Prime and Beyond [Kenshoo]
August 17, 2020
Here’s a glimpse of what you’ll learn:
- Peter Phillips reveals the critical timelines for Prime Day, and how brands can stay prepared
- The best ways to get in touch and communicate with vendor managers
- Peter’s advice to brands concerned about advertising costs going up on Prime Day
- Peter discusses whether or not brands should discount their products in order to generate more leads
- The metrics brands should look at when deciding which products to promote in their marketing campaigns
- The value of Amazon’s Best Seller badges on Prime Day and how to get them for your products
- Where to get in touch with Kenshoo
In this episode…
Although Amazon Prime Day 2020 has not yet been announced, it is critical for brands to prepare in advance if they want to make the most out of the annual deal event. Most importantly, they need to start getting their inventory and budgeting in order to avoid missing out on the sales.
However, many sellers are concerned about an increase in Amazon advertising costs during this period, and therefore may choose not to get involved. Others may be reluctant to offer discounts on their products due to fears about loss in revenue. So what is the best way to prepare for Prime Day in order to maximize your profits without going over budget?
In this episode of Buy Box Experts, Eric Stopper is joined by Peter Phillips, the Sales Director of Ecommerce at Kenshoo, to talk about what brands on Amazon should be doing to prepare for this year’s Prime Day. Peter shares his advice on the metrics to consider when promoting products, the best ways to cultivate good relationships with vendor managers, and the benefits of Best Seller badges. Stay tuned.
Resources Mentioned in this episode
- Buy Box Experts
- Kenshoo’s partnership with Buy Box Experts
- Kenshoo Share of Voice Insights
- Request a Demo from Kenshoo
- Peter Phillips on LinkedIn
- Amazon Prime Day 2020
Sponsor for this episode…
Buy Box Experts applies decades of e-commerce experience to successfully manage their clients’ marketplace accounts. The Buy Box account managers specialize in combining an understanding of their clients’ business fundamentals and their in-depth expertise in the Amazon Marketplace.
The team works with marketplace technicians using a system of processes, proprietary software, and extensive channel experience to ensure your Amazon presence captures the opportunity in the marketplace–not only producing greater revenue and profits but also reducing or eliminating your business’ workload.
Buy Box Experts prides itself on being one of the few agencies with an SMB (small to medium-sized business) division and an Enterprise division. Buy Box does not commingle clients among divisions as each has unique needs and requirements for proper account management.
Learn more about Buy Box Experts at BuyBoxExperts.com.
Welcome to the Buy Box Experts podcast we bring to light the unique opportunities brands face in today’s ecommerce world.
Eric Stopper 0:18
Hey and welcome to the Buy Box Experts podcast. This is Eric Stopper. Today’s episode is brought to you by Buy Box Experts. Buy Box Experts takes ambitious brands and makes them unbeatable. We’ve got a team of consultants, I am one of them. And to be completely honest, everybody at least needs to bounce ideas off of someone else if you’re working remotely right now, and you’re not really super engaged with your marketing team and you just need some insight for Amazon. Seriously come and talk to us like this is what we’re doing all day. We’re keenly dialed into Amazon. And we have insight about all the different international platforms as well as us. And we’ve been doing a lot with Walmart recently. Thanks, actually, to our partners that can do this episode, I am pleased to bring Peter Phillips, Sales Director of Ecommerce at Kenshoo, onto the show to talk about Prime Day 2020. Peter, welcome to the show.
Peter Phillips 1:14
Thanks, sir. Good to be here.
Eric Stopper 1:17
So the first thing that I want to talk about is, is the kind of timing around all of this. Because a lot of the brands that come to me I think in like, Okay, we got to be ready for prime day. And they’ve been asking themselves that question since like last Prime Day. And so Prime Day in India has already happened. So we know it’s rolling out. But what are some of the critical timelines that you would suggest to brands and when is it too late for somebody to actually, like, be ready for prime day and have all the boxes checked?
