EP 66 - Backtalk Live - Steve Answers Live Questions from Awesomers
|Awesomers.com BACK TALK - We'll connect with the Awesomers Army of listeners to answer questions about starting and running an eCommerce business or related topics.|
Steve Answers Live Questions from Awesomers
Join us as we present another live question and answer session with entrepreneurs and Awesomers from around the world.
Today’s episode is a back talk episode where host Steve Simonson answers questions from a live audience. Here are some important discussions on today’s episode:
New E-commerce legislation, sales taxes, tariffs and what it means for your business
Handling positive and negative reviews on Amazon
DHL’s new cross-border COD service
Getting ready for Q4 - giveaway promotions, lightning deals and store management
So listen to today’s episode and learn more about our exciting discussion with Awesomers army of listeners.
01:21 (Steve introduces the back talk live episode.)
04:54 (Steve talks about the bribes and other dirty rotten scoundrels in China.)
20:03 (Steve talks about tariff.)
24:49 (Steve answers questions about sales taxes.)
27:26 (Steve talks about DHL.)
38:59 (Steve answers more questions about PPC and Amazon tools.)
41:58 (Steve talks about the indexing problem at Amazon.)
49:06 (Steve answers a question about patented products.)
52:35 (Steve answers questions about shipment inspection.)
57:57 (Audience question - does anyone use more than one vendor for the same product SKU?)
1:00:37 (Steve answers the last question and wraps up the episode.)
Welcome to the Awesomers.com podcast. If you love to learn and if you're motivated to expand your mind and heck if you desire to break through those traditional paradigms and find your own version of success, you are in the right place. Awesomers around the world are on a journey to improve their lives and the lives of those around them. We believe in paying it forward and we fundamentally try to live up to the great Zig Ziglar quote where he said, "You can have everything in your life you want if you help enough other people get what they want." It doesn't matter where you came from. It only matters where you're going. My name is Steve Simonson and I hope that you will join me on this Awesomer journey.
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01:21 (Steve introduces the back talk live episode.)
Steve: Awesomers.com podcast series episode Number 66. And today we are doing another back talk live episode, and this is where we join some members of the community live. If you want to find the community and go to Facebook and find the Awesomers.com Facebook Page there's also the Awesomers.com Professional or Amazon Professional Sellers Group which you can join. And this allows you to do a little bit of interaction and a little bit of socializing maybe some Q&A on a regular basis where the community can help you out and it's over 5,000? I don't remember, 5700 members of that? And that's been going a couple years even before the Awesomers podcast kicked off and part of the purpose was just to help people in a free way and give them an opportunity to ask questions and help each other as well. And I should tell you just as a matter of interest, that particular group has almost 2,000 banned people from the group. Because when somebody comes and they show up and they're just self-serving or they're mean or they're just like “hey I can get you blackhat reviews” or any other kind of skullduggery or tomfoolery we just ban them. Well we don't bother, we don't have time to say, “Hell no. Follow the rule. Did you read the rules? Please agree to the rules.” We just ban people if they can't behave in a professional way and so I want you to go there to that website if you're interested, and taking part in the community and just go to Facebook search for Awesomers.com Amazon Professional Sellers Group or any variation should help you find it. So again here in episode 66, it's a back talk live episode and we talked about some of the current events, some of the news items that are out there. We tend to touch on China so when you hear a little bit about China, we tend to talk a little bit about state sales tax and what the ramifications are for that, just as it has a news item basis, an interest, kind of ad hoc interest stories and other things that we think are interesting to E-commerce entrepreneurs and Amazon sellers in particular. Now all you have to do again is go to Awesomers.com/66 to find relevant show notes the details, and perhaps any of the links that we discussed throughout today's episode. Again, Awesomers.com podcast let me just move the mic a little closer. And we're going to talk today, this is episode number 66 by the way, so as you're listening live here to us, this is in the future. And yes I do have a time machine and so with episode 66, all you'll have to do once this goes live on the innerwebs or inner tubes, you just go Awesomers.com/66 to get the show notes details and even a transcript of all of the things we discussed today. Before we jump into questions, I have some questions that people have already submitted ahead of time, we're going to talk a little bit about some of the news items that I think are important. And they're interesting to me and I think they have the potential to be impactful to E-commerce businesses in general and Amazon centric businesses specifically. So we're going to talk through some of those things just briefly, and I welcome some of your feedback for the live guys here as well and gals. So first of all, Hello Facebook is over there, Hi Achilles and Zoom is over there and as always I don't know if we're upside down or right side up but, we'll have the zoom piece of the puzzle available later in the future.
04:54 (Steve talks about the bribes and other dirty rotten scoundrels in China.)
