Originally published on July 18, 2019, updated July 1, 2020
Liz Fickenscher sat down with Joel Wolh of Boutique Seller to talk about Amazon advertising tips, preparing for Q4, and what might be next for Amazon sellers.
After becoming fascinated by the concept of manually converting customer search terms into keywords, Joel Wolh came up with a process that worked. By combining a hands-on approach with automation, Wolh built an agency dedicated to helping Amazon sellers navigate the often confusing world of advertising.
Boutique Seller works with clients to create a whole new strategy every single month based on a variety of factors including trends, seasons, and how the business was performing the previous year. “We’re like a partner that helps you grow your business, watch your dollars and tell you if you are spending too much, even if it’s on our fees,” Wolh explained. “Having our clients’ best interests at heart...I think that’s how we differ from most others out there.”
Every account is very different, which means that the timing is going to be tailored to each business’s needs. The Hunting & Fishing category, for example, is seasonal and just starting to wind down when preparation for Q4 begins. By September, though, Wolh says that it’s best for sellers from all categories to have a very action clear plan for October, November and December.
Sellers who have been on Amazon for more than a year should base their strategy and ad spending on their performance last year. It’s tempting to simply throw money into advertising during Q4, but it’s much more important to have a very clear plan with equally clear objectives.
Many sellers are in the dark about advertising strategies, which is why they need agencies like Boutique Seller to help them avoid spending too much money. “There’s no one-size fits all for sellers,” Fickenscher said. “It’s really a nuanced thing that you have to both think about strategically and implement strategically for your particular store.”
Always look at your numbers before making decisions. “I’d say typically 8% on gross Amazon sales as an ad spend, that’s okay,” Wolh said. “You go to 15-20% and you’re cutting into your margins.” When you spend that much, you may not make any money after covering costs such as storage fees, shipping, and returns.
Watch the video to hear the entire discussion.
Liz: Hi everybody. It's Liz from eComEngine. I'm so excited to have Joel Wolh with me today. He's from Boutique Seller. He knows everything about advertising on Amazon. It's prime day today. Well, a lot of things. But it's prime day today and the next big thing is Q4. So I've got Joel here on one of the busiest days ever. And he's going to answer a couple of questions about advertising, Amazon, social, just our whole space. Joel thank you so much for joining me today.
Joel: Sure thing. Thank you for having me here.
Liz: So tell me about the beginning of your Amazon journey. How did you get started in this crazy industry?
Joel: The beginnings are not really important. You want to know what's going on now. But no, I'll tell you. I'll tell you. So I got into Amazon because I was in consumer products in different capacities. And Amazon was sort of a natural outgrowth of being in consumer products based business. And I ended up working on one account with the app. I was very intrigued by the concept of customer search terms and manual, I guess just you're, I remember what I was feeling. I remember where I was actually when I heard this concept for the first time of manually converting customer search terms into keywords and knowing exactly what they use in order to get to that order and being able to re target others with those words. I was like wow, that's genius. Obviously the concept is not new to Amazon, but I thought that was a game changer and I decided to immerse myself and I did, and I don't immerse myself very, very often. But when I do it's all in.
Joel: So I came up with some kind of process that worked for me. Started helping out a couple of others, kind of like friends and relatives in the business. Just brainstorming and that's when I knew at some point that actually I have a business here and get away from the China importing, getting dirty with boxes and schlepping and all that stuff and just sit at the computer and click, click, click. And that's what happened and I just kept on evolving, I learned everything there is to know. I learned that most people out there don't really know what's going on because you really have to do hundreds and hundreds and hundreds of A/B split testing. And which is what I was doing over and over and over again. I found a process that worked and I built an agency and it's been a couple of years and we're doing really well.
Liz: That's awesome. How does Boutique Seller differ from other agencies that work with Amazon sellers in the advertising space?
Joel: So I don't like really talk about my competition. I want to say that I'm not knowledgeable enough about what they are doing. I mean, I know a couple of big ones that we take over accounts from all the time, and I know that I see what they're doing is wrong. So number one on the process itself. So there are two kinds of Amazon ad agencies. One is where you get an account manager and they do everything for you manually. And some are better than others. I've seen some that do atrocious jobs just in the simple operational, just their operational skills. And then are different agencies that mostly use automation. And there it comes down to number one, how well their automation is built, what variables are they using? How often are they changing it? And then what information is and what changes are the clients, what are they inputting? How they tinkering with the software.
