Originally published on September 24, 2019, updated June 4, 2020
Watch the webinar above, or read the recap and transcript in the show notes.
It’s hard to believe but it’s already that time of year — that’s right, it’s Q4 again!
In this webinar, you’ll get access to valuable information about the immediate steps you can take to make this your best Q4 yet. Learn about key dates, strategies for managing inventory levels, and advertising strategies. Don’t have time to watch right now? Here are a few of the highlights!
Q4 officially began on October 1st. That means you should already have everything in place to ensure that your business makes the most of this busy quarter. You won’t see demand or interest at these levels again until Prime Day next summer, so you really need to seize the chance to boost brand visibility and sales.
With a spotlight on your business, any areas where you can improve will become glaringly obvious. So, if you’ve been meaning to clean up your product listings or get higher-quality images, don’t waste any time — do it right now. You only get one chance to make a great first impression, so don’t blow it at a time when it matters most!
As both a seller and as a customer, you’ve probably figured out that buyers really matter to Amazon. They are customer-obsessed, and they expect you to be too! As Fickenscher explained, “Feedback is a metric that you have to keep track of and answer for. Consistently low ratings can really hurt you.”
Fortunately, while FeedbackFive may be best known for helping sellers request feedback, it can also notify you if something is wrong. Setting up alerts about negative feedback allows you to address the problem right away, which sends a strong message to buyers and to Amazon. Once the issue is resolved, you may ask customers to modify or remove negative feedback (don’t try this with product reviews, though!) in order to protect your seller account.
People will be swarming Amazon throughout the holiday season, looking for the best deals on the right products. The last thing you want is for the competition to drown you out because you don’t have enough reviews. Customers look to see what others are saying about their experiences before making a purchase, so you have to make sure you are asking!
Over the past few years, the way sellers are allowed to request reviews has changed drastically, so it’s important to get familiar with Amazon’s most current guidelines. “There is no room for non-compliance,” Fickenscher warned. “Being suspended for asking for reviews in the wrong way is preventable.” Don’t take any chances!
Your Inventory Performance Index (IPI) is a metric that Amazon uses to determine whether you are eligible for unlimited storage (very desirable during Q4!). It may also help you identify ways in which you can improve your inventory performance as an Amazon seller.
When you fall below and get in trouble with your IPI, you can be subject to fees or hit with limited storage. Unfortunately, this can carry over into the next quarter! The lead up to Q4 is the perfect time to improve your inventory management strategy in order to avoid storage issues.
Teikametrics recommends a 3:1 audience-based campaign structure — one auto campaign and three manual campaigns. According to Magee, “This is what we see as best practices and results in the ability to scale.” For an excellent, in-depth example of what this looks like for Amazon sellers, please take the time to listen to the webinar. It’s worth it!
For now, remember that Q4 is your Super Bowl. When you spend money on advertising, traffic from consumers significantly increases. So, if you can uncap your budget, now is a great time to invest in advertising.
After reviewing the Prime Day data on 1,500 products sold by Teikametrics clients who increased ad spend by 33% on average, the Cost-Per-Click (CPC) actually went down, conversion rates stayed the same, but total revenue jumped by 540%!
In this jam-packed webinar, Liz and Jason also discuss a variety of other factors that you should take into consideration during Q4. They include the following:
Of course, it’s best to be prepared well in advance for this busy season, but even if you’re just jumping in now, you can put many of these Amazon strategies into action. Then, make note of your challenges and celebrations so that you can be ready next year!
Jason: Good morning, good afternoon folks, wherever you are. This is Jason Magee from Teikametrics. We are going to get started here in a few minutes. We're going to give folks a few minutes to start pouring in. As you all can see, Q4 is here. We're going to be talking with our guest, eComEngine, about actual strategies. Just hang tight for a couple minutes. One thing I will say, and I will repeat myself as well, but we want this to be very interactive, so use that chat feature. Matter of fact, I'd love to know where a lot of you all are from. So if you guys can, please start messaging in the chat. Tell us where you are, see what's happening, and make sure you can hear my audio okay as well. So please, as soon as you guys get a chance, go ahead and tell me where you're from. And Liz, you're with me, right?
Liz: I am.
Jason: Awesome. Liz, how you doing today?
Liz: I'm doing pretty good, Jason. How are you?
Jason: I'm doing well, thanks. I see some... We've called in the repeat offenders in the folks who are reaching out and actually attending here today. You said you recognized some of the names as well?
Liz: I do. It's always good to see the familiar names, and I love that the seller community as a whole is interested in education, interested in improving strategy. So it's a happy day for me.
Jason: So Sean reached out and said hey, Liz.
Jason: Then we have Cam from Indianapolis. I've actually never been to Indianapolis. I don't know what's going on there. I bet it's a good time.
Becky: It's a great place.
Jason: Is that Beck... Sorry. Everybody, we have Becky creeping in the back.
Becky: Oh sorry. I heard Indianapolis and I had to speak up.
Jason: Had to speak up. Go ahead, Liz.
Liz: Becky Trowbridge is our content manager at eComEngine and she works closely with me on outreach, seller education, and all that kind of stuff. So she's helping out today with questions, and all that jazz. I'm always happy to have her with me.
Jason: Awesome. Well, I'm pumped to have you guys. Ramesh from London, Ethan from Birmingham, Alabama. Fun fact. Per capita, Alabama has the most new sellers on Amazon in a given month than any other state. Did you guys know that at eComEngine?
Liz: No, we did not. That's fascinating. I was just in Salt Lake City, Utah... Sandy, Salt Lake City, Sandy area, and I know that Utah's got a lot of Amazon sellers, but did not know that the fresh blood was from Alabama. That's really cool.
Jason: It is. Somebody from up in Seattle saying hi. Good to have you on my friend. Denver, got a lot of Denver. Yeah. It's crazy. You would never think about it in Alabama, but Utah is blowing up. A lot of service providers, a lot of agencies, the works there. So cool. We'll give everybody about one more minute here, and then we'll kick off. Laura... Excuse me. Is it pronounced Laura? In Boston. That's where I am. I'm actually in Virginia, based in Virginia. Liz, you and I are what, an hour away?