The first thing I think a lot of people have already noticed this article. In fact if you're not paying attention to this news article, the broken, the last, I would say the middle of September from The Wall Street Journal, basically doing an exposé on something that we have known and I think most people assumed was happening for a long time. And that is that there are bribes and other dirty rotten scoundrels constantly flowing around particularly in China. So Amazon has significant offices of footprint in China and some of the mid-level and presumably even high-level people have access to things like reviews, they have access to all kinds of different data points, like your competitor sales. So not only can they see reviews they could see customer information and the journal did a very nice job and Laura Stephens, she's quite good at this, and I think she's got a particular talent at kind of helping articulate what some of the weird things that are happening in the Amazon ecosystem. And so, these dirty rotten scoundrels are literally offering to take away a negative review for some set amount of money and it arranged from 80 to 200 dollars. If you couldn't get the reviewer, removed through the normal course of business, asking the customer trying to improve the experience and then trying to earn a better rating. Then, they would just pay somebody to get rid of it and that just goes to show the power of a negative review. And if you think about how those reviews are so extraordinarily impactful to your conversion rate, you can understand how this stuff kind of propagated through the system. China is very well known for greasing the wheels of justice in their view. In our case it's greasing the wheels of skullduggery and so it's not only them getting rid of a negative review, that's part of the allegations and things that we know for sure that are happening. But it's people over there selling your competitor sales data, like the actual sales data. They will sell you the customer contact information and we're talking about you know prices from two hundred to two thousand dollars. Amazon has said that they are in fact going ahead and they are investigating this as they should, and that's an appropriate response. But reality is they should be able to figure out this stuff is happening before it hits the press and for sure all you have to do Amazon, if you're listening, just go and check the WeChat accounts of all of your middle and upper management with access to this data, and when you see a bunch of WeChat transactions for money going in, that's a pretty good thing to investigate. There's almost no chance that somebody's going to start generating hundreds or thousands of US dollars per month just kind of on a whim, and the usual suspects of who are paying these brokers who helped organize the transactions if they have their cut but that's going to be a steady source of WeChat revenue. So when you see all those types of things, you definitely know what's coming. Charlie says check the velocity and dates and reviews of course. This is a whole additional problem at Amazon which is to say often, when we are launching new products and I don't know how they're doing it, I'll be honest with you. If we launch a new product, if we put in too many reviews, many of the product categories are now what I call review gated, there's a review governed. They're putting a limit and they're basically in our view, they're taking this average of your product category or your product type. They're saying the average product gets three reviews a day and so that's all we're going to allow you to have to. So that doesn't do much for us because, that means we're always kind of in a review hold or a review pattern and it'll take us a long time to recruit reviews. Whereas new Chinese companies can absolutely end up having hundreds of reviews within a period of day. And again that seems so easy to find so anyway the Wall Street Journal article I found to be very interesting talking about bribes, skulduggery and tomfoolery happening. As we all probably suspected it was, but I think the Wall Street Journal did a very good job of highlighting that. By the way, there are a number of these blackhat services operating in China it surely points out, and they're not good for any of us long term obviously. So I want you guys also to pay attention to Instagram and Facebook at large honestly. Instagram rolled out shopping into their stories and I'm not a cool hip millennial so I don't understand why people post stories and all that. But I do know this, if we can put native shopping ads in stories, or in any other Instagram formatted piece of content, we're going to have a higher potential chance of making an E-commerce transaction. “Hi Brandon it's good to see you too.” And so the point is the Instagram in fact has absolute intentions to become a shopping platform as does Facebook for that matter, as does Google but I just don't want people who are particularly centric to Amazon getting so focused on Amazon that they forget that these other platforms are coming, and they have the potential to be meaningful. Now again I know everybody's like “80 20 rule, you can all do what you could do.” And that's fine. I'm saying pay attention, you decide when it makes sense for you. But even though Amazon is the absolute dominating king of the hill today that's not how it necessarily will always be. There are many cases of the prior 800-pound gorilla being dethroned and in the past I've given you examples of the cell phone guys, very few people remember Palm Pilot, unless you're old like me and Michael, sorry Michael I threw you under the bus with me. But from Palm Pilot yet nobody expected that to go away, and then Blackberry showed up and nobody could touch Blackberry, and then of course Apple showed up, and now Androids here, and who knows what's next. So the point again is, there is always change, you should be on the lookout for change.
I do want to point out, let's talk a little bit about sales taxes, I know that's everybody's favorite topic. So first of all, despite the fact that the Supreme Court made a decision in June, related to the prior Quill versus North Dakota. They didn't change any existing law at that moment, other than changing the precedent and then they remanded that back to the lower courts in South Dakota. And South Dakota more or less is sitting on that, and deciding how they want to put legislation in place. Now they have the permission to put in the legislation, they're trying to decide how to deploy that. So that in South Dakota that is not actually law yet, just for those keeping score at home. The good news is, there is mumbling of legislation in the works, and I'll talk about that here in just a minute. In a recent, I don't even know how to describe this change but an unexpected and idiotic change, Washington state has decided to adopt the South Dakota methodology. And what does this mean to you? So once a state at some point earlier in the year put into place the marketplace requirement that Amazon or Shopify or who ever is running the platform of the marketplace, they collect the tax. That sounds pretty good. That's only part of the problem, that doesn't take you out of the business and occupation taxes and other things and Washington by saying, that we're going to adopt the South Dakota law which essentially says, you only have 200 transactions in the state of Washington, or you have 100,000 in sales. Whichever comes first, then you have Nexus with Washington, so-called economic Nexus. So Washington is going to put this into place, in spite of the fact they already have this marketplace law. So many of us saw this marketplace law, as a potential reprieve and a potential simplification, but no state governments in my humble opinion, are a magical mix of incompetence with foolhardy concepts and anything negative, just throw in that word, that's how state governments operate. And yes state governments if you're listening, I think you're stupid. Okay so the good news on the federal level, there is some legislation being discussed, pardon me, a bipartisan effort two Republicans, two Democrats, have put into place a general piece of legislation that is not nearly going to go through yet, but at least there's a glimmer of hope. And what this legislation says, is number one, you can't go back and attack these E-commerce guys and these small business E-commerce cross-border guys. So that's an important piece of legislation for us to pay attention to, because all that retroactive action that the states are going to try to get out of yet is unfair and in my view unlawful. The second out, Shirley said I started out diplomatic. Believe me Shirley I am still despite those stronger language. I'm still quite diplomatic, if I really said what was on my mind, we would have to start bleeping and blooping the whole operation over here.
