and, and you get your master's when you launch your second, because it's, you're learning. 00:16:02 You've got to, you've got to go out and do it. And most people don't succeed on their first product. I mean, some do, but most don't. And, and you got to take that and learn from it. And so, that's why someone asked me the other day on a Clubhouse, like, 'Hey, I've got 50,000 bucks. I found 10 products that I think I can do. How many of them should I do?' I said, one. Unless you have experience in e-commerce, unless you've been doing this for a while and you know about sourcing, you know about how to do all this, if you have that experience like I did, launching five, maybe you're okay. But for the average person, you should start with one. Don't spend all that $50,000. 00:16:37 Spend $5,000 or $10,000 of it and learn. And you're going to make a lot of mistakes. And then you can apply that to the rest of the other $40,000 that you have and have a much better chance of success. It takes patience. So many people, they want to quit their job. They get into this because they're sold a bill of goods that I can quit my job in a month or two months or I hate working for the man. It can take to do this right, unless you come to it with a lot of money, it's going to take a year, two years, or in some cases longer before you can actually truly be self-sustained in this. It depends on the lifestyle you want to live too. 00:17:11 If you're happy to live around $20,000 a year, you can do it faster, but if you're a normal you're a citizen in the U.S. Is it needs 50 to 100 grand to have the basic quality of life? Um, it's going to take a little while because you know this is a very cash-intensive business as you guys know, it's extremely cash-intensive and um, you're a lot of times having to rob Peter to pay Paul to get things going. And usually, most people there's a skill set that you can... getting to seven figures on Amazon isn't hard, um, I mean if you have money behind you. But going from seven to eight to nine, that's where the game changes. 00:17:47 And it takes a whole different skill set, a whole different type of person and management team, and everything to do that. A lot of people don't quite understand that. But getting to the low seven figures is not very difficult on Amazon if you come to it with the right mindset and enough funding. That's awesome. Yeah, Kevin, you mentioned for you even personally. Personal experiences going through over the years, what are some of the pitfalls you've made on some of the businesses? And you also mentioned that 60 years ago, it was much easier than it is today. What has changed in the Amazon ecosystem? Yeah, the pitfalls for me, the number one mistake I've made is cash flow. I didn't drink my own kool-aid when I first started. 00:18:35 And that's why I preach it so hard now. When I started this Basecamp, this Apple Watch stock, just to give you a quick story on it, my landing cost was somewhere around $22 on these things. I was selling them for $89 on Amazon, so it was a good margin. I mean, I ended up lowering them down to $69 at one point, but they were selling so well at Christmas of 2015 that I was going through $15,000, $20,000 a day of these things, and I needed more. And so I called my factory in Shenzhen, and I said, 'Hey, look. I need like the normal order was 3,000 on these. I said, I need 6,000 more of these.' And they're like, 'Okay, that'll be $130,000.' And I didn't have $130,000. 00:19:15 I didn't have this two and a half times. I'd use like basically all the money that I had. And so I needed it quick because I'm like, if I don't get this money quick, I'm going to lose this momentum. I'm going to lose everything. And so I didn't have a rich uncle to go to and say, hey, can you wire me 150 grand? Can I borrow some money real quick? I maxed out all my credit cards at the time and everything. So I was like, what can I do? And at the time, there wasn't a PayPal or a Crew member or all these other sellers funding or all these other choices that there is now. There was Cabbage and there was On Deck and there was Blue Vine and a few of these kind of places that take pretty high interest rates. 00:19:56 They look at your past sales history and you know some they give me 10 grand, 15 grand because I was a new seller, you know I didn't have a year's history on Amazon and it was still back then, they're like, 'Selling on Amazon? You know this is risky.' Yeah, you know. They didn't understand like they do now, and so I had to go out to uh MCA lenders, merchant cash advance lenders. Which if you're not familiar with what those are, it's basically not most of almost all of them are exclusively based in New York, certain families, you know, not Italian, but mostly it's a subset of the Jewish community there. And their interest rates are 40% to 60%. But they'll give you the money in 24 hours. 00:20:41 And you have to sign a COJ, a certificate of judgment before they'll give you the money. So I called a couple of these guys and I, yeah, we can, we can give you 150 grand. We'll have it in your account tomorrow. But you're gonna have to pay us back. It's about a 40% interest rate. And we're going to start taking daily payments in two days after we give you the money. And we're going to start taking $1,000 a day out of your account every day until it's paid back. And it's usually like a 90 to 120-day period. I did the math. I'm like, look, I've got an $89 product. It's landed $22. I have, I forget the exact numbers, but a $30 margin in there. 