Liz: Yeah, about. About an hour. Yeah. I'm in Richmond, Virginia.
Jason: And I'm in Charlottesville, but I'm actually at our headquarters in Boston today, so we're actually close to those who are in Boston here.
Liz: She could have watched you do this in person.
Jason: I know. It'd be a let down if you came and saw me in person.
Liz: It never is. Come on.
Jason: Jonathan waving from Ocean Park, Washington state. Well folks, what do you think? Should we go ahead and kick this bad boy off now?
Liz: Yeah. Let's do it.
Jason: Awesome. So just to reiterate, today is September 24th, got that right, showed up on time. That's awesome. Q4 is here. Actionable strategies to maximize revenue and seller health while you still have a chance. We talk about still having a chance a lot. We'll talk about the dates, but look, I mean things really ramp up towards the end of October and into November. Like we have a solid run rate of time for us to right the ship. We'll make sure everything's in order. Let's go ahead and introduce ourselves. I'm the gentleman on the left, you probably got that by the voice. Jason Magee, I'm the director of business development at Teikametrics. Liz, I've known you for years, just had the opportunity to meet you finally in person, what, at Midwest eComm? And Becky, you as well, a couple months ago, right?
Liz: Yeah. Right back in July.
Jason: Yeah. That is awesome. Yeah. I know we both were able to speak then. I think that's when we actually like sat down, like all right, let's go ahead and get some good content out together. So it's awesome. Well, Liz, do you want to give a little bit of background about yourself?
Liz: Sure. I'm industry liaison for eComEngine, which is sort of a business development outreach, sort of seller education, talk to all the people in the industry kind of role, that I love a whole, whole lot. I got started in this role in 2016, and I just pretty much spend all day learning about everything that I need to know in order to help our Amazon sellers be successful on the marketplace. So it's fun stuff.
Jason: That's how you and I got in contact. I used to run partnerships for WorldFirst, and my job was to go out there and connect with solution providers and grow all of our brands collectively and help sellers. And Liz, I think you have a very similar outlook, in terms of what you're trying to accomplish at eComEngine. Obviously, I'm at Teikametrics now, but it's funny, as big as the world of Amazon selling is, the smaller it is at the exact same time. Know what I mean?
Liz: It's so true.
Jason: Yeah. A couple of housekeeping things. Again, we are going to make this a live session. As you can see, this isn't recorded, this is live, at least for those listening on September 24th at 1:07. But if you guys have questions or feedback while we're talking, go ahead and chat away. Becky will help field them, we will as well. But let's go ahead and kick things off here.
Liz: But we are recording, right? So everybody's going to receive a recording of the webinar after it's over?
Jason: They'll get a recording of the webinar, they will also get the slides as well. Yeah. Absolutely. So here's a quick agenda of what we are going to cover. You're going to talk about feedback automation tips for seller health, why product reviews continue to matter, and why they're such a pain, and how to do it both wrong and right. Why Q4 is a great time to work on your IPI. I'm then going to talk about Prime Day data, and what that can tell us about Q4. What is an ideal campaign structure to win? How do we maximize ROI during Q4? What is hourly bidding, and why is it an absolute game changer? Teikaways. You guys get it, you see what we did there? You tell me I didn't like dad jokes, or I need to work on my dad jokes. That is one, right?
Liz: That, I mean, it's pretty close to a dad joke.
Jason: IPI. I told you we were going to get this question.
Liz: So IPI is your inventory performance index, and I should have spelled that out, but I was very, very stressed out about putting too many words on this slide. So I'm going to cover basically seller metrics that you have to pay attention to so that you can implement the strategies that Jason's going to talk about, and sort of how this all fits together.
Jason: You guys owe me swag to be delivered to my home now, after me getting that right. Here we go. All right. Let's start off with some noteworthy dates. So we all know, obviously, I broke it down with October, November, December. October 1st is the official start to Q4. Still to be determined, there is going to be a last day to apply for FBA access. What this means is Amazon actually has a cut off. If you have not shipped to FBA before, to apply to be a part of FBA, Amazon actually will cut off access to be able to apply to be a part of it. Also, to make certain holidays, areas, if you want to get your inventory there by Cyber Monday or Black Friday, there are actual dates you have to get your inventory to there by. I'll show you what it was last year. It's still TBD.
Jason: November. The 1st through the 21st is truly the kickoff to holiday season. 22nd to 28th is a countdown to Black Friday. Thanksgiving is on the 28th, and then the 29th is Black Friday. Cyber Monday, on the 2nd. It actually is in December this year. I think last year, it was what, at the end of October, right?
Jason: And then Becky, thank you for this, because you helped explain what 12 Days of Deals is. Becky, do you want to talk about this real quick?
Becky: Sure. So the 12 Days of Deals is just Amazon sends out promotions for 12 days to basically encourage people to buy things.
Jason: Yeah. That's not bad, is it? 15th through 23rd, last minute deals. 22nd, Hanukkah starts. 21st... This is rough, and then Christmas Day, and then let's not forget the 26th to 31st, which is when all the end of the year deals start as well. Going to the next slide here, what were the cut off dates last year? So this was shared with me, this actually came directly from Amazon. What you can see right here is here are the inventory cut offs of last year. So if you wanted to get your inventory there by Black Friday and Cyber Monday, you had to have it arrive at Amazon's fulfillment center by the 5th of November. Again, these are going to change this year, but I assume they're going to be pretty close.
Jason: If you want to inventory in time for Christmas shopping, you need to make sure that it's delivered... Last year it was by December 5th. So again, going to be similar to that. And then also, if you want to get your inventory ready for 2019, you had to send it no earlier than this date. That's again, what it was last year. It will change. Any feedback for you all to add here on this slide?
Liz: No. This is really great information.