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Start to say no back taxes and also under ten million dollars of sales you don't have to comply with these interstate commerce nonsense laws. And that's really what we need to see happen is something on the federal level that says, some reasonable threshold. I really do think above ten million you probably have the wherewithal to start putting some of the tax compliance management into place. But you know it's not just as simple as collecting and remitting taxes, as I have talked about many times. There's local taxes, inventory tax, B&O tax, all kinds of crazy taxes. Not to mention just the fees in California, just the registration fee every year is eight hundred dollars, and so it's like a hundred bucks you know what's the difference. But just imagine states starting to see. You know what let's just charge these out-of-state E-commerce guys who have no votes in our state, they have no ability to help impact legislation. Let's just start charging them a two hundred, or five hundred, or thousand dollar a year registration fee and then multiply that times forty five states and you've got a big potential problem. And even that is still a smaller part of the problem, ultimately the problem is compliance and managing the paperwork. I'll give you just a quick story, we have one of our companies that is an employment company, we have employees in a number of states, and we submitted a piece of paperwork to the state of Idaho. Now Idaho is just absolutely just sending us all kinds of registration paperwork. And all kinds of crazy stupid pieces of paper, that are not even accurate. They thought we started employing people two weeks earlier than we did, so they are just haranguing us, and burying us, with demands of paperwork. Even though they just simply made a mistake that is equivalent to weeks and we've spent dozens of hours trying to solve it. That's the problem I'm trying to get everybody look out for. So one final word I want you guys to go over and take a look at Online Merchants Guild, Paul Rafelson and if you're not in the loop go listen to Awesomers.com/3 for a very in-depth discussion about sales tax, a very in-depth discussion about the legality, and some of the things that we can do as sellers to help fight back. And the Online Merchants Guild is working today, right now, on filing a federal injunction to put a stop to some of this stuff, which is just the first start before we try to help fund a lawsuit against the state. We'll need somebody in California, may be more than one somebody to be the proxy for that lawsuit. But we want to sue the state and we want to help fund the lawsuit to basically prove, that sure Wayfair which was part of that Supreme Court case in June they've got the wherewithal, a billion dollar plus company, they can do it. But we're little guys and gals we don't have the wherewithal, we don't have the time, the energy, the experience, or the resources to cope with this, just absolutely outrageous regulatory and compliance nonsense. They're really again, it's not relevant to us. I don't care what South Dakota says, it doesn't matter how many sales or how many packages I send the South Dakota, I'm still not using their infrastructure. When I told them that they're like “Oh no! You're using the roads to ship the package.” And I said well first of all, UPS is using the roads not me and they pay local taxes. Secondly, gas is what funds roads, so get out of my face about sales tax. Anyway, I have no love loss for this whole thing, and it hasn't got more clear, it's gotten less clear. So if you're faced with this challenge, make sure you get really good legal support, and if you're being beaten down, I would highly recommend talking to Paul Rafelson Law, he can help you. So that's enough on sales taxes.
20:03 (Steve talks about tariff.)
So let's now talk about somebody else's favorite subject, that's China tariffs. So just in the past seven days from the time we record this, in the middle of September, I think it was actually September 16, 2018. The next section of tariffs on two hundred billion dollars worth of imports into the United States, have been getting a plus ten percent tariff, effective September 24th. So that's an additional 10%. So somebody said to me the other day, like “Hey, mine was already 8%, so 10%, so that's an extra two points? And I was like “No, no. You are already 8 plus 10, now you're 18.” So just understand that's how the math actually works. It is not 10 total or maybe you were 20 before and it didn't go down to 10, it's plus 10 to whatever your base tariff may have been already pre-existing. And that goes into effect for anything that clears customs as of September 24th. I have to tell you, some of the stuff that we have going, my team is watching somewhere I don't even know the exact container count, but somewhere between 60 and 80 containers that are floating around, or have just shipped and we're hoping that they clear customs as many as possible before the 24th. So, it's not based on the ship date, it's not based on the arrival date, it's based on the date that the issue is submitted for customs clearance. So if you don't already know that, that's how you calculate your exposure. Now one little fun footnote is that on January 1st, this same set of tariffs will go up to 25%. So plus 25%, so if you're at 5% today you're going to go plus ten immediately, which means you're 15. But on January 1st, if you're five today you'll go to plus 25. That means you'll be at 30%. Now again, this is all just part of the negotiation and kind of this, I don't actually think it's a trade war. I think it's just a trade negotiation and dispute. It's a pain, it's a headache, but that's life and we just have to kind of move on. So number one, understand your dates and by the way, this 200 billion covers about 40% of what is imported in the US, and I suspect if China retaliates on these tariffs as they have said that they would, then we will just, the US will then just slap a tariff on the rest of the Chinese imports. And it surely is right, this is a little bit of a pissing contest. The reality is China can issue, more matching us for tariffs, but we import like five times more than they do from the US. So it's a losing game. China's also said that they will slow down the exports, they'll put more pollution controls on the factories that are exported to the US. And they might even put some slower exporting, and of course the factories we talked to in China, they're terrified about that and that would hurt Chinese company. I think it's a lot of bluster. I don't think this is going to last years. I know everybody if you read the press, they're talking every single day about this is buckle down for the long run, this is going to take forever and I think that just sells more newspapers and it sells more... nerds. So all of these things, they sell more newspapers, they sell more things, and for those who are waiting in the Zoom room my apologies on keeping you hung out there, in fact my view is slightly blocked. I blame Facebook. So hopefully these angles aren't too weird. Fundamentally everybody, my point is when you think about China, when you think about this ongoing trade dispute, know that I think it's going to take months, not years to resolve. And a lot of the press guys are going to try to make more out of this, and of course China's got to find a way to stay faced while they're doing this. But just know this, it's a pain, it's going to get worse before it gets better. Right there, the old saying is that, it's always darkest before the dawn, and I want to just remind everybody that's kind of the way things work in the real world. So, if you have questions by the way, if you're on Zoom, its easiest for me to see the chat questions so put those in. If you're on Facebook, then go ahead and you could try to put in there and i'll try to keep a flow of consciousness on those.
24:49 (Steve answers questions about sales taxes.)