Peter Phillips 1:57
Yeah, good question. And, you know, I think Everybody’s sort of been guessing this. And there’s obviously been a few leaks out of Amazon around different dates, and it’s been rescheduled and pushed back a couple times. But I think at this point, we’re pretty confident it’s going to be in the first week of October, likely the fifth or the sixth. So in terms of timing to prepare for Prime Day, I mean, it’s now i think that you know, we’ve been hearing you need to get your inventory in by, you know, the end of September. And in talking with you and some of our partners, we’ve heard that, you know, there’s already some delays in getting FBA shipments processed. So I think right now, if you’re a seller, you need to be pushing your inventory into FBA for Prime Day. And get ready not only for that, but you know, Prime Day looks like it’s just going to be an extension of the holiday shopping season at this point. So, you know, it’s not going to stop after Prime Day. That’s just the beginning. And then cyber five is going to be coming right on its heels. So get ready Now get your inventory in. Now if you’re a vendor, you know, bug your vendor manager to get those pieces cut. Because it’s got to get in there and get processed, especially when you think about the backlogs they’ve had from the pandemic and everything else that’s happening. Sure.
Eric Stopper 3:23
So it’s interesting that you bring up these relationships with vendor managers. I have found them to be fickle creatures, right? These are folks at Amazon. I’ve also done a little bit of research and I found that some of the vendor managers are like, they’re, they’re like, MBA students at Yale, and Harvard and Carnegie Mellon and they’re the churn is just crazy. I’m wondering from your experience, dealing with vendor managers, right, what is the best way to like, get in touch with them and to have that communication so that you don’t have Any of these weird breakdowns that cause issues like your, your customer experience and your customer journey and your inventory?
Peter Phillips 4:08
Yeah, it’s a tricky question. And I’ll say you know it Kenshoo where I’ve been for the last year and a half plus, I don’t have a whole lot of contact with the vendor managers, but previously in a different role. At another company, I did have some work that involves dealing with operations and vendor managers. And I think that the squeaky wheel gets the grease sometimes at Amazon, I mean, the hands off the wheel on initiative, if you’re not big enough, it’s going to be an uphill battle regardless, but if you have their contact information, I mean, get with them and having just a solid strong relationship overall is going to be helpful but at the same time to your point, you know, they’re in the job 12 to 18 months and then they either move on from Amazon or they move up in the ranks and you know, the the Soft skills set for that job is not something that is leveraged very much on the Amazon side, because they’re just looking at a spreadsheet that is calculating contribution margin from, you know, each individual Ace and each individual product that you sell them. So I think if you want to have a good relationship with them, one, you gotta have products that are profitable for them to sell. And that can be challenging sometimes, because they’re always asking for, you know, additional funding in their vendor terms across, you know, all the different aspects that go into that. And so, I think that in building that relationship, try to stay profitable. And then when you have a question or you have a need, see if you can align that with their incentives, which are going to be to sell more products profitably. And if you can do that, then I think you’ll get some help and get some attention and if you can’t, then You know, by and large, they’re just gonna put a line through that. That item on the spreadsheet. And, you know, you might not get a whole lot of help. But I don’t know if you’ve had different experiences and have other tactics.
Eric Stopper 6:15
I think I think the thing that I would point to as the biggest breakdown with vendor managers is that is the transition between them. Right? If we know that they’re going to be 12 to 18 months apart from each other, and that’s, that’s just kind of a general rule of thumb. I’ve seen vendor managers last like two months, right? They just quit Amazon because they realize like, screw this, like, this is awful. But being able to nail the communication between when the person likes tells you that they’re leaving, and establishing a good relationship so that they feel comfortable in telling you that even stating that, saying, hey, like I’m really excited to work with you right the first time that you meet your new vendor manager. Or you’re maybe you step into a new role and you meet the vendor manager just saying, like, Look, I know that you’re an ambitious person, you’re probably going to be out of this role. So when you leave, right, I would, I would love to just get an email introduction making a really smooth transition, because we can’t afford to, like, have any balls dropped. And I’m really I’m really putting a lot of trust in you. And the human side of these vendor managers I think is going to kick in. And that’s the other thing too, is to realize that these people just like the customer service team, that everybody despairs about human beings. And the more you treat them as equals, that have value, the more willing they’re going to be to try to rush your products on Friday, right? Like if you need to get a p o on the books and they think that you’re, you know, mean, they’re not going to be particularly willing to pick up the phone for you. So it’s just like a few little things there. At the end of the day, though. You’re at their mercy. And sometimes they’ll miss it. You know, and it could, it could be rough for you. But that’s that’s what I would add to that. So that actually gives me kind of a good transition. Because if their incentives are profitability, a lot of sellers and vendors that come to me are worried that if they, you know, use the Lightning Deals and the Prime Day deals, and they advertise really heavy, they’re worried about two things, number one, that their cost of acquisition is going to go way up, because everybody is dumping their money into Amazon advertising. And the second thing is that they’re discounting so much that they’re not, they’re not going to get any margin. They’re just not going to make any money on those sales. And so let’s talk about that. First, let’s let’s talk about the advertising thing. What would you say to sellers, what would you say to sellers who are a little reluctant to maybe get involved with Prime Day who are worried about their acquisition costs going up?