Jason: Great. Thank you. All right. So let me kick this off here. What does it take to be a successful seller? Now, when I first joined Teikametrics I put this together. It actually could be a lot longer than this and a lot more cumbersome, but I just want to highlight that it's more than just one thing that it takes to be successful in this area. And then, even in high data scenarios, like Q4, when you have a lot of eyes and a lot of traffic, this is going to exponentially raise whatever situation you're in. If it's positive, it's going to be even more positive. As we shine lights on your business during Q4, if there are things you're not taking care of, like your order defect rates, or your IPI, or your advertising isn't good, than obviously, this is going to amplify that effect.
Jason: So one through six is sort of the chronological life cycle of a seller or a product. Access to capital. Do you have money for inventory and you keep your lights on? Product, listings, advertising, logistics, customer support. If you all are frantically writing down, don't worry, we're going to send this out. But I wanted to highlight that there's a lot that goes in to what it takes to be a successful seller.
Jason: Liz, you and I have both been on this voyage to actually find all the biggest and best brightest players in each one of these boxes as well. I also wanted to highlight what we are going to be covering today. So obviously, we use machine learning and world class data to automate and optimize advertising. We're going to be talking about advertising. Liz, if you just want to give a little bit of a shout out about eComEngine and what you guys cover just really quickly, for some context.
Liz: Sure. Absolutely. So we have three different software tools for Amazon sellers. One is FeedbackFive. Most people have heard of that, that's a reputation management tool. We've got ResellPro, which is an inventory management tool, and then we've got MarketScout, which is a product research tool. So a lot of our study and research has been about why feedback and reviews matter. How they impact your seller health, and then with the inventory performance index metric that was rolled out June before last, I think it was, how you manage your inventory and your supply chain and how that actually impacts your seller health too.
Liz: So we have a couple areas of focus, those are a couple of them. That's what we're going to be talking about today, are those seller metrics and how to use automation to stay on top of those so that you do have the opportunity to do the deeper dive stuff, optimizing listings, doing your advertising, really killing it in Q4. We also talk a lot about Amazon terms of service compliance in regards to product reviews, in regards to feedback, in regards to inventory. So that's sort of our area of expertise, but we're also very interested in general operations as they pertain to seller metrics. So that's sort of where I am today.
Jason: Awesome. Yeah. Absolutely. And folks, if you have questions that even beyond to the scope of what we talk about here today, email me, or Liz, or Becky and we can get you guys... Making sure that you guys are set up for success and have access to the right solution. So the flywheel is bigger than we think. Teikametrics, our solution is called flywheel, and I'll show you what that looks like. This is obviously on the back of the Amazon flywheel, but the way that we look at flywheel is if you start very, very focused on data science and understanding what's happening, and you use this to lower your costs of advertising, improving the performance of advertising, it's going to lead to increased sales. If you increase advertising sales, you're naturally going to generate more reviews, and a more positive sales rank if you have that sales or loss, in your positive relation with Amazon's algorithm.
Jason: Then if you're doing that, you're going to start ranking organically. Look, there's this really ridiculous causal relationship that makes Amazon and marketplace as very, very different than Google and other channels, which is ad spend and ad performance is directly tied to organic ranking. So if you are ranking better organically, you're getting more data, the flywheel spins. The thing is, is like this is just a small microcosm of what it means to be successful.
Jason: So sellers are matched with the right tools to help optimize, to help them grow, then you dump them into our flywheel, these tools being the sweetest solutions that eComEngine has, as an example. Sellers are in a better position to capitalize on increased traffic, and sellers gain momentum, and the flywheel spins faster. So this is the way, and I think this is the premise of what we are talking about here, Liz, is we obviously do what we do very well, you all do what you do as well as well, but you need to be doing all of these things right. You know what I mean?
Liz: Yes. Absolutely.
Jason: Yeah. So let's actually start off by running a poll. I love running polls here, so I'm going to go ahead and get one started for us. The question is how often do you check your ODR, your IPI, and other metrics?
Liz: So ODR is your order defect rate, and your IPI is your inventory performance index.
Jason: Yep. So I am launching this poll here. You all should start... Oh, I see everybody starting to give some answers here. This is some good feedback here. We'll go like another five or six seconds here. You seeing some of these results, guys? Interesting. All right. I'm going to go ahead and close this poll and then share the results. So you can see here, a pretty interesting break... What is your first reaction here, Liz, seeing this?
Liz: Well, it's a good thing that those 17 people are here to learn about those things, but I love seeing that people are checking on their metrics every day. This is about what I've experienced in the industry. This is about the split that I've seen, so I'm not shocked, but that's what I'm here for, is to help people understand what these metrics are and how to stay within them so that they keep a healthy seller account.
Jason: Don had an interesting one. He talked about ODR versus IPI. Should you be checking one more than the other? So ODR, you mentioned checking weekly, IPI is daily. What's your take on that?
Liz: I think that during different times, people pay more attention to their inventory performance index rating, because it does dictate your next quarter's storage allocation. In terms of ODR, if you haven't had a whole lot of negative feedbacks, if you haven't had a whole lot of A-to-Z claims, if you haven't had a whole lot of returns, then you can pretty much bank on your ODR being about the same as it was the last time you looked. So that makes sense.
Jason: And then Zoey mentioned if you are an FBA seller you won't see those metrics. Can you touch on that?
Liz: You do see those metrics as an FBA seller. Seller Central in your dashboard.
Jason: Exactly. So if you're not looking at it, and obviously these are all in Seller Central, then connect with us separately. We can talk to you all about how to do it. And I promise, Mara, we're going to go into ODR as well. So that being said, tip one. Liz, over to you.
Liz: All right. So we did have a question about ODR means what? That means your order defect rate, so feedback is part of that metric. So it's your seller feedback, your A-to-Z guarantee claims, and chargebacks. So that makes feedback pretty important for every seller, and Amazon says, this is a quote from Seller Central, "A seller who maintains a low percentage of negative feedback reflects our customer centric philosophy." So Amazon is customer obsessed, they expect you to be too. And while some of your feedback is obviously a little different if you're an FBA seller than if you're not, feedback is still a metric that you have to answer for and you have to keep track of.