00:21:17 If I take this $150, it's going to cost me $200 with the interest and whatever. And that's 6,000 units I'm getting. So that's whatever it was, $20 a unit. I mean, an interest, not an interest. An interest is like $3 or $4 a unit. I said, 'I can sort of' that. So I took the money. But then what happened is I couldn't get ahead of it because it kept selling so well that I had to go back and get a second one. It's called stacking. And so you get from another company and they go, 'they get a UCC and I go second in line.' And it's like 00:21:50 a. um a house of cards and dominoes it's basically like a ponzi scheme unless you're building them on top of each other and one failure along the way um can cause that thing to come crashing down at one point i'm having five thousand dollars a day coming out of my bank account i'm doing crazy numbers on amazon uh so it's no problem the cash flow i'm trying to get ahead of it and i'm making progress and i'm almost like okay i can see the light at the end of the tunnel here and then boom um i see something on facebook it says hey you know amazon uh doesn't always pay you for for damaged items and stuff this is back before there was a good tea there any of these guys um you can go into pull this Report someone posted a step-by-step SOP on Facebook this 2016, uh, spring 2016. 00:22:33 Uh, here's how to get some money back from uh, from Amazon, you know, for returns that customers don't return for things that they damage, you know. Prepare this report to this report send this in I'm like, man, you know, I know that's happening. I'm selling a lot of stuff. There's probably thousands of dollars, if not tens of thousands, hundreds of thousands of dollars on the table here. Let me do that. So I did that to Amazon. Within 24 hours, my listing was suspended. And I was like, what the hell? What's going on? Well, we're doing a venture because this product is over a certain price. You know, and you reported that these 10 were missing. We got to stop everything to balance it out. I don't know what the excuse was. 00:23:15 I was like, 'To hell with that.' Forget the bench. I don't care about the money. You just cut off my faucet, my water's quick running. I got to pay all this other stuff. And it backfired. And so I was down for two weeks. I'm down for two weeks, no cash flow, having to cover $5,000 a day on this debt. I never defaulted on the debt, but it was like I was robbing Peter to pay Paul, so I had to get another loan to pay the first loan, you know, to keep from defaulting. Because you default, they got a certificate of judgment. They go freeze your bank accounts overnight. You know, it's no lawsuits. There's no going to court. It's like you've signed it. It's notarized before they give you the money. 00:23:52 They're not fools. And so, and then two weeks down on Amazon on a hot selling product, and you know what that does in the algorithm. Anybody that's selling it, you know how crippling that is. I never, I got it back and I never recovered. It took me, I had to lower the price down to $49. And it took me until the end of 2016, I actually self-grew my entire stock of inventory. And then I just didn't do it again. You know, it; but I dug myself out of the hole, but it cost me hundreds of thousands of dollars in interest. It cost me a lot. And so that there's several lessons in that. One is: make sure she can afford whatever product you're doing. I should have never done that product. 00:24:35 In retrospect, why not do a $22 landed cost product with a 3,000 MLQ that custom built? It was cool. It was fun. I enjoyed it. It was a great product. People are still looking for it today, but I should have taken that money and maybe diversified that across three or four or five products. I didn't realize how fragile Amazon is, where they can just shut you off just like that. And totally, I didn't know the algorithms; I didn't know all that stuff. Um, and I didn't have the money to fund it, and then I took bad money, you know, bad loans. There's nothing wrong with borrowing money for your Amazon business, but you gotta borrow it really smart and do it right, and don't overextend yourself, and so that caused a problem that I had to dig myself out a hole on, and uh, you know, that's a big learning experience, so that that's the biggest mistake and biggest regret that I have, and I won't let that happen again. 00:25:29 If someone wants to put in a lot of money into an Amazon business, it won't always be all my money; someone else is going to bear some of that risk as well in exchange for a reasonable chance of return, but I can't bear all that risk. As far as how Amazon is different now from how it was six years ago, I mean, six years ago, There's several things. The tools are much more sophisticated now. The data is much more sophisticated. You've got a much more sophisticated seller and people in the space now. Five years ago, the private equity and the investment bankers and stuff poo-pooed this; they're like, that's just something. But now they're all over it because they see what it can do. 00:26:14 And now launching a product is, people always say, 'Is this a good time to launch a product? Has someone on Amazon jumped the shark?' I say, no, it's better than ever. It keeps growing. It keeps growing. You know, what used to be to sell 20 a day, you might have to have a $2,000 BSR, and now you sell 20 a day on a $10,000 BSR in some categories. You know, it's just expanded. So the depth, you know, versus the money, there's a lot of money in the niches. You know, years ago, you could sell spatulas for left-handed people, and you might sell two a day. Now, if you sell a spatula for left-handed people, you might sell 10 a day because the market's increased so much. 00:26:53 So