Peter Phillips 8:58
Yeah, I mean, I think that it’s a legitimate concern. And at the same time, it’s sort of a necessary investment. You know, Kenshoo, we support a number of different channels, Google on search, for example, Facebook, on social, and you know, Amazon for Ecomm, among others. And when we’re comparing those different channels, right, like Google ads, you can invest a bunch of money, and you can get the number one position for a given keyword and get a bunch of clicks. But that’s not necessarily going to impact your organic ranking, right? I mean, Google’s gonna determine your relevancy and surface your website when they deem it appropriate. And with Amazon, their AI algorithm is a little bit different, right? It’s really looking at your velocity, your sales velocity and taking into account your overall conversion rate inclusive of, you know, paid conversions, meaning, you know, if I ran an ad And then somebody clicked and purchased that product. So I think if you decide that it’s, you know, too great an investment or you’ve got to risk too much margin in order to be there on Prime Day, then what you risk losing is a lot of philosophy, not only because you pull back on advertising, but you’re pulling back on advertising one of the most important times of year on Amazon because there is going to be so much traffic. So, you know, I think that you can take a precise approach, and focus your ad spend on those products where maybe you have a little bit more margin. And then as well focus on keywords that are performing really well if you have keywords that aren’t performing as well in a given campaign, then you better get those out before Prime Day because you’re going to end up spending budget unnecessarily against them at a time when you’re discounting your product. More than you think. typically would. But overall, if you sit that out, then you lose the momentum that you would have gained during a time when there is a ton of traffic on Amazon and people are shopping and buying. So in my opinion, for most advertisers, for most brands, it makes sense to, you know, to invest in Prime Day, and then see the benefits coming out of that in additional sales after that promotional period is over. But, you know, if you have some products where you think, you know, it’s really not converting very well or it’s not very profitable, then, you know, maybe you pull those out of the campaigns and you focus on the products that are going to really, you know, give you the most revenue in advertising.
Eric Stopper 11:49
Let me let me throw a curveball at that idea. Because on paper, it seems like, like, you know, let’s say that I’m selling something like soda, right? Some water products are heavy, my FBA fees suck, right? It’s just the worst thing for me. And, you know, my vendor manager comes to me they’re like, yo, cool, we can get like a 20% discount and you’re like, Oh man, I don’t have 20% margin to even even mess with I almost feel like it would make more sense to just get one product in somebody’s house and let them be exposed to my brand. almost almost prioritizing non brand traffic, and just getting like one small unit that I just completely lose money on to establish you know, a little bit of of mindshare in my customers in my in my customers day, you know, like, Oh, I got this really like this five pack of little coffee inserts. And I want to reorder these, and the only way that I got it there was with this Prime Day deal that somebody was willing to take a chance on and I got it into their home and then they’re willing to repurchase That item. What do you think about that strategy?
Peter Phillips 13:03
Yeah, I mean, I think that it’s very viable for businesses that can take that risk. And I think it’s a very typical approach in CPG, right, most CPG companies, you’re going to have an array of products. And, you know, let’s continue with your example of, you know, maybe a soda or like, you know, coffee products or energy, energy juices or drinks right now are really popular. And what you see a lot of people doing is, you know, the consumer is used to buying that canned beverage, that canned energy drink. So you, you might sell that at a loss and get it into their home to get your brand in front of them, like you mentioned. And then you know, hopefully get them on maybe Subscribe and Save or something that with scale, you can be more profitable. Or alternatively, what we’re seeing a lot of people do is start to promote, you know, powders that you can then sell to that class. are sorry, customer, and they can, you know, order the powder and it will be cheaper for them. And it’s way cheaper for you to ship. And so then you can, you know, make it at home and you’ve got your energy drink and everybody wins. If you can sort of get them to then look at other products within your catalog, and I think that brand familiarity can definitely help achieve that goal.