So I do have some pre-submitted questions already and I see some stuff in here. Troy, thank you for those comments. Now, oh so Troy's talking about getting beat down by Arizona every week. It looks like it’s related to sales tax, is that right Troy? Yes. So you know here's what I would say “Hi Steven, up in Canada” I would say if you're getting beaten down by a state, now this is not legal advice so everybody can just ignore this. But here's what I do, if I get these things. I ignore them, because all they're trying to do is entrap you, they're just trying to get you to stand again for everybody who's just joining. We're talking about sales tax enforcement letters California, Washington, New York, Arizona, whoever they're sending you letters. And really this is just them trying to get a funnel, and the top of the funnel is get somebody to respond. If it's a significant amount of money or the pressure is significant, then retain the sales tax counsel. And again if you go to Awesomers.com/3, you can listen to a very lengthy but instructive discussion about it. Troy points out he's already in fact paying taxes, this is one of those side effects. But now, every city, every county potentially in Arizona they're going to want him to have a little business license and I've used this example of Tempe Arizona in the past and I'm going to jump back into sales tax just for a minute. So Tempe sends a friend of mine, she gets a little love note that says, “Hey, we see that you're registered in the state of Arizona collecting taxes and great news. You had a sale in Tempe so send us $50 registration.” And she calls him and says “Hey, I got your letter but I only sold a fifteen dollar silicone spatula.” Let's say, and they're like “Yes, cool cool story bro but we still want our fifty bucks.” And that's the point about all of this stuff that the legislators are just simply ignorant, or incompetent, or uncaring, about legislators, you can pick your own descriptor there. But they don't know what's up and it's not going to be good for us either way. Okay, so I'm going to move this over here so I could see this, so forgive me as I move around, I got a few screens going. Alright so, if you didn't have... Brandon got... I see. Yes, thank you. I tried to throw in a little humor for you Brandon. If you haven't caught the top of the show, make sure you do when this comes out Awesomers.com/66. That you're able to go take a look it, probably won't be released till early October or, yes I don't really know the date, too many things to look up.
27:26 (Steve talks about DHL.)
Alright so let's take a break on tariffs, let's take a break on sales tax, and let's talk about a fun little thing, which is that DHL is starting a cross-border COD service. So what does this mean, now if you ship International today, and I don't know how many of you guys do this directly, but just know that could be in your future. DHL is a very prominent international carrier. So if you don't cross-border trade, this is a very common thing, but a lot of people don't realize many countries particularly in Asia, and the Middle East, and probably Africa and South America for that matter, they operate on a cash-on-delivery basis, a COD basis. So for anybody in America, in the 80s and 90s and perhaps, even today, you heard the infomercial type commercials that would be on and they'd be like call 1-800 whatever, and they would even accept COD shipments. Today in America, there's no chance that anybody operates on COD. It's like you either have a credit card, you make your purchase, we get the money, and we're done. That's how it works in most developed countries - US, Australia, UK, all across Europe really Canada as well, very few people are using COD. But in fact in China, including today and especially in the recent years, if you ordered a refrigerator, they literally would wait to see the refrigerator show up and then do a cash-on-delivery kind of transaction. And that's one of the reasons why Amazon has struggled in China. That's not how they do business, they didn't really understand that. So now DHL is saying we see E-commerce is being very very important, and so we want to you know put a lot of emphasis on E-commerce. And so one thing that we can do to add value is, add a COD service for cross-border, which is that's crazy. Now, one of the things it does and this is probably for the better long-term, but you know a lot of people who are shipping out of the country now, whichever direction from China to the Europe or EU, from China to the US or even the U.S. outwards, a lot of people go. Well, I'm just going to put a valuation that is under the customs minimum, and that way I don't have to do as much paperwork, which by the way is illegal I wouldn't recommend it. By using the COD service you will be stating the actual value that you intend to collect, therefore all the appropriate duties and taxes and so forth will be collected. That's a big deal and I think people should pay attention to it. As you start thinking about crowdfunding or Instagram or all these things, there's going to be a lot more cross-border trade, and if we have an easy way to execute on it, like using a DHL service like this I think there's potential for it. So anyway keep your eyes on that. I see Lisa asked a question, and she asked, okay I'll come back to that question Lisa. I think it's a very very good question and we'll talk a little bit more about that in detail once we get into one of the next sections. If anybody is on Zoom go ahead they can throw in the question in chat and if you try it on Facebook, I'll try to see it as it goes by. Okay, so one of the other things I said that we want to talk about is quarter four, right? Where Q4 is upon us. This is the peak time, the busiest time and it's where 60% of sales happen on Amazon. And so if you are trying to think about Q4, one of the things I want you to pay close attention to if you have this opportunity, is the schedule for Lightning Deals, Black Friday and Cyber Monday, best deals if you have access to that. And it's really important if you want to submit promotions that you need to do them now. So go to your promotions homepage, you can do this in Vendor Central or Seller Central, depending on the type of seller you are. And I think let me see if I can find… the deadlines here, yes. Your deal has to be approved by September 21st to get into one of those Black Fridays or Cyber Mondays. So if you... Hi Muhammad, nice to see you. If you in fact have not submitted or are waiting to submit, you are literally down to the last couple days. So September 21, that's a hot-button issue, please get on it. If you don't have access to that, try to find somebody who can get you access within seller support or whatever. But if you've ever done a submission in the past, you can use that email as a way to submit. Doesn't mean they'll guarantee that they'll take it but that's one method. Troy points out something important, let's talk about it. Says he hasn't run a best deal a long time because the last time he did, the best deals force down the lightning deal price. He wants to know if that's still the case. So I think that's a fair question and something that all of us should be cognizant of. Every time we do a promotion that is sticky in some way, whether it's lightning deals or best deals, it definitely is a problem when it comes to establishing that new “low price”. And it's supposed to be a 90 day trailing window but sometimes I think they look back farther. We have talked specifically to the promotions Department Troy about this idea that their own promotions shouldn't force each other down. That it is not a fair thing to say, here's the best deal promotion and then that is the new point that you have to discount 15 or 20 percent for a lightning deal. I don't know if they fixed it yet or not but if you put it in and it's rejected, I would appeal and try to get to somebody in the promotions Department and illustrate that point. The other thing that we complained about voraciously and this is when we were physically this is when the Catalyst88 group was at Amazon event. We said hijackers are also forcing down the price and we asked them to disconnect the Aysen price from the seller price. If you have a hijacker, if you're selling for $25, a hijacker jumps on for 10 bucks. Now they're like well now you got to sell it for 15 or 20% below the $10 switch, idiotic and ridiculous. So that's how I view the situation, I don't have a perfectly clear answer Troy but I would say if you run the best deal and that you find that is forcing down your price, then you should do kind of manual appeals and push them to get it fixed. They recognize the inconsistency and they have empathy for us as well. So last word on Q4 before I start diving into some Q&A, and don't worry Lisa I will come back to your question. Okay so first of all I see Shirley you have a question in here too. And because Facebook is rolling these things by, I'm going to tackle Shirley's first and then come over to Lisa's and some of the other ones that I have already presubmitted.