there's those types of opportunities. Just going to Alibaba in 2015, you could just stick your logo on a product from Alibaba and do well. Those days are pretty much over. I mean, does it happen sometimes still? Occasionally, but now it's more brand building and differentiation and spotting holes in the market where people aren't good at Amazon. You can maximize keywords, they're not maximizing more. Taking a small piece of a bigger pie and being happy with it. You don't have to be you know, it's okay to be Avis. You don't have to be Hertz. You know, second place is okay for a lot of people. And there's still enough to go around. But on the branding side, a lot of people don't understand what branding is. 00:27:34 You know, they think the logo is a brand or a name is a brand. That's not a brand. So that's a problem in a third-party space where people think they're creating a brand and they're not. Or people get too They don't want to put all their eggs in Amazon. They want to diversify, and they do that too soon before they're ready, and they take their focus off, their eye off the ball. So it's a different game now. It's a grown person's game now. It's not a kid's game anymore like it was several years ago. But still, unfortunately, there's still this urban myth that you can do what you did six years ago and succeed on Amazon, and you can't anymore. I'm not going to say someone doesn't hit it; find a winning lottery ticket from time to time by doing that. 00:28:18 But it's pretty rare. Let's talk about brand building a little bit. We just had another, a lot of times we'll take over brands and they really haven't thought about their brand story. So it's super exciting, particularly when you have a product that has a room for growth. You know, maybe it's a top five, top 10 product, but we see an angle, right? Where if we just repurpose the packaging and give it a real brand feel and a messaging that's powerful, we can take it from position seven to position one. And we just redid packaging on a health and beauty product that it took us 180 days to actually execute because we had so much old inventory. But when it finally kicked in, this was about eight weeks ago, we moved right up to the bestseller badge in three weeks and they've held it ever since. 00:29:08 People just don't understand to me, and even good Amazon sellers, the power of branding. And what it can actually do and how it can change your conversion rate and how much Amazon cares about conversion rate. And to me, so what I wanted you to do is just talk about giving the everyday seller advice. If it's not their esoteric thing, they don't know branding, where do they start? What resources do they go to? Who do they look at? Who do they emulate? What are your thoughts? Yeah, branding is, like I said, it's not a logo and a name. I mean, that's part of, that's some elements of it. But branding is identifying with a person, making that person want to identify with you. It's a feeling. It's more of an emotion. 00:29:57 It's a feeling. It's a status symbol. I mean, there's like eight different levels of branding. But, you know, why does someone spend $1,000 on Louis Vuitton purse versus a $20 purse at Walmart? Yeah, the Louis Vuitton is probably made by hand and it's made a little bit better quality, better leather, but still it doesn't justify 20 to a thousand bucks. It's because people want to feel something as part of a brand. Why aren't people iPhone people versus Android people? Why don't they stand in line to get the new iPhone? That's what a brand, a brand evokes emotion and it evokes, it's a representative, it's a proxy for you. It says something about who you are, what your lifestyle is, what you believe in. 00:30:35 And that's what a lot of people, they miss out on that. A brand has to be consistent in its message, like you just said on packaging. Same colors across everything. The same message across everything. And brand doesn't have to be, you know, people think, well, I'm going to have a sports brand. Well, you don't have to have just, it can be a sports brand, but there's nothing wrong with being a brand that goes across multiple categories. It goes after a lifestyle. You know, it could be someone who's a runner. You might be selling products in the dog space because the runners, some runners want to run with their dog. So you have dog pods. You also might have something that they have electronics on that holds their iPhone. That's an electronic space. 00:31:11 You have something else that's in the clothing space that it's, I don't know, something to protect blisters on their feet, whatever it may be. So it doesn't have to be necessarily in a single category. But people on Amazon, I think it was someone, I heard someone else say this on. in another clubhouse, I'm going to steal it, is people on Amazon and e-commerce, especially, they buy photos, not products. And so if they're not familiar with what you're doing, you have to sell them without touching it, without smelling it, without knowing what it is. And so, an example of that, the example you just gave, we did the branding for this beauty brand and you guys jacked it from seven to number one. That's a perfect example. 