Eric Stopper 14:27
That’s, I mean, that’s, I think for the brands who are selling these CPG products First of all, like checkbox number one is make sure you have subscribed and save set up if you’re going to run a deal on something. If you want a large lifetime value out of that transaction, you know, a $5 Click is worth it when that person is signed up to get your product at 10 bucks a pop for six months. You know, it makes a lot more sense. So continuing in the same vein, right? If I’m a brand owner, or even I’m just like, you know, running an account for a brand like a lot of the people who listen to this show, I’ve got to decide which of my products I’m going to focus on. So we’ve talked a little bit about margin, we’ve talked about, you know, if you can get a smaller version of your products in someone’s home, to get them into your brand. Those are a few considerations. But when you’re looking at your whole product array, what are some of the metrics that you would direct people’s eyes to? To consider prioritizing which products get the promotions and get the and get the juice of your marketing campaigns?
Peter Phillips 15:34
Yeah, I mean, I think I’m the way I would approach that is to focus on aces that are within striking distance of you know, being on the first page or being in the top 10 or even being in the top slot, the best seller for a subcategory. And in part, I would focus there because you know, rising tide lifts all ships right. So if you get one of your products into the top position or in the top 10 that’s going to help your whole catalog. And then with that, that individual product, you know, as we’re trying to figure out, you know, how should we invest? If you’re getting, you know, if you’re within that striking distance that we talked about, right, like I’m almost on page one, or, you know, I’m gonna get into the top 10 those types of moves are incredibly valuable. And I mean, we work on the tech side with a profit Taro on some mutual clients. I’m sure you’re familiar with them. And, you know, they have done a little bit of research around this and like, moving from page two to page one, we’ll see in you know, their analysis. So we saw like a 50% increase in sales. And if you can get into, you know, top 10 spot, we’re talking more like, you know, high 80s increase in sales. And then you know, we already talked a little bit previously about optimizing toward popular keywords versus, you know, less popular keywords in your advertising. And I think that by doing that by placing your priority on those basins that are already performing well, but you know, there’s marginal room for improvement. And that marginal room is really meaningful when we’re talking about, you know, page two to page one, or, you know, getting above the fold. So that’s where I would focus most of my energy and a significant amount of budget to start with, and then, you know, optimize the rest of the catalog. Until you know, you’ve basically used up all of your marginal opportunity on sponsored products.
Eric Stopper 17:44
Yeah, and I and I think this is, this is one of those perfect spots to plug Kenshoo because you’ve got like the Share of Voice tool that you’ll have, oh my gosh, how tremendous right to be able to tell how much of a given keyword you get exposure for and just being able To visualize all that data is huge for any brand that’s trying to move from page three or two to page one or from page one bottom to the top of the page. indispensable if you’ve never heard of that, by the way, if you’re listening, come check it out. Right? They’ll they’re happy to demo for you. And I’m happy to show you the tool. I think it’s a game changer in the industry. So on this note of like, moving from page two to page one, that begs the question of like, the Amazons Choice and the Best Seller badges. Can you talk to me a little bit about the value that these badges have during Prime Day and how to get them right? I feel like they’re Mario coins like a mushroom, you just like you can grow your sales huge if you just have this little thing. Talk to me about that.