Liz: If you get a negative feedback every now and then, it doesn't really hurt your seller account, but consistent low ratings can really, really hurt you, because that order defect rate is Amazon's overall metrics that rates your customer service standard. So again, it's your negative feedbacks, your A-to-Z guarantee claims, and your chargebacks. And there's a little formula on the next slide. So it's negative feedbacks plus A-to-Z guarantee claims plus...
Jason: Chargebacks. Yep.
Liz: Yeah. Plus chargebacks, and then divided by the total number of orders you've received during a particular time. So Amazon policy states that you have to maintain an ODR under 1% or you could lose your selling privileges. So that could escalate very quickly, right? All of a sudden you get a whole bunch of negative feedback, it impacts your ODR, your ODR gets over 1%, and boom, you could get suspended. And that would be a real bummer.
Jason: Within Q4, as well, like amplified. If you don't check this that often, what happens when you're having 10 X the amount of... Like 20 X, whatever it is, the amount of buyers coming to the platform, right? Like you don't even have to check it that much more often, and if you're too busy selling, selling, selling and you're not looking at your ODR and stuff like that, you can actually get cut off from selling in the midst of the busiest holiday season. We've all seen it happen. You know what I mean? So really, really important you stay on top of it.
Liz: So obviously, you want to pay attention to your A-to-Z guarantee claims, you want to pay attention to your chargebacks, but you can also get alerts. If we go over to the next slide, you can get alerts on your negative feedbacks so that you can address those problems right away. So obviously, FeedbackFive is a tool that lets you ask for feedback from your orders, but it also lets you get alerts on the negative feedback that you receive. And that's super important, maybe even more than asking for it, is important to keep track of it and know when you get a negative feedback and know that the faster that you respond to the buyer who has given you negative feedback, the better chance you have of A, creating a happy customer, because that's really the whole point of all this, but B, you can, at this point, per Amazon's terms of service, you can ask a buyer to modify or remove feedback after you've solved their problem.
Liz: You can't do that with product reviews. Heavens no, don't try that with product reviews, but you can do it with feedback. So if a buyer withdraws or modifies a negative feedback, your ODR will likely be adjusted within 48 hours. And so because there's that 48 window, you want to try to implement automation to receive alerts on negative feedback so that you can act really fast and that will protect your ODR in terms of negative feedback in your seller account.
Jason: Just a couple things you can add here. Just an example of that. I think we all like examples, if somebody orders something and let's say it gets lost in the mail or something. They go in there and they leave a really crappy review, like they have every right to because they never got their product. What happens if you find it's an FBA issue, or you solve it, and you go in there and they... I've seen it all the time. They're like hey, seller addressed my concerns, very happy with how they've done it, I've changed my rating. That's obviously good. But like look, if you don't know that it's happening and you're not checking it manually, or why not just automate this and be like hey, you had a negative, or you had a positive review. You want to know what's happening. The tools like FeedbackFive are a great way to do that.
Liz: Yes. Absolutely.
Jason: Awesome. Go ahead.
Liz: And when we get finished, Mara, I will tell you exactly where in Seller Central to find the order defect rate. But let's move on to product reviews real quick so that Jason has time to talk, I don't take up the whole time. Because I will, I will totally talk this whole time. So tip number two. 'Tis the season for product reviews. Absolutely, as traffic increases, then so do hopefully your product reviews. And product reviews are still like a really hot topic, and they have been since October 2016. I'd have to call that Review Gate, because that's when Amazon did away with incentivized reviews, and the landscape's really changed since then. Go ahead, Jason?
Jason: What happened then? Can you talk about what happened during Review Gate?
Liz: Right. So that was October 2016, and prior to Amazon's announcement that they were doing away with incentivized reviews, you could send a free or deeply, deeply, deeply discounted product to a person and say please write a product review on this, and all they would have to do is say I received this product in return for my honest review. And there were Facebook groups, there were companies built around getting those product reviews, by getting the products into people's hands and asking them to write reviews. It was, of course, grossly manipulated by some bad actors, and when Amazon saw that, they did away with that practice. So that was a big, big deal.
Jason: And then Heather had a good question. Can you explain how to avoid sending feedback requests to customers who sent us a message?
Liz: Particularly in FeedbackFive?
Jason: In general. I mean answer however you want, but yeah.
Liz: You can exclude orders with most tools, so if you've received a message and you have your timing set up in a way that you give yourself a little bit of wiggle room, if you get a message from somebody, then you can exclude that order. At least with our tool you can. And I think that probably Rachel in Customer Success has other tips on that too, so if you're a FeedbackFive user, and thank you for being a FeedbackFive user, absolutely schedule an optimization appointment with Rachel, or Eliza, or Franz, or Buen in Customer Success. I mean it's absolutely free to you, and we will dig into your account and help you get better results and better conversions and make sure that your emails are only going to the people that you want them to go to. Little plugs, shameless self-promotion is happening right now.
Liz: So we talked about product reviews. Product reviews are still a big deal. They're hard to get. When Amazon did away with incentivized product reviews, they did introduce the Early Reviewer Program. Like it's mixed reviews, as I say that word over and over again. I talk to a lot of sellers who think the Early Reviewer Program is awesome. I've talked to a few who say that they hate it and it didn't do them any good. But the majority of sellers I've talked to really like the Early... But that only guarantees like what, up to five reviews? And they say that the magic number for reviews, when things really start rolling for you, is 20. So you've got to get those reviews, and that's what asking for them does.
Liz: You've got to be TOS compliant. I have whole presentations and have spoken for hours and hours and hours about TOS compliance, terms of service compliance, why it's so important, and why it is just not worth it to get suspended over a review request. Review abuse is big on Amazon's radar right now, they've really been cracking down. People have been restricted for hours from sending any messages to buyers. It is a big, big deal. Eyes are on it, and there is no room for noncompliance. I can't stress that enough.