Joel: So we have the process down pat, we keep on improving it. And we have a hybrid model where we have software that helps us on the backend, but the client doesn't touch it. We talk with a client usually monthly, but sometimes a lot more than that. We create a whole new strategy every single month, based on the holistic look of the account. What's going on of trends of where they were last year of seasons. So we are almost like a real partner that's helping you grow your business, watch your dollars. We'll be the first one to tell you if you're spending too much, even on our fees. If your account can't sustain our fees, we'll say, "You got to give this a break," or maybe we'll give you a break for one month or two. So having our clients' best interest at heart, I think that's all there is because once you have their best interest you find the best way to make the ads work for them. I think that's how we differ from most others out there.
Liz: That's awesome. So Q4 is approaching and obviously it behooves an Amazon seller to think about their advertising strategy and sort of amp that up with the anticipation of better sales and more revenue. When should they start thinking about that? About amping up their advertising strategy for Q4?
Joel: Behooves, it behooves. I'd say October, November, December. Mid September is when they really need to... Well don't forget that our back to school, like every account is very different. I mean, the hunting and fishing, I mean the fishing category, that I feel like winds down Q4. But if you're in a category that's going to see a jump in sales in Q4, and most categories are, then you need to start in September. You need to have a very clear plan of what you're doing for October, November and December. And it's got to be based on last year. If you have a history, historical sales or facts on the ground like what are the sales looking like in August, September? What do you think they're going to look like? How much can you dedicate towards ad spend and what exactly is your objective with that? So it's easy to say I'll ramp up your spending, but what does that mean? What does ramp up your spending mean? So it's got to be very, very quantifiable, right?
Liz: Right. Strategic.
Joel: Yeah. You really need to know how much are you spending on what and what are you getting in return? I've seen far too many accounts that just.... Well it's it's prime day, you must spend, it's December, we must spend. Why must you spend? Are you being profitable when you spend? So that is always the concern. If you know your profits, if you're an Amazon seller that understands how far you can go, and I say typically 8% on gross Amazon sales as an ad spend, that's okay. You go to 15, 20%, you're cutting into your margins. You can do a million miles in sales in December. You might not make money after ad spend, after storage fees, after shipping and returns and all that stuff. So one has to be, one is behooved to be very careful what their plan is in the Q4.
Joel: And I think that people treat Amazon ads way too much like a casino, not in a way necessarily that they're just spending like you would in a casino, but they, it's like, Oh let's throw some money here and see what happens. Let's spend the what do you call that thing? I don't spend too much time in casinos, the roulette wheel, right. You don't either? We'll spin it and then we'll press this button and then we'll go to that gamble. And I'll start ACE and targeting, and then I'll start an auto and I'll start a manual. Like it's not a game there. It's not exactly math right. And it's not exactly a science and it's not exactly an art, but it's, I like to say it's a mix of the three and you do, there are strategies that you can apply. And it's important to deploy a very specific strategy based on your very specific objectives.
Joel: I'm very serious.
Liz: You are very serious I like that about you. So when somebody is thinking about that, being strategic and the different strategies that you hear about when you talk about advertising, both on Amazon and off Amazon, I hear a lot of people asking whether or not that they should be focusing on common keywords or more long tail keywords. I hear people asking about bidding on their brand name and their competitors brand name and all that kind of stuff. Do you guys factor all that into your conversation? Do you see sellers making a lot of mistakes with those types of things? Do you feel like that is very, very specific to your niche or what you're selling or do you think that's more of a general strategy and best practice to know the ins and outs of those?
Joel: The general strategy is to follow the numbers. However, every single account and every single product, mainly you can have two accounts and have the same product in both accounts and there'll be different or meaning the results will be vary. Or two different products in the same account, obviously as well they'll have to have different strategies. So when it comes to brand names like how, I'll give you an example. We took over a very large, let's just say fashion brands, not too long ago. Their ads, the numbers were looking fine. They had a 10% spend, like a 25% ad sale to total sales ratio. It looked very balanced. But then when we dug in, all their ad spend was dedicated towards defending their... And whoever managed, this super big agency that managed their ads, they were every, nearly every campaign was called a defensive campaign. And they were just mostly narrowed in on the brand name. Now the brand name, you should own that at a very low cost, typically.
Joel: And if it's a private label brand that most people haven't heard of, then you're not even dealing with that because ultimately the proof is in the pudding in this case, it would mean it would be in the report, in your search term reports. You would see are people looking for your brand name? What's the conversion on your brand name? What is it costing you? What's your a cost. In this scenario I mean, it's a well known brand, if they're already seeking that product then it should not be a very high cost of acquisition. And they were just spending a lot of money on that. So we have to break it up, create a couple of campaigns to defend their brand name because you do need to defend that because Gucci might want to take your ad spot, for that search term.