So Shirley asked this question, “Can you talk about the Amazon giveaway promotion? How does it work exactly?” Pardon me. So an Amazon giveaway is you go down on the ASIN page on the product detail page, and you can find something that says giveaway or an Amazon giveaway whatever it says. You click on that and then you can decide how many units you want to give away and you can decide the type of giveaway. Whether you're going to just give it away to the first three people or a random number or a sweepstakes basis. And actually there are very subtle ways of setting that up to get kind of the best exposure. And for the lowest giveaways or if you are going to give the way to make sure that you get a high amount of awareness-building, right? So the way giveaways works is you're driving some behavior go watch this YouTube video. And over time I'm sure they're going to get rid of external things but go tweet this tweet or follow this Twitter account, do this YouTube thing. It's you can require this action to decide if Amazon is going to enter them in the giveaway. That's a requirement to get into the giveaway. It can be effective in certain ways because let's just say you decide you're going to give away 30 units Amazon charges, whoever's doing the giveaway for those 30 units immediately does a giveaway and refunds. If they didn't give them all away or ships amount, if they did give them all away a couple downsides. You don't necessarily get to, you don't get to control if that giveaway is successful or not. You don't get to know who the customers are, who got the stuff there. There's some downsides to it but ultimately I think that the BSR bump, the awareness bump and then ideally you're driving some tangible action with the action steps they allow. Not Facebook views but YouTube views and I'm sure it's going to go to Amazon video views. So you can show like an Amazon video review of your product or unboxing your product and they have to watch that. It used to be for two minutes, I can't remember if they've updated it now but they have to watch these things so you get to make a concrete brand impression if you do it right. A pro tip by the way, if you're running these things and you're working with influencers you can coordinate a giveaway with very few units given away if you do it right. And you can tell the influencer, “Hey I will make sure that you get at least 3000 views on this video.” And they're all legit views because they're coming from Amazon and influencers think you're a hero. So sometimes you can trade that and go hey, “You do an open box for me for free and I'll make sure it gets at least three thousand views and they’ll be legitimate reviews.” So it's a thing and it can work very well especially for emerging influencers. People are trying to make a name for themselves.
So forgive my hand here as I scroll. Becky asked, “What department do you need to deal with hijackers driving down your price?” So ultimately that's going to have to get to the Lightning Deals department or the Promotion Department. And you have to find somebody who understands that “Hey, that wasn't my price. You guys are basing this on the wrong price.” The automated lightning deal system will not tell you what you need to see in a easy basis. I'm sure you already know that. So it's not necessarily easy to get there but that's the way it works. Brandon points out that you can set up a count code which you can offer as an upsell after the giveaway. For anybody who's rejected, they didn't went on the giveaway. You can in fact have a little coupon code and promotion. And now actually Amazon is giving some statistics based on the pull thru of those things. So thank you for that Brandon.
Empowery, the name says it all. Connecting E-commerce entrepreneurs with great people, ideas, systems and the services needed to sustain business dynamic into growth. Empowery is a network; a cooperative venture of tools and resources to make you better at what you do. Because we love what you do. We are you. Visit Empowery.com to learn more. You're listening to the Awesomers podcast.
38:59 (Steve answers more questions about PPC and Amazon tools.)
Steve: How do you manage your pay-per-click campaigns and she goes on to say, “Do you manually do this or do you use a service?” And I will tell you that most of the time we use a service. So first I'm inherently lazy, so let's get that on the table. And second I don't want to be an expert in every category. And even though I understand Amazon pay-per-click probably better than the average person, I'm definitely going to defer to the people who are in the trenches day-to-day. So one of the services that we often recommend, the fellow who runs that service. It's generally for a little larger companies but he used to be the sponsored products leader at Amazon. All the people who work for him came from sponsored products. They get it, they understand stuff. When we want to be in a beta, we’re in a beta, right? So we get access to to help Amazon so they can help us. And so that's one of the reasons why I use his service. If you're going to do it manually I would highly recommend of using some software called Zon.tools. Stefano Starkel put this together, it will help you get a handle on this thing and it's something that we should have in the Empowery service. So at least it goes on to ask which pay per click service to use, you can go check out MarketPlaceClicks.com, I don't know if Mike is taking on new clients right now. They have a pretty substantial and I would say successful agency, right? I do want to give you guys a couple pieces of advice. Number one, the Empowery E-commerce cooperative is where I'm going to do all of my future referrals. Because any of the people and the relationships that I have, I feed into them. And then all the people in Empowery do all the work to vet it, try to help work on a good deal and trying to not just vet the suppliers, but make sure that the offers are clear, make sure that everybody understands that work. So in the very near future almost every recommendation I have will have to go through the Empowery E-commerce Cooperative because it's a more civilized process if you will. So if you haven't checked out Empowery, go to Empowery.com check it out. It's an E-commerce Cooperative which means the members own it. It's a nonprofit, there's a little Scooby snack of fee in there but all those fees can be earned back from rebates, from suppliers. So it's a really important program and I highly encourage you guys taking a look at that. Okay so I think I've handled Lisa, Carl jumped on here and he's got a question that is... I can't see the full amount of the question, when it says see more it just pops up with a little smiley face.
41:55 (Steve talks about the indexing problem at Amazon.)