Jason: Yeah. Do it right. Obviously, a riveting topic of conversation is Amazon TOS. It's super important, though, all jokes aside. Like literally, I mean feel free to chime in if you have a horror story about getting suspended, especially something that... Not even knowing what you did or didn't do right.
Liz: Oh my gosh, all the time. Some people are just not paying attention in TOS, and Amazon doesn't accept the oh, I didn't know. Because all of the terms of service, while they're not all laid out in the same place and they're not extremely easy to find, they're there, and it's your job as a seller to know them.
Jason: Like what do they say, ignorance of the law is not an excuse? It's literally the same thing when it comes to TOS.
Liz: Absolutely. And the attention on reviews abuse right now is much, much more intense than it used to be, because there's still people gaming the system, there's still black hat tactics all over the place. There are review farms, there are... I mean, it's actually getting into the... I like to call it the mogul world, because if we're in the Amazon seller know, and then we've got the rest of the world out there that's not really clued in to third party Amazon sellers. And it's starting to get out there, right? There was that Buzzfeed news article. It's getting some attention in the press, that there's black hat stuff going on, and Amazon is totally... Sorry, go ahead.
Jason: No, think about it this way. Like you have the choice to be a good or bad actor, outside of all the obvious aspects of getting burned. Like you're going to get burned if you're a bad actor. If you're not a good actor, or you don't have your house in order, if you try and tell Amazon hey look, I'm brand registered, this person is doing this or that or whatever, Amazon's also going to take a look at your own account health. Like hey, is this a credible... I mean obviously this is more speculative, but they're going to look like okay, is this a good seller that has a good track record, or is there stuff that they haven't done well either? All that, I have to assume it's more of a black box, but all that pays it.
Jason: I remember with WorldFirst when we were... We helped sellers providing local bank accounts. Sometimes if they updated something like a bank account, it would trigger a review for their entire account. So the folks who actually did things right, and there was nothing bad to really discover when they go snooping around, that just puts you in a better position anyways.
Liz: Absolutely. Well, and like in the case of... I talk to Chris McCabe a lot because he deals with people who get suspended, and I like to know what's going on in that world, and he's just a really knowledgeable guy, and Leah McHugh, who works with him, is sort of the ACIN variation queen. She understands all the rules about ACIN variation. And if you've got an ACIN variation violation, they're going to look at all your As. I know that for sure.
Liz: But we're getting off topic, and it's almost your turn, but let's talk about inventory performance index real quick. And I actually just recently... Shawn and I did a webinar with Feedvisor on this topic, and you can find that on our webinars page on eComEngine.com, just go to resources and go to webinars and you can... Becky, if you could pop a link to that, that will go more in depth on this, and I'm just going to kind of review it for you guys now.
Liz: So your inventory performance index is a metric that Amazon uses to pretty much decide if you're eligible for unlimited storage, like very bottom line, very basic. It mines three months of historical sales, inventory levels, and crosses into a single metric, and then it helps you identify ways to improve your inventory performance as an FBA seller. So as of September of 2019, when I grabbed this graphic off of the Amazon site, a score of 500 or more is great. But if you remember, a couple months ago, a score of 550 was great. When they rolled this metric out at Boost in New Orleans of June of last year, they said that the number might change and it's all based on the available space in FBA warehouses. So this metric exists for you as a seller because obviously the things that are covered, it's excess inventory, it's your sell through rate, it's straighten inventory, and then it's your in stock, so making sure that you've got stuff in stock.
Liz: So all of that works in your favor in terms of your success on the marketplace, but Amazon also wants to make sure that you're not lagging in your inventory management because they don't want to be a storage facility, they want to be a fulfillment center. So they don't want you sending in inappropriate items for the season or anything like that. They want things moving at a clip, like quickly. And you do too, right? You do too.
Liz: So what happens if you fall below and you get in trouble with your IPI, is that you get hit with limited storage, and then that can carry over into the next quarter, too. So if you were hit with limited storage or fees this quarter, it's still like a really, really good time to start improving your inventory performance index with the storage you have now, working with that. And we've got some tips for that. So be sure to reach out to me if you want to talk inventory management strategy, because I love to talk about that, so it's just firstname.lastname@example.org.
Jason: And then real quick, on Chris McCabe, it's eCommerceChris is his company, and we're happy to give his contact info. Great guy, former Amazonian, really good service, and also a Bostonian.
Liz: Yes. And he does a seller event every month, faithfully. So if you're in the area, check that out and just go to meet up and take a look around for that, because those are really, really valuable events.
Jason: Reach out to us. Awesome. Well, anything else, Liz, on your side?
Liz: No. I think I went on and on. So I'm sorry, but I get really excited about this stuff.
Jason: That's why we bring folks like you on, is you have a whole different vantage point that we don't have. You know what I mean? Cool. So let's go ahead and run this second poll here. The poll question is what is your advertising strategy for Q4? Let me go ahead and launch this bad boy here. Launch poll. All right, folks, you should be able to see it here. Interesting. I love the engagement, too. You know what I mean? Just seeing everybody. All right. So I'm going to go ahead and close this. Let's share these results here.
Jason: So what we've seen here is yeah, actually a third of you aren't going to increase spend, and then probably just a slight majority... Actually, right at 50... Yeah, right at 55%. Slight majority are going to be increasing spend as well as uncapping budgets, and actually advertising less. As I go through this, my hope, my goal here, is to prove to you all that you should be increasing your spend. Matter of fact, you should be uncapping your budgets, and we're going to back it by data at the exact same time. So cool. Let me go ahead and close this poll here. Hide results. Let me go ahead and get back to... All right. You can see my screen again, right?
Jason: Awesome. So the internet makes it possible for any product from anywhere in the world to be on Amazon, but how do shoppers find your brand? Advertising. You can do everything else right, you can have a perfect IPI, a very good ODR, but still, it's not going to be enough. Matter of fact, I get this all the time. Nah, I'm good. I already dominate organic rankings, I don't need to advertise at all. Actually, it's not enough. So let me go ahead and give you a quick example of this.