Peter Phillips 18:51
Yeah, I think you’re absolutely right. So I mean, those Best Seller badges are always going to be valuable and even more. So during the Time like Prime Day. You know, I think, to start, you have to have good fundamentals with, you know, your content, your listing optimization, a lot of the types of work that you guys provide to our mutual clients, like getting that organic side really nailed down, which you guys do so well. So I think you have to start there. Like if that’s not all squared away, if you’re not, you know, retail ready, quote, unquote, as Amazon describes, with, you know, well formatted titles, and you don’t have at least you know, for product images and, you know, if you have any stock issues, prime eligibility, you know, a plus content, like, all of those things have to be squared away first. And then once you’ve done that, I think then you can move on to some of the advertising activities that are going to help boost your rank. So you know, tour they’re getting a call, we were talking about Amazon versus And sales velocity really matters for your organic rank on Amazon so we can impact that with advertising. And I would suggest using all of Amazon’s advertising products to get you there. And doing so in a strategic fashion. So, you know, sponsored products, sponsored brands, that’s King cheese, bread and butter, we’ve always been focused on search, and we support DSP reporting. And, you know, then you’ve got things like Deal of the Day or Lightning Deals. So I think, you know, if you want to grab that badge, during a specific time, such as Prime Day, you know, you’re gonna need to run Lightning Deals and Deal of the Day around that time running up to it, I would probably invest in DSP. And then you know, as it gets closer, I would really double down on search ads sponsored products, make sure you’re using top of bid search adjustment and focusing budget you know, in a way That is gonna drive the sales of this particular product. So I mean it and that really just means, you know, rinse, wash, repeat. So, you know, you’ve already done all of these things well, now you got to go back and make sure that your optimization is still up to snuff. And you got to use, you know, a tool like can choose brand insights dashboard for Share of Voice to see how the, of the popular keywords have been changing or as a new keyword trending and adjust bid, excuse me adjust bids appropriately for that. So, you know, I think you got to take a holistic approach and it’s got to have that, you know, good fundamentals standing from an operational and content health perspective. And then you layer on advertising. And once you get that, that sales velocity with the right conversion rate, then you know, you can get up to that Best Seller badge.
Eric Stopper 21:54
And there and the Best Seller badges are keyword specific. Is that right or are they just like general Normally you get it once you hit a certain threshold in sales.
Peter Phillips 22:04
So I think the way Amazon assigns them is based on relevancy and sales velocity. And you can impact those things with advertising.
Eric Stopper 22:16
I mean, all of this stuff, right? Like for the people who are listening, I want no world like this is so much to bite off. These things can be prioritized. And I think where I would where I would suggest everybody goes is reach out to Kenshoo reach out to Buy Box Experts come and talk to us. And we can help you plan for this, that you’re not too late. If you’re thinking that you’re going to be able to send an inventory in a few weeks, and be able to like, you know, be one of the ships that rises with the wave. You’re wrong. You got to get in there quick. Like you need to start making these plans soon. So come and talk to me and Peter and the other members of our team and we can definitely help you out and Peter do I just send everybody to Kenshoo.com? What’s the best way for them to get a hold of y’all?
Peter Phillips 23:07
Yeah, we’ve got, you know, request a demo form on Kenshoo.com if you want to take that route and there’s of course also our joint marketing page, which I believe is give me one moment here. It is a Kenshoo address. Do you know that off the top of your head I’m pulling it up?
Eric Stopper 23:31
I do. Yeah. So the page for Buy Box Experts and Kenshoo just sent it to me a second ago. That’s funny, but it’s lost in the mix.
Peter Phillips 23:43
I think it’s www.kenshoo.com/partner/buy-box-experts.
Eric Stopper 23:53
Perfect Yeah, we’ll throw it in the link for the notes on the show but www.kenshoo.com/partner/buy-box-experts. Check it out, go to buyboxexperts.com, click on the free and free listing analysis button, you’ll be connected with me or a member of my team, go and reach out to Peter, they have a requested demo section of their page. There’s a lot to this, and we’re steeped in Amazon and all these other platforms. And so we’d love to help you work on your, on your strategy for Prime Day in q4. I’ve got this cool tool that I have now that allows me to see how much of your advertising spend is being wasted on keywords that didn’t generate any sales in the time period that you’re looking at in your search term reports. And so one strategy that you might consider is taking some of the brand awareness right some people call that brand awareness, spend taking some of that spin and just doubling down on the keywords that are already working and developing a strategy on a keyword basis for the agents that have these discounts on them. Come and talk to me about it. I’d love to help you out. A Peter, thank you so much for coming on the show.
Peter Phillips 24:59
Yeah. Thanks for I’m here.
Eric Stopper 25:01
To finish today’s podcast I want to share some final thoughts for third-party sellers. To be successful on Amazon. You’ve got to get reviews. We at Buy Box Experts are really big fans of the team over at eComEngine. And it’s tools that help Amazon sellers simplify the process of soliciting reviews from customers who purchase their products. For more information, go to ecomengine.com. Thanks for joining us today.
Thanks for listening to the Buy Box Experts Podcast, be sure to click subscribe, check us out on the web, and we’ll see you next time.