Alright so ultimately Carl is asking, “What's going out with the major indexing problem at Amazon right now and is there any solution?” So I don't think that they've solved it yet and I think a lot of it has to do with Amazon dramatically changing some of the things that they're doing and I've talked about this in the past but I want to reiterate this. My conversations at Amazon, we refer to changes that we see in our particular product or category or whatever. And we refer to it like that somehow Amazon wide, right? Hey I'm in whatever iPhone cases or kitchen spatulas and now you're breaking the reviews into individual reviews instead of rolling them up under the parent. Why is that? Why is Amazon changing that? But then somebody else will say, “Oh, in automotive that's not the way it is.” I want to just remind everybody that Amazon has data scientists and has people in charge of every single category. So there's a data science person for probably boat category, whatever's in the boating category, accessories or whatever for the outdoor category. And those data science people can change between the categories at their own discretion, multiple times a day by the way. So this idea that we all have that things are static or things are consistent. It's so much worse than you think it is. Honestly in terms of our ability to understand the levels of changes and the controls and the things like that. So to answer Carl's question, this indexing problem seems to be definitely more widespread. I think in some ways they're purging some of their caching that they've done. And if you guys know what that means, to make searching work really well you cache stuff. And then in updating semi frequently, the index will update and be still fast-acting. And I think they’re purging some things in the same way that they're purging reviews. Amazon has this, I don't know awareness that people are gaming the system and they don't like it. And I think all of us should pay close attention to this reality that Amazon wants to have a clean ecosystem. And as I tell them every single time, I talk to them I'm like, “You're killing the dolphins, we're the dolphins. We’re the good guys while you're trying to take out all the bad fish.” All these companies whether it's Ukraine or China that show up with 800 reviews in two days this is not a natural organic situation. This is highly manipulative and that's the people that should be squashed instead of squashing all of us along with it. I can tell you that Amazon is listening so because it's such a large company, remember everybody over 650,000 employees, when we go into Amazon and we talked to them again great empathy, great people but they literally when we tell them, “Hey this is happening and it's happening widespread.” They're like no idea, where they had no idea and they're in departments that you would think would know. You definitely know more than the average Amazon person working there. You definitely do. That said we don't have the buttons that we can just make the changes that we feel need to be changed. So we have to then convince them and influence them. And one of the ways to do that I've shared this before but I encourage you, if you haven't already go write a Dear John letter, Empowery.com/DearJohn. You can see the Dear John letter there and you can see an example that I wrote. And really this is us to say Amazon here's what's coming in the future. We're going to break up with you if you keep treating us like crap. And we don't think we can make money or we think that there's a better alternative. And Amazon executives know if there was a better alternative today, sellers will be leaving in mass. If you agree with me go ahead and put yes in the comments of the chat. Just see if you check my water here, if you had an alternative that was powerful that you felt. That you could put against Amazon you would definitely at least be on that platform in a big way. And considered leaving Amazon together I suspect, let me know. I see some yeses coming in 100%. So this is the point everybody, if we can only make an alternative when we kind of work together that's part of the point of Empowery. If you band together then you have influence, then you have political power, then you have the opportunity to say to them, “You know what? You know we're sick and tired of, so we're not going to take it anymore.” And believe it or not they really are listening even today and again if you haven't done it go Empowery.com/DearJohn and get on the ball. This is an important initiative and it is a true chance for you to speak directly with Amazon executives. Not just like a passive “oh they got a copy this email, I wonder if they'll read it”. Some of the people in Amazon in their Sellar Experience Department are taking these letters. And they're putting them up on the wall right next to executive boardrooms. This is not graffiti by the way, this is invited by Amazon. They're taking these big letters and by the way they're putting them right next to the hero stories, right? So we have a lot of our members especially Catalyst88 members. They have their pictures, big posters of hey look at this success story. They used to do this and now they have a wonderful life and a wonderful business. Amazon we're heroes. And they Amazon employees rightfully walk around high-fiving themselves, right? Hey we're heroes huh, you know you get your winged jet, that’s awesome but we're trying. And Amazon actively is trying to balance the story by saying it is not all rainbows and unicorns. There's some things that are happening here that are unacceptable. And I think in some ways unintentional. Again dolphins are being caught in the net, save the dolphins. Alright, so I know that was a bit of a rant. I can't give you a clear answer Carl except to say I expect it to settle out. There are a couple little tweaks that appear to be working but not enough data for me to share yet. But Amazon as they continue to get through their split testing, I think it will get back to normal but expect things to be different that's the fundamental takeaway you guys should have. What worked four years ago, three years ago, two years ago, two months ago, may not work two weeks from now. And Amazon is really really active trying to make sure they're not being hoodwinked. Okay so I had another question. Now if you guys have questions on Facebook get them in and if you have questions on Zoom get them in. I'm going to read some of the questions that were pre submitted and we'll get through a few more of these. And then we'll tie it off here in about 10-15 minutes.
49:06 (Steve answers question about patented products.)
So one of them, one of the questions that came in ahead of time said, “Hey, how do you guys check if a product is patented?” And I've seen lots of answers to this question and somebody goes, “Hey there's a course on Udemy and you know for eight dollars I became a patent expert.” And you're welcome Carl I appreciate what you do as well. I could just tell you you're not going to be a patent expert for eight bucks. And you're probably not going to be a patent expert even after four years of law school, you're going to be a patent expert after you practice patents for years and years and years after law school and all that. So unless you have years and years of experience I highly recommend going to an expert and having them check into it for you. If you truly believe the product has potential. Now sometimes people go well I don't know if it has potential so I don't know if I should spend any money. It's time to take a hard look and decide if that's a real business that you're trying to build or just some little passive thing. And if it's a passive let's just give it a go and see if it works. Then maybe your patent risk is not that high. But if it's a serious thing I would go to Rich Goldstein and he's in one of the Awesomer podcasts. Spencer if you could find that put the link in there that would be helpful. But Rich is a brilliant patent guy. So he was trained as an engineer, very few attorneys by the way are trained as engineers. So he's a trained engineer and he's an attorney and he's an entrepreneur. He's my kind of guy for sure. And this is somebody that you could trust. This is somebody who gets it. And he or his firm to put it properly, they will be able to give you a quick analysis or a quick understanding of hey here's how much it's going to cost you to find out this answer are you interested or not? And then you have assurance, they're not going to make a mistake and if they do they have some culpability. So they're going to do the right thing. The other thing if you really want to do cursory searches for patents that's easy enough to do. But if it's a serious product I would highly recommend using an experienced patent firm and I'll give you one quick example. There was a shelving unit that we wanted to build, I was in the furniture business. And we wanted to build a shelving unit which was a no tools assembly. And so we noticed that the some guys had this product out there and they had a patent on it. And we're like all nerds, we don't know what we're doing here. How do we do this? So I paid a patent firm to tell me how to work around that patent. And that's the other lesson I want to give you guys in. And thank you Spencer a really good reason to go listen to Awesomers.com/21 with Rich. Where we talked about just because you have a patent doesn't mean that you're not violating somebody else's patent by the way. Let that sink in for a minute. Just because you have a patent doesn't mean that patent doesn't require somebody else's patent to be sold. And a lot of people think once you have a patent you're home free. But as a quick case if you sell snow tires you still have to pay the patent guy who has the patent on tires, just as a simple example. You to make $8 course is not going to get the job done. I'm going to skip that question, I'm going to let you guys get any other questions. I'm going to try to get to a couple of these others that I feel more let's say passionate about.