Jason: So here's an example of us typing in slow cooker on Amazon. This is all above the fold, Ninja is sponsoring, doing headline search, sponsored brands right here. Crock-Pot is advertising these two products here. So right now, this is on a desktop version, it's just as bad, it actually can even be more daunting on mobile. So if you're not advertising at all, even if you're ranking organically, you're not being found. So that just proves that you actually really do need to advertise, because simply just having a positive organic presence there is surely not enough.
Jason: So with that being said, what is the optimal campaign structure that balances maximum control and maximum scalability? Well, I'm going to show you. So we recommend a three to one audience based campaign structure. What that means, you're going to have one auto campaign, and you're going to have three manual campaigns. Again, this obviously works extremely well with Teikametrics technology, but our goal is to get... Look, we do hundreds of millions of dollars Amazon ad spend is flowing through Teikametrics. We're going to give you things that transcend, whether you're using Teikametrics or not. So don't look at this as any sort of plug, there's plenty of time for a plug later. This is literally just what we see as best practices that balances, again, results with the ability to scale.
Jason: So an example here, we're going to use an example of Memory Foam Pillows. So you're going to have at least one auto campaign for Memory Foam Pillows, and then you're going to have three different manual campaigns. You're going to have one for all of your own branded terms, one campaign for all of your competitor terms, and then one for generic. So what this actually looks like is under the branded campaign, this is a defensive strategy. This is the example here of you actually advertising for Teikametrics foam pillow, if we were to sell one. Again, if you're not doing this, somebody else will do it.
Jason: Matter of fact, that's the third strategy, which is go after your competitor. Or second strategy here, this is like okay, Teikametrics is trying to compete with Tempur-Pedic. Let's go out there and run a campaign and target all of our competitors. This is a higher [inaudible 00:39:11] strategy, but it's very effective at... You're riding on the coattails of another's successful products, or even a weaker product's exposure, you can really start to gain market share. The other one is generic. This is Memory Foam Pillow, comfy Memory Foam Pillow, cool Memory Foam Pillow, whatever it is. So this allows you to really sort of segment your audience. It is more important to segment by audience type rather than match type, like broad phrase exact. You're creating more work for yourself.
Jason: So why does this matter? 78% of searches on Amazon are for generic terms. This means that everybody thinks that oh, the biggest brands win. Yeah, maybe if they're the ones dominating the search results on generic, but they're not necessarily going to their brands. And it's actually probably even higher, because a lot of folks find something under generic, and then they bookmark it. They're like I'm actually going to go and look for that specific one later. So I would say that probably a much higher percentage starts out as a generic as well.
Jason: The reason why this matters is generic, brand, competitor, all those terms are going to behave differently. You should expect a higher conversion with a lower rate cost on your own brand because they're coming to buy your brand. You should expect a lower conversion and a higher rate cost on the competitors, and then the generics should be similar in the middle. There's my source to the article as well, at the 78%. It's always good to cite a source.
Jason: Tip number five. Expect markedly higher volume, but do not expect material increases in cost per click and conversion rates. So let's look at... Liz, you and I were talking about this quite a bit yesterday. So what is the difference of supply and demand when it comes to Q4 on Amazon? Supply is consumers, aka traffic. This is a supply of traffic coming in a buyer's mode to purchase an item on Amazon. The demand is advertisers, sellers who are buying ads based on Amazon. Supply completely exceeds demand, meaning there are so many more eyes and buyers on your product compared to the increase in advertisers and advertising. Yes, more advertisers buy advertising, but the traffic from consumers significantly outpaces this. Sellers, this is your Super Bowl. This is why this is about Q4. We all know it.
Jason: Let's look at some actual data. Let's back this up with data. Why are we going to look at Prime Day data? Because Prime Day is a specific example, a microcosm of a high data scenario that is an incredible precursor to Q4. Amazon runs Prime Day, it generates a bunch of buzz, people are coming in and they're buying. It's very similar to what happens during Q4 around the holidays.
Jason: So Prime Day, what do we analyze? We actually analyze over 1500 products sold by our clients, and we compared the Monday and Tuesday of Prime Day with the previous four Mondays and Tuesdays, and every one of these products had to have at least one sale in those previous days. Let's actually see what the data told us. So blue was Prime Day, or teal, and then let's call it coral for non-Prime Day. You like those colors, right?
Liz: I do.
Jason: We can go with salmon if we want. Cost per click. Cost per click actually lowered during Prime Day for our sellers and our folks who are advertising. So it usually costs 56 cents per click. In aggregate, it was about 53 cents, so it actually lowered. Conversion rate stayed the exact same. This is important, because everybody talks about how it was so expensive to advertise during Q4 and it isn't worth it, but look, what really happens here is your... The only thing that is expensive is the fact that you only have a limited budget and you run out of how much budget you have. It's not more expensively, necessarily, per se, your cost per click's relatively the same, and so is the conversion rate.
Jason: So is the brand... Just to answer a couple questions. Hunter, you said is the brand referring to all brands that compete with you? It'll be a competitor's brand. So an example, as we mentioned too, if I'm Teikametrics and we're the company selling Memory Foam Pillows, we're going to bid on every keyword and isolate those keywords in our manual campaign associated with Teikametrics. And then the other side, if I want to go after Tempur-Pedic, Purple, Casper, those are all go under my competitors at the same time. Ethan, to answer your question, yes we are going to send this as a followup here as well.
Jason: The other thing, Hunter asked is about if you're not brand registered. Obviously, you can be going after any of these brands as well, but Amazon is trying to really cater to folks who owned IP in the brands as well, so it definitely behooves you to get brand registered if you can. But if you're still a reseller or anything like that, you could still be advertising as well. Liz or Becky, any questions that we missed other than that, or anything to add here?
Liz: No, I think you got them.
Jason: Awesome. So this goes to my next point. 8% of folks said that they will uncap their budgets. Let me show you why it's important to uncap if you can. So why should you increase budgets? Going back to our beautiful teal and coral here. The two day ad spend that we analyzed of our clients say they average a 33% increase in their ad spend, but revenue during that period, total revenue, grew 540%. Look at that ROI.
