Joel Reichert, who quit his job in corporate finance a couple of years ago to dabble in e-commerce, has officially been bitten by the Amazon bug.
First, he and his wife started selling baby products like bibs, burp cloths and blankets under the Copper Pearl name via on Amazon.com. After growing the brand into a multi-million dollar business, they sold the company and started focusing more on their new Amazon venture: Maven Thread. The brand sells women’s exercise headbands and is gearing up to expand its products.
During a session last week at the Internet Retailer Conference & Exhibition entitled “How to launch a new brand on Amazon in six months,” Reichert shared the most important lessons he’s learned from his e-retail successes with and underlined his conviction that anyone can do it.
“We’re a very small business—not a large business at all—so this is a very attainable path to success,” Reichert said. “I didn’t have any background in e-commerce. Didn’t have any entrepreneurial experience from my family or anything. Just kind of started small and figured it out.”
Why trust him? Here’s is what he has accomplished with little resources and experience.
- Launched in June 2015 and sold in March 2018
- Started with one SKU and expanded to nearly 200 across nine product lines in two and a half years
- Has more than 7,000 five-star reviews on Amazon.com
- Has grown to be a multi-million dollar business with diversified income from sales through Amazon.com, CopperPearl.com and more than 1,000 wholesale accounts
- Launched in June 2017
- Started with two SKUs and expanded to 14 with more products launching and more than 13,000 units sold in about a year
- Has more than 300 five-star reviews on Amazon.com
- Sells through both Amazon.com and MavenThread.com
10 tips from a successful Amazon seller:
1.) Don’t assume seed money has to have six figures:
“I really feel like starting small is the best way to go,” Reichert said. “Some people are intimidated and think that starting a new company costs hundreds of thousands of dollars or tens of thousands of dollars.”
But with both brands he started, the total investment was a more feasible $10,000. The money went toward inventory, logo design, brand development and paid marketing. Reichert and his wife stayed on a tight budget and then reinvested the profits as sales started coming in.
2.) Consider the nuances when selecting a product to sell:
Reichert suggested using Merchant Words to conduct some keyword research. If sellers are curious about a particular product, they can look up the terms “exercise headbands” or “baby bibs,” for example, to see how many people search a given keyword on Amazon each month.
“You try to find something that has a lot of traffic (and) something that you can get at a decent price point,” Reichert said. “I think a lot of it comes down to trying to find a good manufacturer, too—that’s one of the hardest things.”
Selling at a premium price point is a lot harder for a new business owner, according to Reichert. But if sellers can zero in on a high-quality product, offer it at a reasonable price and provide solid customer service, they possess the most important puzzle pieces necessary to gain traction on Amazon. “I feel like if you do those three things, that’s kind of the easy formula for success—especially when you’re brand new at this,” he said.
Reichert prefers to sell smaller products that are lightweight since they’re easier to ship, and he gravitates toward textiles because he can differentiate based on design, which is his wife’s domain.
3.) Focus on a smaller number of SKUs:
Since Amazon is so review heavy, listing hundreds or thousands of products is tough unless sellers can figure out how to get customer ratings on all of those items, Reichert said.
“It’s tough to get the sales velocity. You’re not going to have a thousand products on the top one or two pages. A lot of your products are probably on page five to 10 or 20,” he added. And that likely would only lead to a sale every few days or every couple of weeks.
“I think it’s a little bit easier to have a narrow category and put a lot of emphasis on paid advertising (and) reviews—to get that specific listing (ranked higher),” Reichert said.
4.) Make sure listing content is polished:
“The content piece on Amazon is very, very important,” Reichert said. “There are so many products on Amazon that look very cheesy or cheap or they’re from overseas brands where the photography is not very catered to the audience.”
Getting a professional photographer to shoot product images is critical, he added. So is hiring a copy writer if sellers don’t have the skills to write descriptions and articulately list crucial bullet points on their own. Before launching a product, sellers also should spend time dreaming up a brand name that makes sense and has a nice ring to it along with designing a logo—and it doesn’t have to be fancy. Something simple and clean is just fine, Reichert said. New brands also will want to get trademarks as part of the process of opening a storefront.
“Stuff like that to make your brand official and legitimate I think is important,” Reichert said.
5.) Understand how keywords impact Amazon’s rankings:
“In the back-end of Amazon, there’s a lot of stuff you need to do to be found in the algorithms (when) people go into the search bar,” Reichert said. “You have to put a keyword to the back of your Amazon platform so that people can actually find you on there. That’s a little piece of information that a lot of people don’t (know and) do.”