52:35 (Steve answers a question about shipment inspection.)
So this is one of those questions I'm likely to rant on. so somebody said, “Hey, do I really need to inspect every shipment in China? The first couple that I inspected, the inspector didn't find anything.” So it feels like a waste of money, right? And this is one of those times I just want to shake you, I just want to pick you up and shake you. I swear to god, I've been doing business in China a long time and regularly I am schooled by people who say, “Well I've had six shipments from China and I haven't had one problem” or “I've been doing business in China for four and a half years and I have yet to have a single problem”. And this is the way we always do stuff and so I'm fine to be wrong as my axiom zero says I don't know nothing about nothing. Just assume I'm wrong but here's what I could tell you for doing business in China for more than 15 years. Tens of thousands of containers and countless money spent in inspections, it will always be required to inspect your shipments. The minute you stop inspecting, you will see an immediate quality fade because the factory knows you're not watching them. And if you don't know what quality fade is go read the book as I've recommended before Poorly Made in China by Paul Midler. That will tell you how China operates. Every second that you are not there in the factory with your eyes on them or having purchase order with very specific specifications. And I'm talking about weights and densities and all kinds of things. Every one of those things the Chinese factory will find some way to increase their profitability and their efficiency. They'll find some way and that's okay because that's what they do. It's not okay from a quality perspective, it's not okay from a customer service perspective. But it's okay because that's the way it is, your job as the brand owner and as the product builder and so forth. You have to keep them honest and they're far more likely to stay honest and stay on top of it. If you have inspections as a regular part of your process, the minute I'm telling you the minute you stop doing inspections you will watch the quality fade. And at first you won't quite notice it, maybe the package was a little different and maybe a little lighter weight or whatever. We had one time a factory they changed the exterior plastic on our cartons. Where the nice carton’s wrapped in this nice low gloss satin finished plastic, non-skid. Really nice. When you felt that you're like, “God it feels nice.” And even though it was against spec they changed the spec and that these packages would slide like they were on wheels, it was so terrible. And before it left, we had them replace all of those packages around like ten thousand cartons they had replaced the packages. In other cases we've had some sort of wax overspray that was on the the products that we made them hand clean, countless. I don't really remember. Two containers worth of product before they sent it. And this is very experienced factories with doing millions of dollars of business with them, they still make mistakes. So believe me you definitely want to pay attention. And Spencer thank you, upcoming this Saturday we're releasing my extended rent on the book Poorly Made in China, a book review style and you can check that if you feel like you're doing things. So one other note, I saw this on a Facebook group recently and this is somebody trying to help. So I'm not punching them in the face, I'm just kind of hitting him in the shoulder going, “Hey buddy, pay attention here” and this is what he says, “Hey guys if you need a simple inspection of quality packaging label, etc. Just ask your forwarder to do it. Hashtag save money tips. And again I just want to shake it because this is the worst possible advice you could get and by the way feel free to ignore any of my advice. It's free anyway, I'll give you your money back. But when you see advice like that please please don't pay attention, a freight forwarder couldn't care less about your labels or your packing or your service or any of that stuff. All they care about is the product ready to go. One, they said get it in the container let's get it shipped. That's how they make their money. Saving money, right? This is Pennywise pound-foolish, saving money with that kind of stuff is terrible long term, you will have far more problems and if I told you that the count of times where we made mistakes. And we paid tens of thousands and claims or had to recall tens of thousands hundreds of thousands of product fixes. It doesn't hurt to pay a couple hundred bucks for an inspection and by the way Empowery has laboratories in China being vetted, inspection companies in China being vetted, trading companies at will it can even offer you credit at a reasonable volume level. So again there's a little plug for Empowery. By the way I had to buy into Empowery, I had bought my share, I paid my admission, I'm just like anybody else. I don't own Empowery, I just funding it to try to get it going.
57:57 (Audience question - does anyone use more than one vendor for the same product SKU?)
Okay so somebody else asked and this will be a last couple questions here. Does anyone use more than one vendor for the same product SKU? And then they go on to ask, will the customer notice any variations? Now first of all if you are going to produce in more than one factory the same exact SKU, your customer should not notice the variations. If you're doing the job right. If they're following the specifications, if they're doing the pack exactly the same, the size of the specs, you shouldn't have any variations for them to notice. And I could tell you unequivocally that large companies they'll fork their bifurcate if you will. Their production between large companies so they're not in subject to just one factory. If that factory burns down and by the way I've had more than one factory burned down in my history. And when that factory's gone, it's gone. So large companies will often use a hedge move and bifurcate their supply chain to have multiple factories making the same SKU. You should not notice it if your specs and your inspections are done right. Now the question is whether or not you should do that, first of all I like the idea of redundancy. If I know a lot of people especially when you get with your first supplier, second supplier maybe you've actually gone through a few suppliers, but you found one that you kind of get along with. And you like the sales rep. Now they will treat you like they're your buddy, right? Hey you know we've got a relationship here and and so forth. And that's great but just know that's part of the manipulation that's happening. And I still would recommend a hedge move. So how does that work? That means you take some production samples from time to time maybe once a year, and you take them to other factories, and you get other price quotes that's right? So this is a way to keep your existing factory honest on price and it helps you get other guys up to speed. You could even have a make samples for, you pay for the sample but if you need to make that change then you have other factories ready to go. And this can be very very additive if you have high velocity moves and you need to make a change. So if you don't have high velocity, don't worry about it. Don't add the complexity. But if you do and it's something significant think about this as a hedge move. This is an important thing to consider. And again your customers shouldn't notice product variations for two reasons. One, they don't have the other product from the other factory to compare to generally. Unless it's a repeat purchase. And secondly if your specs and inspections are right there, should be no variation to begin with.