00:31:55 And so many people are not willing to spend money on that. I mean, so many people are like, 'Where can I get something done on Fiverr for the cheapest?' Or why should I reshoot my photo? That shot on my iPhone, my buddy next door has a nice camera. He shot these for me in the backyard. Why the hell should I go spend thousands of dollars on a nice photography with proper lighting or 3D or really good 3D graphics or whatever? I'm selling $20,000 a day anyway. It's fine. I'm like, well, would you want to sell $50,000 a day for a small investment? And most people just don't understand that. They don't get it. 00:32:27 A perfect example, if I can tell you just a real quick story of this, is one of my first products back when I first started in 2015, I actually launched this in 2016, were bully sticks. And bully sticks were, you know, back then, I think the searches for just the word 'bully stick' was like $50,000 a day. It's probably way more than that now. But it was a strong, strong seller. And I was like, You know, so I started looking at it like, look, all these people are doing bully sticks and they're putting them in these plastic bags with a label on them. They're getting them from some, you know, packager, packager sticking a label on it and put it in a plastic bag and selling 30 of these bully sticks for 30 bucks. 00:33:05 So I started looking at it like, how can I differentiate this? Where's the opportunity here? If I just go find another pro packer to do the same thing, how am I different? And so I started reading all the reviews. This is before Helium 10 had a review downloader. I was actually using, I don't remember how I did it. I think I did it manually. Downloaded a whole bunch of reviews, combined them all and started reading. And I started seeing that people were complaining about the bully sticks. They're concerned. Are they from China? Are they from Brazil? Where's this meat from? I'm like, well, I can fix that. Let me make sure mine is USDA certified meat or whatever. It's from the US. And they're complaining about these things stink. 00:33:38 You know, when the duck, because bully sticks are actually the penises of the cow. Most people don't realize that, that it's actually the dried out penis of the cow. And so when the dog chews them, if they're not properly prepared, they can smell like urine. And so that's a problem. Another one people complain about is when the dog grabs it and goes and jumps on the couch, jumps on the rug, you know, some water, some juice gets out and stains. And I was like, how can I fix all these problems? So I get on the phone and start calling all over the U. S. trying to find someone that can make a higher quality bully stick. And these people pointed me to this guy up in like Connecticut. 00:34:14 And he said, oh, if you want the highest quality, you gotta go with this guy. And so I called, he's a small little manufacturer. I called him up and he said, yeah, I'm a classically trained French chef. I said, boom, right there, that's a brand. Classically trained chef, French chef making dog products. And he's like, yeah, I do this 15-step all natural organic process. I only use US meat, but mine are really big and thick. You know, everybody else's are like straw size. Mine are like big and thick. And I was like, well, so how much are these? I forgot the exact price he told me at the time. Let's just say they're five bucks a stick. I'm like, five dollars on Amazon to eat on this. I'm like, well, that's what I do. 00:34:54 I'll send you some samples. He sent them to me. I tried them on my dogs. They loved them and they lasted a long time, longer than the other ones. Didn't have any of the problems with smell. Didn't have any of the problems with the leakage or whatever. I was like: 'How can I position this on Amazon and make this work?' And everybody always thinks on Amazon, it's all about being the lowest price. And that's bullshit. It's not. It's knowing your market and knowing your brand and knowing what you're going after. So what I did is I like, okay, let me take these and I'm going to go at the really high end of the market. People love their dogs. They're willing to spend money on their dogs. 00:35:25 Some people, some people, it's just an animal in the backyard. It's the cheapest stuff. But other people, this is like their child or their partner. They'll spend money. So I took three of these sticks, they're 12 inches long, and packaged them instead of in a plastic bag, I put them in a cigar box. I found a guy to make in Brooklyn to make cigar boxes for me because I did Brooklyn because he's close to Connecticut so he could ship up. I found something in California was like cost to ship across the country and that's adds to my cost. So he made these really nice cigar boxes for the custom-made cigar boxes. I put three of these bully sticks in the cigar box. And I had a nice label made from this company in Colorado. 00:36:00 It had this nice texture on it, like a little feel and stuff. When you feel the label, it felt like really high-end. And I had them clothed each other enough so they weren't shrink-wrapped. And then I did a 12-inch version and a 6-inch version. My three sticks in the cigar box, I put them up on Amazon for $54. 95. Now, you remember, everybody else is crushing it on Amazon, selling 30 sticks in a plastic bag for around $30. Now, can I compete on the word bully sticks and actually win? Probably not. Because everybody else on that price is around a similar price point on the word bully stick. But can I compete on bully sticks made in the USA or bully sticks no smell or no odor or some of these other keywords? 