Once he completed that step for Maven Thread, the brand’s headbands started appearing on the first and second pages of Amazon search results for terms such as “women’s exercise headbands” and “women’s yoga headbands.”
6.) Invest in paid advertising for sales to pick up:
“If you type in ‘women’s exercise headbands,’ you might get 60,000 results. So the question is ‘How do you get in the top 10 or 20?’” Reichert said. “Because if you’re not in the top 20 or 30 searches on Amazon, you’re pretty much not going to get sales. And that’s one of the first things people find as a challenge on Amazon—is just getting found.”
According to Reichert, the best solution is to invest in paid advertising right on the platform. Amazon has its own pay-per-click advertising platform called Sponsored Products, and Reichert said he spends a lot of money on that—hundreds of dollars a day. Even in the beginning, the company shelled out $50 to $100 a day. This investment funnels traffic to listings, which jump-starts sales and spurs the all-important reviews.
7.) Court customer feedback:
“Reviews on Amazon are one of the most important things for conversion,” Reichert said. “The more reviews you have that are four or five stars, the more likely you are to get sales.
“I would say (the magic number is) at least five to get it going. Any time you have one or two or three, people kind of assume it’s like friends or family,” he added. “Once you kind of get to five, six, seven, I feel like it starts looking legit. I would say I’d go for 20 and above. It makes a difference.”
Since the exercise headbands were only launched in the last year, Maven Thread has accumulated between 20 and 50 reviews. Reichert said he prefers to get the first five to 10 reviews in the first couple of weeks of a product launch, and in the long term, he’s “pretty happy” with anything over 20 or 30. A seller with a thousand reviews to another’s 30 obviously has a leg up, Reichert said, but he’s found that 30 vs. 70 isn’t enough of a disparity to sway a buyer.
Reichert has used the Amazon Early Reviewer Program, which he ball parked at $60, for the first five reviews. When an item is purchased, Amazon offers a small incentive—an Amazon gift card in the amount of $1 to $3—to the buyer to leave a review. His brands also have had a lot of success using FeedbackGenius, which sends automated emails to the buyer prompting feedback.
“They get an email that says ‘Hey, we’re a small business. Thanks for buying. We really appreciate it. Can you please leave us a review? It helps us so much as a small business,’” Reichert said. This program alone gets him two or three reviews for every hundred sales.
8.) Keep tabs on sales volume:
“The first few weeks are the most critical—especially on Amazon,” Reichert said. “If you strike out in the first couple months, I would say it’s kind of tough to regain momentum.”
He ideally aims for a few sales a day within a couple of weeks of a launch. A lot of those are probably going to originate from paid advertising, according to Reichert, who shared his high-level metrics. He spends $20 or $30 a day on this at the outset, and that might only generate two or three sales a day, so it costs his company about $10 for every sale it receives.
As he gets more reviews, though, the conversion rate increases, and then after a few months, Reichert expects to sell at least five to 10 units a day on a given product.
9.) Brand e-commerce sites play a role but are secondary to Amazon shops:
“If you are thinking about starting your own company, I love Amazon. I think it’s the first place I would go to launch a brand just because it’s easier than starting a website,” Reichert said.
Both Copper Pearl and Maven Thread have e-commerce websites, but they’re secondary. Reichert typically focuses on building up Amazon storefronts for about six months to a year and then takes cash flow from those sales to invest in growing a brand’s e-commerce site.
10.) Still build out social media pages:
Even if brands sell exclusively on Amazon, Reichert thinks Facebook and Instagram pages still play a role. Sellers should simply link to their Amazon stores and slowly build up their following.
With his Copper Pearl brand, Reichert would get 200 or 300 sales the first day a new product launched just from posting on social media. “And on Amazon, that’s super powerful, because if you’re selling a lot of units on the first day, you’ll start getting ranked with the algorithm really fast,” he said. “With Copper Pearl, as the brand got bigger on Amazon, we really wanted to focus on the website, so we changed our link in the bio to our website. Amazon (sales) didn’t really suffer, but it really helped our website.”
Social media pages for Reichert’s newer brand, Maven Thread, direct shoppers exclusively to Amazon. He said he plans to keep everything linked in that manner for another few months or so to keep funneling traffic to Amazon until he’s ready to siphon off business to the brand’s e-commerce site.
Amazon is No. 1 in the Internet Retailer 2018 Top 1000.Favorite