Jason: This is showing you that there's so much demand and traffic that is in a buying state, that even if you are spending more, you're going to have roughly a similar CPC, similar conversion rate, and you're going to have much more of a positive return on total revenue from that ad spend. This is black and white, the success that our sellers had here. Now, it's time to talk about tacos. For the folks on the West Coast, or the folks that eat late, obviously, hopefully this is getting you going a bit. Hopefully this is resonating with everybody else, but first off-
Liz: Oh, I'm so hungry.
Jason: Here's an image of a taco, or three tacos, I should say. So what is TACoS? TACoS is... We all now ACoS, right? ACoS is your advertising cost of advertising revenue, it's taking your ad spend and driving... It's then looking at what the return is compared to ad revenue. TACoS is ad spend into total revenue, which includes both ad revenue and organic revenue. TACoS captures the flywheel effect, because if you start with very good ad spend and ad performance, it's going to drive total revenue. And we all know the goal is not to drive ad revenue, it's to drive total revenue. More importantly, it's to drive profit.
Jason: Our data highlights how you should be viewing the impact of ad spend. And it's investing in ad spend to grow total revenue, not just ad revenue. I know we have some other questions too, so if there's anything you all wanted to call out or answer, let me know. Let's go ahead and just take some of these. So Jacob said for the three to one auto campaign structure, would auto campaign be competing against the manual campaigns in raising the cost up? No. The whole point of an auto campaign is an exploratory campaign. This is your telling Amazon, go out there and find keywords that are converting that I should know about.
Jason: Then you can move it from your auto campaign to your manual campaign, and you have the ability to negate it from your auto campaign as well. That way, you're not... So I'm just going to the next question here. Yeah, that way you're not competing against yourself in that keyword. Can you speak to best practices regarding resellers doing closeouts? In our help center, we actually have a recommended chart, about if you're doing a closeout, how you should be setting your max advertising cost of sale targets and increasing your advertising based on how many days it takes you to close out inventory.
Jason: These are some very good questions. I'm going to save some of these towards the end, and obviously, keep asking, because I'm going to try and address them as I can too, but I want to make sure we get through all this content. Of course, not all products deserve to be advertised. Which products should you focus on advertising? So products with very healthy margins, low TACoS while revenue grows. What that means is even if you're increasing ad spend by 33%, seeing total revenue grow at 540% means that you're going to lower your TACoS percentage, but you're growing your ad spend and growing revenue at a faster rate. That is an incredible thing to see happen.
Jason: Gateway products. Frequently bought [inaudible 00:48:32], or if you're going to sell the PlayStation but you're really going after selling the games as well, or products that are... You don't mind, they buy them frequently, right? Things that are reusable or they re-up their purposes, completely good to advertise, and when you need to clear inventory at the same time, as well as a newly launched SKU. Advertise the hell out of that thing.
Jason: Tip number seven. Leading into Black Friday and Cyber Monday, you do not necessarily need to provide discounts or promos to generate revenue. So going back to the Prime Day data, 60% of our clients did not lower their price. Matter of fact, 40% of them increased their price. So how did they actually fare with doing so? Well, first off, 94% of products studied grew revenue on Prime Day. 496%, roughly 5 X total revenue growth, for the folks who did not lower their price. Matter of fact, some of them even increased their price as well. So those folks are just capturing and really converting the [inaudible 00:49:48] that are on their product.
Jason: But what we're also not saying is, you may see me talking about this as well is, it does not mean you shouldn't advertise or discount, because there's a strategic reason you should do so. But this is truly jaw-dropping, where folks who just either increased their price or didn't change their price, almost a 500% increase in total revenue. That's incredible. Liz, I know when I told you this yesterday, it was crazy, right?
Jason: Yeah. Paul, I love it. You said FYI, always increase my pricing. I think absolutely, Black Friday, Cyber Monday. So couple things. John asked a good question about what do you do when an auto doesn't generate any keywords or impressions? A couple things. You should start to isolize... Isolate. I'm creating words over here. You should try and isolate what the issue is. First thing I would say is what is your budget? Increase your budget. That's the number one thing.
Jason: The other thing, too, is Amazon... This goes back into having your house in order beyond just advertising, is you have to have a very well optimized listing to maximize your ROI from advertising. Because Amazon goes into your listings, they go into your meta data, they go into your tags, they go into your keywords and the copy of your listing, and that's where they're pulling out keywords they think that you should be associated with. So that's the first thing, is Amazon's not getting good keywords because your listing isn't great. That's number one thing I would check.
Jason: Cool. Going on. Don't get us wrong, we clearly showed you discounts worked, because not only do the ones who did discount... Or did not discount, saw a 500% increase, the ones who did saw an 820% increase. So be strategic. Run promotions in [inaudible 00:51:28] and limited inventory you want to move. Old models, designs, or versions you're trying to clear out. While you're launching a new product, all good reasons to offer a discount. Gateway products again as well.
Jason: Then lastly, this is a shameless plug, but I think it's an incredible tip of the cap to what we're doing here at Teikametrics, and that is hourly bidding is critical. Before I get here, Steve had a question. What are your feelings on rewriting your listing every six months or so, as Google recommends in shopping ads? A few things here. This isn't Google, so just take a nose, even though it's similar in a lot of ways, do not just duplicate your strategy and what you do in these channels. Very first thing is I would ask what's happening with your traffic? What's happening with your impressions? What's happening with your conversion rates or click through rates? If they're good, if it ain't broke, certainly don't try and fix it.
Jason: This is also a good opportunity for you to test, A/B test a headline, or A/B test images, et cetera, and see whether the move is positive or negative. I would isolate, though, right? Don't change your bullets and your title, because if you see an increase or a drop, you don't know whether it was the bullets or title. Do one thing at a time, and go with that. Liz, you probably recommend the same thing when it comes to your emails or seller outreach post-purchase, right?
Liz: It all depends. That's kind of a loaded question, because that all depends. It depends on your category, it depends on the type of product you have.