00:36:42 They still had enough demand. And so that's what I targeted. And I got to page one on most of those. And people started buying this. And then Best Bully Sticks, still is one of the biggest in the space. They reached out to me and said, how the hell is this guy selling three sticks for $55 on Amazon? And I did it. How did I sell it? It's all with what you said with branding. So the imagery, the videos that I did, I had a guy, an influencer that created a video where he compared ours to others. And he actually smelled it across his nose. And it was just a powerful video that gave the message. In the imagery, I had, you know, dogs wearing chef's hats and eating the things with a happy smile on their face. 00:37:23 I created cartoons where I would show a bunch of dogs in a car going to a McDonald's type of place, a fast food place, and show the menu of all these cheap bully sticks. And then I would contrast that in the same image with a, you know, cut down the middle with six dogs around a table at a really nice steak restaurant with a maitre d' with a bow tie, you know, serving them on a plate. That's branding and connotating an image, that these are high-quality, these are good, these are great. Um, and that's what I did, and they sold. Was I selling 100 a day like the other guys? No, I was selling 15 20 units a day, but my margins were way better. I'm making more money than the guy selling 100 a day. 00:38:03 And, and it worked. And I had got one guy order from me like 72 times now. The price I ended up stopping to do it after some time um because the price of meat kept going up and up. The Chinese were taking a lot of this meat and stuff, so the price my margins got squeezed on it. So, and and I guess I kind of so I ended up not doing it because it just... I focused on something else. But I did that for like a year and a half, and it did well um, but that's the that's the power of branding and messaging, and that's what a Lot of people miss on Amazon, they think it's all about price and lowest price and highest volume, and it's not. 00:38:40 There's so many opportunities if you do it right. And the audience and the traffic that you have, if you're just sold on Amazon, is unrivaled except for Google or YouTube. And what's Amazon's third biggest search engine for? Something like that. You have a major opportunity to get in front of them. And if you do it right, there's so many freaking opportunities that most people just don't think about or don't approach or don't do. With branding too, you have to integrate a little bit of craziness sometime, which you did. It's like your idea was wacky, right? But it was really compelling to your user base. And for me, I love doing that. Another thing I love doing with branding is, well, I test the crap out of it, right? 00:39:22 I will use PickFu and I'll try 30 different variations of something till I get one that's a clear winner against my old design and against my competition. And one of the things that I really like to do is lay out, all of my competitors, what they look like and what they feel like, and try to do something that's generally the opposite. So, in this foot spray that we're now the best seller in, everyone else had this sort of like hippie, crunchy, whole foods vibe, natural ingredients. And I was like, the missing space here is like the Right Guard Extreme Deodorant look. Something that speaks to power, like it has a name like Cool Blast. And it just speaks to like a different audience entirely. And it's just going to stick out no matter what. 00:40:09 Everyone's going to be thumbing through and it's one of these other 24 things. And there's this one that's entirely different. It gives an entirely different feel. And that's the sort of thought process that all of you should be doing as you start considering what am I going to do with my branding? You have to look at the landscape. You have to explore, try wacky things, test them. And then really make sure that you have something that's different and feel special and compels emotion in people. And that's when you get successful wins. And some of our biggest individual product wins from an optimization standpoint, brand and work on PPC aside, has been from some of these branding rehabs. Yeah. I mean, I think that's a great opportunity for like aggregators like yourself. 00:40:56 You come in and someone's proven that, hey, there's a market for this. People are willing to buy at this level, but if you could take it to the next level, and that doesn't always mean expanding to other marketplaces. That just means proper branding, you can explode something. And I think that's where our background work opportunities are on Amazon, and there's tons of that out there. There's lots of people that just don't have the skill set to do that. They have the skill set or the luck to happen into something that's working, but just imagine what you can do if you take it to the next level. I mean, look at what Apple did. Apple's all branded. You know, from the original Apple II to when Steve Jobs left and when he came back, that's all branded. 00:41:34 And turned the whole thing around. Now it's one of the most valuable companies in the world. When it was on the brink of disaster and had to have a $10 million loan at one point from Microsoft to stay alive. So, business, all business, it's perception. And perception is reality. And that's in relationship and business and everything. And business comes down to, all businesses come down to two fundamental things. It's marketing and innovation. Those are the two driving factors that are going to determine your success or failure the most in any business. I mean, human capital and all that's important too, but marketing and innovation. And so marketing is crucial. Marketing is part of branding. And that's where a lot of Amazon sellers are just missing the boat. Yeah. 00:42:21 And it takes patience too. I think a lot of sellers are so focused on the next hack or the next way you can drive traffic or get reviews or fix something, where that might work for a little bit. But if you're missing the bigger