Joel: But you want to keep it at a lower a cost. They were at 30% a cost and we brought that down to a 50% target to those costs. Everything else we want to try to start getting them ranked and index for regular search terms because chances are, say they did a hundred thousand dollars in a month in ad sales, 50 of that probably they would've gotten organically anyway, because like I said, majority of their keywords, were their own brand search terms. So you really have to look at the numbers and the words and see what makes sense for your product. It's hard to give specific examples, but you are doing very well with your questions.
Liz: Oh thank you.
Joel: So hope we're getting some good information.
Liz: Well I think this is an area where a lot of sellers are in the dark and that's why they need people like you who really know what they're talking about to help them not spend too much money because I think what you said, people were just throwing money, come prime day, come Q4 you're just throwing money. And you're just seeing what sticks, if it sticks and a lot of times there's not strategy behind it. And there are a lot of people that are saying, okay, we'll help you with your advertising but then it's not really helping that much.
Liz: So there are people in the space that are not, and I know that you don't like to talk about your competitors and that's cool, but there are people in this space that are saying, I mean, I know some people that are great at advertising and I trust them and I trust them to take care of the people that I know, but I know that there are also people out there that are like, here just do this. And like you've been saying this whole time, there's not one size fits all for all sellers. It's really a nuance thing that you have to think about strategically. And you have to implement strategically for your particular store.
Joel: Yeah. I think the biggest complaint people have is being locked at the contract with agencies, good or bad they're locked into contracts. And it's unfair because this is their business. I don't have contracts. Yes, we lose big time. Just today we had a guy with a very large supplement, a brand. This guy is, let's just say Eastern European, he's from another country. And as you know, the FDA in the United States, extremely shrewd, extremely clever, but too clever. So every step there is conversations and conversations and conversations and it all makes sense. But at some point, like I said, it's not an exact math, so it doesn't help you to go full forensic. And because we don't have a contract, we had them for two months and it cost us a fortune of just implementing new processes, new processes, new processes, and now they're gone, but you know what? They're happy that we didn't lock them in and they trust us and they just figured they'll try something else. Chances are, they'll probably come back to us.
Joel: But we've had clients coming back three times already. And that's what I was saying. The number one complaint that people have and I feel like it's extremely this helpful, is when agencies lock you into a contract and then call you, wait another month, wait another month, wait another month without having a clear strategy. I think that it's pretty simple. Amazon ads is pretty simple. It's not like Google ads. It's not like any other method of advertising because you're in the store.
Joel: It's very clearly like product placement in a Target store. Like you're on aisle 41 but if you pay $400 a day, you'll be at isle 1 and eye level and you'll have one of those coupon clippers there. So knowing that it's a very simple process that the sellers should be able to understand and they should never be dragged on and on. Oh, their cost is going to come down, just give it like give it a month, another month, another month. And I think that happens a lot because agencies, I mean, there are businesses just collecting fees. Our business is satisfying our clients so then we can get more clients and more fees, but the fees are secondary. And by default we just do a good job.
Liz: That's one thing that struck me so much. So I learned about you on LinkedIn, I started following you on LinkedIn. I'm going to ask you about social media in a second. But when I went to your website, there's a phone number right on your website. That's so rare in this industry for there to just be a phone number where you can call and talk to somebody. It's right there on the top, like Hey, call Joel, it's right here.
Joel: It's my number.
Liz: I know.
Joel: It's my number there. And now we're changing that because, thank God we're... Our goal is, we're getting close to that is to manage 1% of all of old third party sellers. And we have a lot of top 100 sellers, definitely a nice handful of 100 sellers of top 100 sellers. And thank God we're getting very, very busy. I can't fuel every call obviously. Even though sales and marketing is at this point what I'm doing.
Joel: So we're changing that a little bit, but still, I just did a promotion on the Amazon group and I posted my cell phone number, text me, WhatsApp me. Look, somehow I've managed to do this with the same time of the day like everyone else. I think it's very important for when you're in the agency model and you're taking money from a client to do something on their behalf, it's very personal and you can't always keep it personal. 10 years from now I know even in three years from now, I know things are going to be very, very different even in the industry, certainly in my agency. But as long as you can for me I find that very, very important that I've helped contribute to our growth to this point.
Liz: That's awesome. So you said something that sparked my interest and it was a question I was going to ask you originally, and then I scrapped it. And so now I'm really going to ask it. So the landscape has obviously changed a ton for third party sellers over the last couple of years. I know that when I first got involved in the industry it was drastically different than it is now. There are a lot of rumors about vendor hybrid models and vendor central and seller central, and there's advertising available now. And there've been all these changes. What do you think is the next big change for third party Amazon sellers?