Jason: It's not to have just one blanket strategy, you have to treat every category and look at the context of what works for a particular category, or a seller, or an audience, right?
Liz: Yeah. Well, and your timing has to be based on what makes sense for your buyer, too.
Jason: 100%. Cool. So going back to tip number eight. Why hourly bidding is critical. So what is hourly bidding? Teikametrics has the power to access campaign data on an hourly basis, such as impressions, clicks, sales every 60 minutes. We are able to synthesize and analyze this data every hour, and then proactively adjust bids based on this data. Doesn't mean we will, it means we will adjust a bid. If the data tells us we don't need to, we don't. In high data scenarios like Q4, this means that you can be more dynamic and adjust your bids before your competitors do. You have a limited time to be as lucrative as possible. We give you the ability to win more impressions and generate more sales.
Jason: So let's actually give you an example of what a new campaign looks like for people who are doing it manually, or maybe some other tools to do it daily or weekly. So let's say of a new campaign, day one, you're just trying to see what works. You may even use some of your organic data to set where your bid should be or what your conversion rates are. I can give you methodology of ways you should set it. If you're running a new campaign, you have already been selling that product, use your conversion rates, like calculate a bid that makes sense. We can help you with that.
Jason: But generally speaking, day one, you're just waiting to see what happens. Day zero. Then day one, I have one data set, great, let me throw a dart at the dart board. Okay, now I have two darts to throw because I have another day's worth of data. Okay, now I have three days, I have three days worth of data, now I can throw a third dart. Now, with hourly bidding, imagine being able to throw multiple darts in that day. Matter of fact, imagine being able to say I'm closer and more accurately closer to that bullseye. This is what hourly data can do for you.
Jason: Now, let's talk about lag and catching data. What I am not saying is that Amazon makes the data crystal clear. We all know there's a big attribution challenge, right? Amazon doesn't tell you right away whether that click from an advertising led to a sale. The delivery of their conversion data, it's not nearly as reliable as Prime. What do I mean by that? So hey, remember those 20 clicks you got with zero sales? Well, actually three, four days later, or whenever, there were actually two sales from that. So here's an example. Let's say that you have the bid on a keyword that's $10, so that it's a round number.
Jason: Amazon sends data at 10:00 AM, okay here's conversion data from Amazon. Nothing comes between 11:00, 12:00, 1:00, 2:00, 3:00. All of a sudden at 4:00 PM Amazon sends conversion data to you as well, and then they do again at 8:00. Well, what happens if when we get that data at around 4:00 PM, we realize that hey, that bid, $10 is way too high. So we get the conversion data at 11:00 AM, we're like you know what, $10 is actually spot on. We were right, predictive analytics with money. We don't have any data to tell us to adjust otherwise, keep it at $10. All of a sudden, we get data at 4:00 PM that says you know what, you should really lower it. You should lower it to $6.
Jason: What I'm saying here is like Amazon at some point has to tell you that that sale may have come from advertising, whereas it's a high data scenario, like Q4, this is going to be monumental for you to make a change if need be intraday. So we're telling you now have the ability to look back and actually take advantage of that as well. And then lastly, that rounds out most of the content for the day, but I wanted to just give you all a few key takeaways. Liz, do you want to take number one?
Liz: Yeah. Absolutely. So in order to keep this flywheel that Jason's talking about spinning, you need to stay on top of your seller health. So think about your inventory performance index, think about getting alerts for your negative feedbacks, think about getting alerts for your negative product reviews. I didn't mention before, but with those, you need to respond in line, actually on the listing, and that shows potential shoppers that you're responsive and that you're responsible. And we've got loads and loads of product review strategies on our website and in my brain, so just contact me and we can talk about that. And there was some questions about where to find your ODR and your IPI in Seller Central, so I can show you that if you contact me.
Jason: Awesome. 2019 Prime Day data shows us that it's an advertisers' market, so plan to increase budgets. If you guys aren't convinced by now, I don't know what to tell you, because we have a lot of data to back that up. But look, don't expect markedly high or higher CPCs, cost per clicks, or conversion rates, it's simply you're just going to get a lot more traffic. A rising tide raises all ships. Most products shall see an increase in revenue, but those who entice customers with promos can see larger traffic. Yeah. Do you want to talk about a special offer you're giving to our audience as well?
Liz: Sure. If you're not already a user of our tools, just use the coupon code TEIKA and you can get a 30 day free trial of FeedbackFive, RestockPro, or 150 free credits on MarketScout if you're a reseller and you want to do some product research. But I do recommend, as we get closer and closer to the beginning of Q4, that if you aren't using automation tools to help you run your business, really think about that. Obviously, don't buy stuff you don't need, but it's a lot easier to get started now, today, than it is to get started in about a week or so. So take advantage of our free trial, try it out, and see what you think. And if you have any questions, just let me know.
Jason: Awesome. Yeah. So we actually offer a free 30 day trial for individual brands and sellers who want to come and check out our platform. If you guys are an agency as well, feel free to reach out to me directly. My email is jmagee, M-A-G-E-E, @teikametrics.com. Jmagee@teikametrics.com. Liz, if you actually want to chat, I'll just go ahead and chat my... We should probably just chat our emails in here as well.
Liz: Yeah. Mine's easy, though. It's email@example.com.
Jason: So there's mine there as well. Folks, I wanted to say thank you all so much. We really appreciate it. I think rather than... I like this approach of not just waiting to the end to answer questions, let's try and answer them on the fly. Shawn did have one question about what is MarketScout? So Liz, do you want to talk about that?
Liz: I can give you a demo, and you know my number, but it used to be eComSpy.
Jason: Got it. I love it. Well folks, thank you all so much. We really appreciate it, and hopefully you guys have learned something. Yeah. Please reach out on LinkedIn, email, et cetera, and we really look forward to helping you guys have a successful Q4.
Liz: Thanks so much for having us today, Jason. This was great.
Jason: Awesome. Thanks guys. Take care.
Originally published on September 24, 2019, updated June 4, 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.