picture when it comes to the whole picture of branding and marketing, how it all actually plays together, that's how you build a successful business that lasts. I agree. I agree 100% with that. But like you said, a lot of people, they do want that next hack. What's the coolest thing that's working on Google to drive traffic to Amazon? What's the latest man-made tech trick? How can I get reviews? And people always ask me, how do I get reviews? I'm like, put out a damn good product and wait. 00:43:01 Put out a damn good product, sell a bunch, and wait. You don't need to manipulate it. If you're fixing someone's problem, they're going to respond. But people still want those hacks. So I have a billion-dollar seller summit that I do. And the speakers that I bring on that, it's very curious. I get people that come on and say, hey, I'd love to speak about mindset or about whatever. And I'm like, no, these guys, that's great stuff. Don't get me wrong. But these guys are paying $4,000 or $5,000 a ticket to come to this event because they're seven, eight, nine-figure sellers. They want that one little thing that they can go back to their team and implement. And at their level, it's going to make a. 00:43:40 Six or seven just probably a six-figure difference you know for them almost right away, so that's what we have to focus on that versus like a Helium 10 elite, that I do, that's more than it's a different mindset that I do for him internally, that's more of the branding and more of the long-term play type of stuff and the mindset and that kind of thing. But yeah, it's you're right, a lot of people, that's all they want, especially at the beginning, when they're first starting, they're like, 'What's the shortcut to success?' There isn't one. No, All right, let's jump into some questions. We have our first question from Gary. Gary, welcome. Okay, hello, everyone. Hi, Gary. Hi, my name is Gary Newberg, and I am from New York City. 00:44:25 I am a proud member of the Amazon Product University that I joined in May of last year, and I joined their AX10 Advanced Program as well, so I've got a lot of knowledge under my belt. We have an accountability group that meets once a week, and they were talking about this new program, the FBA New Selection Program, where you get $200 credit for your PPC, $100 credit for shipping, and I just wanted to know a little bit more about that. Does anybody know about it? I'm not familiar with that one. Yeah, I'm not familiar with that one. I mean, Amazon's always doing little things to get more people in the ecosystem because even though when we fail, they still make money. Amazon never loses money on us as a seller. 00:45:12 They're taking your ad money. They're taking your listing money. They don't lose money. We're the ones that lose money. So anything they can do to get someone in to give them 200 bucks. It's to their advantage. Is that something that I don't know enough about it, but if they're offering free stuff, as long as there's no catch on the backside, I don't know if there's a catch on the backside where in exchange for that, they're offering you some additional higher percentage. I don't know, like Launchpad, they take 20% instead of 15%, for example. Sometimes that's worth it, sometimes that's not. But I don't know enough about that one. To give you advice if 00:45:51 it's good or bad understood, yeah I also had a question too about crowdfunding and Kickstarter which I learned about oh god what was it Gary Wang's 80/ 20 thing or Seven Figures Summit I watch all these videos you know the YouTubers like um Trevin Peterson and Paul Savage I'm watching videos every day Helium 10 Freedom 10 or Freedom Ticket all that stuff and I've learned about Kickstarter and crowdfunding too, I mean does anybody have any success with that, kicks, crowdfunding, like Kickstarter, Indiegogo, the two biggest ones. They can be they can be great. But you have to remember, too, but it's probably a higher failure rate on Kickstarter and Indiegogo than it is on Amazon. But most of the people that are successful on Kickstarter or Indiegogo are actually not people rubbing nickels together. 00:46:34 They're people that actually have a million bucks in the bank and they're selling. They want to raise twenty thousand dollars on Kickstarter. Hey, hey, hey. Oh, yeah. Well said, Kevin. We've had some success on Kickstarter. Look, it really can be a boost to your Amazon launch. There's no doubt about it because you run the sales through Amazon. But you really have to understand the Kickstarter audience and what those people like. So you have to understand their mindset. They want differentiated, generally tech-oriented. Novel products that really stand out and maybe also have a really sleek design aesthetics. Those are the ones that can crush on Kickstarter. If you don't have those factors in there, like you can put a lot of effort into it and your Kickstarter will go nowhere, right? 