Liz: It's kind of a hot seat question. So if you...
Joel: Yeah it is, I feel a little hot right now. The next big change. For third party sellers I feel like, I mean maybe I'm just not creative enough. I just don't see how much more can change for them. Meaning if you have a brand that's selling on Amazon it's almost like you're getting capped out at some point. I'm not sure what else could evolve for them. I mean, the advertising is there. Amazon is trying to do outside advertising. Obviously it's a step down, it's not a step up. If you're advertising on Amazon that's great now you're going to go advertise on Facebook, on Google, it doesn't have the same effect. Beyond the advertising I really don't, they have seller fulfilled prime which is great, but Amazon at the same time is moving in and moving in and moving in, making inroads with their Amazon basics and all their other, their own private label brands.
Joel: That's not going to stop. I don't think that's going to stop. It's not rocket science to import kitchen widgets and Amazon can do it as good as anyone else. So I'm not really sure. I think that for big brands things are going to change a little bit, you're seeing all that stuff with vendors being cut out, being allowed back in, and then they want to get them back out of there.
Joel: I think next step for sellers will be other platforms that I'm certain about. I know Shopify is making big moves. I've been actually messaging Shopify executives for the last year. And saying when are you just pressing that button to connect all the Shopify websites and boom you have a platform that's bigger than Amazon like in five minutes. So I think they're going to press that button. So opportunities will arise in Omnichannel. I'm just not sure, again maybe I'm not farsighted enough, I'm not sure what's going to be changing at Amazon.
Liz: I think that's fair. So I did mention that... I'm sorry, go ahead.
Joel: I also think that sellers themselves have to, commerce keeps on growing. We're a consumer society, that's ending anytime soon. And as long as you innovate, you keep on innovating. I'm always shocked by sellers that are just stuck with our three products. Well there's 30 products. I mean, you literally could run a business with thousands and thousands of private label products and you have to constantly evolve. And the way to grow is not by just maxing out your three products, you want to grow by adding another three products. And I think that is probably the best tips that I can give Amazon sellers, I say it all the time, just grow your product line and innovate, just innovate. Easier said than done I know, but it's the truth.
Liz: So I mentioned that I first found you on LinkedIn. You did a video that just totally spoke to me. And I am responsible for social media for my company. And I just was at an event in Colorado where Jun Harda did a presentation about authentic social media and being yourself and being authentic. And I think that that's all great advice for social media strategy, but I'm wondering where that fits in for an Amazon seller beyond running ads and doing promotions on Facebook and leveraging Instagram for that. Do you think that social media and networking can impact an Amazon seller's bottom line?
Joel: Yeah. You know, it comes down to how innovative your products are and like how well you can market those products. And I'm not that innovative and sometimes you could, I've seen some great products that are just, the founders, the sellers, the brand owners whatever, they're out there every day promoting their products, making partnerships and getting visibility in media. It makes all the difference. I myself we have a business that we re-sell for most of the inventors.
Joel: So you have a couple that invented some kind of widget in their garage or someone's playing in his face with a product. He figured it out and he starts selling and he's at home depot and he's trying to get on Amazon. So we'll buy the product from them and become the exclusive sellers on Amazon. Some of these products you'll see them getting social media mentions, getting featured in a holiday article, in a magazine and the sales take off like crazy. And they are not necessarily genius products, major innovative products. So if you've got a brand that's a little bit out there, that's not 100% mainstream, if you can be out there and promote the product, I don't know about authenticity that's a whole other thing. But just in terms of getting visibility and promoting your product, of course it helps, definitely helps.
Liz: Great. Well, I think I've taken enough of your prime day, today's day two of prime day 2019. Joel Wolh from Boutique Seller, he's great at Amazon advertising. When he and I were talking about doing this video together, he said, " I can smile at you and I can engage you. And then I'll start talking to you about advertising and I'll bore you to tears." And you didn't bore me to tears today Joel. I really appreciate you taking the time today. And you guys look out in the comments for a link to boutiqueseller.com. You can go check out Joel's company and agency and Joel, we'll see you next time.
Joel: Awesome, thank you for having me. I'm looking forward to seeing you again.
Liz: You too. Thanks.
Joel: All right.
Originally published on July 18, 2019, updated July 1, 2020
This post is accurate as of the date of publication. Some features and information may have changed due to product updates or Amazon policy changes.