Why You Should Fire Your Amazon Service Provider
Well it’s been almost a year since our last blog post and in order to get ahead of things, I got that annual post done a bit early. Here we go....
With 1.9 million active sellers on the Amazon marketplace, in order to succeed you need to stand out.
Mediocre doesn’t stand out. Mediocre says, “this will be enough to help us get by.”
Average says, “we’ve met the requirements, now let’s sit back and enjoy what comes in,” only to never enjoy the spoils because the spoils never appear because the desire for meeting the requirements isn’t as strong as the desire to achieve more for oneself.
Let’s set aside all pretenses around what success is and what it should be. In this case, success means you sell more than most and you’re able to earn a living running your brand. Sales numbers are annual from here on out.
The biggest sector of sellers on Amazon, 20%, generate approximately $60,000 in revenue each year.
The next largest segment? Well, they earn around $6,000 in revenue, making up 6% of all sellers or brands on the marketplace.
Being average at a hobby isn’t so bad, considering most people don’t earn a living with their hobby. But being average in running your business won’t pay the bills, not for very long at least.
AVERAGE BEGATS AVERAGE
It should be pretty clear at this point that being able to sell enough to earn a living on Amazon takes more than average knowledge, which those earning $6,000 - $60,000 in sales possess.
So where are brands turning to find this knowledge in order to get where they’ve never been before?
They’re turning to professionals.
They’re turning to experts. Amazon experts, to be precise.
So just where are these experts coming from since Amazon only opened up access to all brands in 2000 and majority of the sellers on Amazon aren’t simply raking in the cash, since only 16% of sellers make more than $600,000 in revenue?
They’re coming from all over the place but a couple of main places. They’ve left Amazon and have started their own consulting business, they’ve sold on Amazon previously or are still selling on Amazon and are now helping other brands to succeed, they’ve worked at a service provider that has learned how to manage the presence of a brand on Amazon, or they’re charlatans.
Whoa, whoa, now hold up just one pretty little second.
What gives you the right to claim some service providers out there are alleged charlatans.
That, my friends, is an excellent question, to which the answer is two-fold.
To start, I’ve seen their work. How?
When I’m in the prospecting phase with brands, I often get access to their accounts temporarily to be able to look at data to determine what kind of opportunity is there. Many times, they’re already working with someone on their account, that’s why they’ve come to us because their results are average or worse.
This is where you ask me why the brands aren’t just pulling the reports and data themselves to send to me so I can review them?
Why aren’t brands going in and just pulling reports so you can review those? Why the need for access to their accounts?
Because those brands don’t often know how to maneuver their accounts, which is a scary concept because they’re representing a brand that is potentially being seen by millions of people, for better or for worse.
So when I’m given access to the accounts I’m digging into business reports, advertising campaigns, the back end of listings, the whole kit and kaboodle. Once I’m in, I’m often astonished at what I find.
Mediocrity.
I see listings that are missing lots of important attributes that are preventing the products from being seen. I see advertising campaigns that are set up like Jackson Pollock might do, had he been an Advertising Specialist on Amazon.
Keywords are just thrown into campaigns with no rhyme or reason, and sometimes the keywords have no relevance to the product, think of a keyword or target such as “fish bowl” for a product that is a dog collar.
I get adjacent category targeting but c’mon!
So I’ve seen the poor quality of work. It’s out there and it’s hiding in plain view.
How else can I vouch for this freakshow of Amazon consultants, agencies, service providers, whatever you want to call them? Not a week goes by that I don’t hear from a brand that they’ve “been burned by a few consultants already.”
We actually take on these clients, having scars from the bad experiences of the agencies that said they have Amazon capabilities, only to find out they didn’t. Either their product listing took 4 months to get live on Amazon, and not due to any of Amazon’s normal hoop jumping, or they’re agency is spending advertising money like crazy with only a 0.3 RoAS, for months. Working with them involves an intense focus around building the relationship due to the loss of trust that occurred in previous relationships. This now hurts their business even more, long after the initial instigator is gone. How?
They question everything and self-sabotage by not wanting to commit to any one strategy. They don’t want to spend money on ads because they’ve “spent money on ads before and it doesn’t do anything,” which delays their progress because in order to be seen on Amazon, you have to be utilizing advertising to get proper placement. This is even more important when your product has low sales volume to begin with and isn’t showing up on page 1 without paid ads.
So it’s taking even longer for them to grow their business. All because some dudes or ladies wanted to act like they knew what they were doing when it comes to Amazon. In other words, they were great sales people but they couldn’t deliver.
RETAIL THERAPY FOR ECOMMERCE BRANDS
So how do you deal with shady marketers and agencies?
You eliminate them. How do you eliminate them?
You don’t give them business. If you’re giving them business, stop!
How do you know when to fire your current agency? Or not hire a prospective agency?
Ask them this question and if they can’t answer correctly, give ‘em the ole boot.
What is Jezz Bezos’ middle name?
Haha, I kid, I kid.
Here’s the real question; how is Amazon unique from all other platforms?
If they don’t say some of the following, they’ve got no clue what they’re doing:
The visibility of your product in search results on the Amazon marketplace by consumers is impacted by advertising, which no other channel can claim, i.e. advertising can impact organic rank because a sale is a sale, whether it is from a paid or unpaid placement on a keyword. All sales go to the product listing and that product listing is what Amazon’s search algorithm is evaluating, namely sales history and sales velocity, not whether the sale came from an ad or an organic search.
Amazon isn’t just a marketplace. It’s also the largest product search engine (54% of people go to Amazon first to find products), that also sells the products, hosts all of the information, develops the website, processes the payments, ships them, delivers them to your door, and takes the returns. They’re an end-to-end ecommerce solution.
Majority of consumers searching don’t go past the first page of results to find the product they’re looking for and Amazon is actively incentivizing consumers to not go past the first page with engaging alternate search suggestions, reinforcing the need for advertising.
If you ask this question and start hearing answers about “how Amazon’s product ranking system…” or “the A9 search algorithm is very unique in that…” or “it’s the largest marketplace in the US” or “Amazon’s review system...” or basically anything that doesn’t speak to how ad sales and organic sales work together on Amazon that is an entire ecosystem, run for the hills, The Weeknd optional.
WHAT NOW?
Do your research.
Don’t believe what an agency says. Have a healthy level of skepticism until you’ve seen results to validate what they’re saying, either in the form of articles, reports, or case studies.
Any good agency has case studies that do NOT just show you a cryptic screenshot from the Amazon Advertising dashboard of how they reduced ACoS (Advertising Cost of Sale) for this brand and that brand.
Ask them if the brand was profitable. Not every brand is trying to be profitable on Amazon and that’s okay. But ask them and see if they’re honest with you or if they start to squirm.
Look at multiple service providers and take your time. If someone is in a rush to get you in, be it for a sales cycle or running some kind of end of the month deal, they’re not your people if you really want to succeed on Amazon.
Until next time...
About the Author
Article written by Michael Maher
Michael is the Chief Idea Officer of Cartology, a custom done-for-you services agency helping brands grow revenue and become profitable on the largest marketplace in North America. He loves hanging with his wife and daughter close to the beach, great bourbon, R&B music, good coffee, and hanging around a fire. 🔥