00:47:25 So we've definitely seen both of those things happen. You just really have to understand their audience if you're going to have success. That kind of sounds a little like Shark Tank to me. A lot of that. It's like selling on Amazon. If you understand the algorithms, there's algorithms on there. And there's certain things to do about what you want to set your rates at and how fast you see that for social proof. And a lot of the success, Kickstarter is great. It can be a great way to launch and get publicity. But for someone that doesn't, if they're like, I got five grand, I need to raise 100 grand for my product, your chances of it working are much less than if you have a lot of money and you're using it as more of a market tool and a launching tool. 00:48:06 And it can be great, especially if you have an audience built already that you can drive to that. Those are the ones that are typically the most successful. For sure. And you want to hedge your bets. So for us, we'll always have a direct DTC site, Shopify site, right? That's tied to our Kickstarter that's already built. And we can take email lists and outside traffic and other things. Makes levels of the playing field or increases your chances of success if you have it. If you don't have those things, your product better be pretty damn neat and special. You better have an awesome video. You better kind of know direct marketing tactics to push people. And you better make a very compelling offer. But we see it as not a moneymaker for us, but a launch facilitator. 00:48:54 And that's all we see Kickstarter as really being for us. And you got to be careful on Kickstarter too. I mean, on the IP side, I mean, if you have a great idea that you put up on Kickstarter, you are basically showing it to the world. And if you're slow to execute on that, you know, some people, I've got a Kickstarter now I'm waiting three years on since I funded and they're still sending me updates. We're almost ready. But in the meantime, other people will see something and they'll iterate on it or they'll do something there. So you got to be careful. on that aspect of it as well. Okay, thanks. I also want to let you know, Kevin, I really do enjoy the Freedom Ticket. That's really just an excellent, excellent teaching tool. 00:49:33 I appreciate that. It's nice to see you outside of your trademark blue shirt. Yeah, I have to wear those blue shirts all the time. I appreciate that, man. Kevin, hi. Thank you. Thank you for a very sincere story. It's very great cases. My name is Wall and I really enjoyed what you were telling from your experience. Very open and sincere cases. So I know we are all here not in equal positions because I know John was studying the Korean theater and I was talking about these videos. He was really good at that, definitely. So like talking about the videos and where Amazon is going right now. We see that in China, Pinduoduo, this is all this. Video commerce is expanding, right? It seems like Amazon is going there. 00:50:23 So what are the limits of these videos that we can put on Amazon to put our products ahead of others when we study? Any other kind of limitations we have and trends? Because Amazon definitely wants us to do more videos. Yeah, I mean, Amazon, I agree with you. China is way ahead of us on video commerce. They're way ahead of us on a lot of stuff. A lot of people, a lot of Americans and people in the West don't realize how advanced China is on some things until they've been there and seen it. But so that's a cultural thing. So I think it's going to take a little while for that to happen if it happens in the US to the level of what video commerce is doing in China. 00:51:03 But as far as Amazon goes, you know, Amazon Live is something that they're really putting a lot of emphasis on. It's still kind of a 'it's still growing'. We'll have to see where that goes. They've opened it up now where you can put videos in your listing. Even if you're not brand registered, everybody should be doing that. Probably the best opportunity for video that I'm seeing right now on Amazon is in the sponsored brands. Those sponsored brand videos take up the spots of four products. It's major real estate. If you do that right, I'm seeing tremendous success on Amazon with those sponsored brand videos. And a lot of people don't do the video right. But if you do the video right, I've seen it dramatically increase conversions on a lot of products. 00:51:49 And right now, because a lot of people still aren't doing it, the cost per click and cost per conversion on that is lower than what it would probably be in a year or two from now. So that's one I would really focus on as far as Amazon. And what can you do or what can you not do in that? I don't have a list. I don't have like a bullet point list of like, here's the do's and the don'ts. But you've got to show them that video in a short amount of time. Remember the first three to five seconds of the video, you've got to catch their attention. They're not going to watch the rest. So you've got to come out with a bang, with a powerful message or a powerful image or something at the very beginning of that video. 00:52:27 And then you've got to compel them in 20 or 30 seconds or however long the video is. Then why should they emotionally be? Tied to your product and why is yours better than all the other alternatives if you can do that um in 30 seconds um you can have a very successful what about great humor right how how audience take humor uh good or like any experience with that like if you put a really good humor and you catch the audience do you think it works or not what's your experience i i have experience i'm sorry yeah i think i think it depends um i would be careful with humor. For me, this is the reality of using humor, and we do it on occasion. 