1:00:37 (Steve answers the last question and wraps up the episode.)
Steve: Okay so last last word here. Somebody says they seriously need to optimize their international Amazon accounts. If you're selling internationally and you don't speak all of the languages as a native speaker which you can only have one native tongue generally. There's some exceptions I suppose in many of the countries, if you grow up in Switzerland you're probably going to speak French and German for example. Holland has a lot of French and Dutch and German and so forth. But for those if you're really not an expert in the languages, I highly recommend getting somebody who can help you with those languages. And has native translators to help you with all the things, titles listings, bullet points, keywords. If you don't do that, I think you're at a disadvantage. And I'll give you a quick example at one point, our Italian efforts for a brand that I've since sold that Italy was beating Germany. And that there was no reason in the world Italy should ever beat Germany in terms of sales. But it was beating Germany's in our opinion because the Italian translation was spectacular and very very good. And our German translation was spectacularly very very bad. So the opposite of good as I like to say. So the point is, if you don't have your house in order to get that right, there's lots of services that do it. Empowery is vetting a company right now, it's about to go live. And we really believe in them, they're based in Europe, they understand all the European languages. There's of course similar opportunities for Japan and so forth as well. So definitely take the time remember that native speakers will know that colloquialisms. They'll know all the little ways of saying things that you may not pick up on. And if you just do literal translation like if you just say translate cell phone. But in Germany they call it a handy, right? That's the name of a cell phone, a handy. You wouldn't know that you start throwing handy on cell phone stuff in America. You might have some problems you know we got Handy's on sale over here at Amazon. That's going to be an issue. And if you don't know what I'm talking about you can go Wikipedia that thing. So my point is as always local language matters. Please committed enough to the market opportunity to spend a little bit of money. And that's probably my final word. Don't forget to spend a little money on your business. So for those of us in life you already got the benefit of this, for those listening later on the recording this is Awesomers.com episode number 66. All you have to do is go to Awesomers.com/66 and you'll see the show notes, details, transcript. And anybody who's live with us, if you weren't here in the beginning you'll be able to find all the details and so forth, from the top of the show. So any last word or questions? Any final words from the audience out there? I've got a bunch of people on both of these screens. I'm just going to wait just to make sure I'm at your service. Alright, probably been discussed. Getting a review banned listed, that's a problem for another day Troy. There's been some modest progress on that but it is not easy and it's not getting easier. And by the way if you had a bunch of reviews destroyed and it's destroying your business, get in touch with me on Facebook, where we're going to the press for people who really have high impact. And we're trying to do some people on the record, some people off the record. But this is a large publication, they're willing to do a story as long as the story is compelling. Obviously the editor makes the final call but we have the writers interested and this would be a very high profile. And our intent by going to the press is to say Amazon, this is having a massive material impact to the economic viability of our lives, our businesses, and you're paying lip-service or you're ignoring us or whatever this needs fixed and it needs done in a proper way. So if you think you've had reviews unfairly beaten down, please contact me. There's a little group that started, there's a couple of us talking about it and we've already had discussions with several publications and a very large nationally prominent publication has expressed interest. So please don't hesitate to communicate and get on board with that. So thank you again everybody. I hope you joined us on the Awesomers.com podcast series. If you haven't joined, please go subscribe. If you haven’t joined and you haven't left a review, you are now my mortal enemy. No, just kidding. I would appreciate reviews even if you think it sucks, that's okay. I just want to know if the juice is worth the squeeze. So thanks again everybody. Thank you Lisa. Thank You Becky and everybody out there. I appreciate what you guys do. I love entrepreneurs. So that's how we got into this mess to begin with. Thank You Jane. See you later everybody.
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Steve: Well there you have it, another back talk live episode and we call it back talk live just because it's more fun to say that and give the audience a chance to interact and be a part of the show. And it's a very unique opportunity for you to not just hear what other people are thinking about and hear some of the news items and so forth, that we think are important but also the chance for you to personally get involved and ask questions there. You don't have to buy anything, you don't have to pay any money for this. It's something that is free. It's relatively unbiased, I have my own biases when I'm answering your questions but they're based on experience. And so yes I'm not holding back or trying to tell you, “Oh I'll tell you the answer if you send me a check.” I will give you the honest truth as I see it, whether I'm right or wrong. That's another coat of pain and up to somebody else to decide. But it's certainly I give you the most truthful answers I can, based on how I understand your situation and your question. As well as applying that question to a situation to my own past experience. And so I hope you guys enjoy it. I really do encourage you again to go to the Awesomers.com Facebook page. Hey you can leave us a review there. You can leave us a review on iTunes. And you can also join the Awesomers.com Amazon Professional Sellers group to get involved on a more regular basis. And help each other, help the community, that's part of paying it forward and being a good citizen. So I hope you guys will consider doing that and we'll see you again very very soon.
Well we've done it again everybody. We have another episode of the awesomest podcast. Ready for the world thank you for joining us and we hope that you've enjoyed our program today. Now is a good time to take a moment to subscribe like and share this podcast. Heck you can even leave a review if you wanted Awesomers round you will appreciate your help it's only with your participation and sharing that we'll be able to achieve our goals. Our success is literally in your hands. Thank you again for joining us. We are at your service find out more about me Steve Simonson, our guest team and all the other Awesomers involved at Awesomers.com.Thank you again.