00:53:08 If you're going to be funny, you better be freaking funny, right? Don't try to do this corporate half-ass. If you're going to try to push the line, you actually have to go to the edge. And so when I try to produce humorous content, which makes up about 5% of total what we do, right? And we're actually working with one of the most famous comedic actors in America right now on a project. You really have to commit to it. But I always shoot B-roll or have backup creative that's boring and just stagnant and stale in case it's a total flop. So, that's what I do-I'll push it as far as it can go, right? So, it almost makes people uncomfortable or sometimes it does. 00:53:49 And then bring it back to the middle ground, and then have a clean one if it flops. Because it's really hard to have a ubiquitous collective understanding of humor. Very few people have a natural knack to it. And so you just, and it often comes out as inauthentic or campy when it's not done right. So you gotta be careful, but when it hits, it can really work. Can we take humor with Russia team? Like if it's funny or not. Maybe, maybe. Brandon, any other thoughts? No, I was gonna say, I agree with that. I mean, you also never know what Amazon is gonna approve. So it's good to have content that you can splice and they're gonna come back a couple of times and try to figure out. 00:54:31 And they don't make it easy to figure out what is not approved either for some of these things. But to Kevin's point, like sponsored brand video is probably the lowest hanging fruit on Amazon right now that most people are not taking advantage of. I agree with that 100%. And just think about it from a psychological perspective as just a general customer who doesn't even understand third-party. They think kind of everything's sold by Amazon. It's a big portion of the audience. They scroll through and they see a video after they've already seen maybe one of your ads or your organic listing. You've now had two to three impressions and it stops their thumb and gives them a sense of legitimacy that this is the product that Amazon wants me to see. 00:55:11 It's super powerful when it's used. And we've seen definitely that gets. it's worth focusing on. Exactly. And advertising in general is just taking more, more prominence in the SERP in general. Like when you look at how things are changing over time, organic is there's less organic spots, more paid spots, there's sponsor brand video, there's editorial sections. So it's trying to figure out how do you, how do you get into all these spots? Cause it's the, the page is always changing. Yeah. Thank you. And the last note on humor, like I, It is sometimes worth experimenting with. I wrote a funny story in the back of the labels of our products. And there's at least 15 reviews on the product that talk about what a funny detail it was. 00:55:52 And it was the reason they left to review. So it can work, right? But you just like, you have to understand you're playing with fire. That's what I'll just leave it at that. Yeah, I will give you one example. We usually, we had these stickers and one of them, I learned this phrase, morning wood. It was new for me, right? So we put a little sticker in our fire stars. And it works well, actually, because it has few layers, right? So it was fun. All right, cool. It's fun. All right, we got two minutes. And what else we got? All right, so we have two questions left, which is good. OK, so the next question we have, do you have to start with your best-selling product, or is it OK to start with one medium-selling product just to learn? 00:56:33 Well, if you're starting, you don't know what your best-selling product is. Exactly. So I guess, but. I see what a lot of people do is they go after products that have higher potential or higher search volume or something as their first product. And no, that I've actually advised against. And I would advise as your first product, if this is new to you, start in the lower third of the marketplace. Now, if the top keyword, if you've done your keyword research and the top one in this space is 50,000. Divide that into sections of three and if the 67th percentile down, it starts at $3,000 and below, that's where you start. It's going to be easier and less competitive and you're going to get your feet wet there with less risk. 00:57:19 And you can always, if it works, you can always grow and expand up and don't lose sight of that $50,000. You're still going to incorporate that keyword into your listing, maybe even into your title if possible, just so you get a little bit of love and can start that slow process of rising. I agree with that. All right. And our last question from Sergi. Hey, Kevin, been following since AM PM episode 33. Have you had success with posts? I've seen some engagement rates in the three to five percent range on some. Love having free real estate on Amazon. Have you been able to track conversions from posts? Posts are hit or miss and we experimented with our PPE product and it didn't work. Some of them got a lot of exposure. Originally, Amazon didn't actually show you clicks or anything there. You just shot them blind. Now they actually are showing you some click-through and stuff, but I still don't know conversions. 00:58:28 You know, if you got a VA that's creating some content for Instagram, some other places already, it's going to take them an hour a week, you know, to create something and throw up an Amazon post and schedule them. It's not going to hurt, I don't think. But should it be a major focus for most people? I'm not so sure. Maybe in some of the beauty brands or some brands that might make, you know, a bigger difference. But we're doing it in a dog brand and we're doing it. And the PPE, I can't say that it's probably a waste of time. The dog brand, I think there may be something there. But like I said, you know, if it could be a byproduct, it doesn't hurt. All right, great. Well, this was an excellent episode, Kevin. Thank you so much for spending some time with us. Brandon and I have to go to a meeting and meet with the suits. So great to see everyone. Hope to see you all next week. And Kevin, thanks so much again. It was a great episode.