The E-commerce Leader

[00:00:00] Jason: one of the things you gotta figure out is what’s the outcome of the traffic and is it good traffic or bad traffic? Cuz if it’s bad traffic, to your point, and it totally ruins your conversion rate, you’re gonna down your, overall vibe on Amazon
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[00:01:15] Jason: External traffic. Coming to your Amazon product listing is a very on trend thing to talk about, and in this episode we are gonna break it down. Is it all it’s cracked up to be, or should we skip over it and just stick to traffic strategies on Amazon itself?
[00:01:31] Michael, are you ready to jump into this? Great.
[00:01:34] Michael: Absolutely ready. Yes. I feel a bit bad in the sense that we’re talking about something with a bit of a view to, in many cases, not doing it, which sounds a bit of an odd thing to say, but the reason I’ve raised this topic is because in the real world, I see this a lot.
[00:01:46] I spoke to a guy even just yesterday who’s an American seller who I’ve done some one-to-one consulting with who’s using external traffic in my opinion. In a way that is not gonna get his objective. And I’ve seen that quite a lot recently with the mastermind. Six, seven figure sellers who one would think might know more.
[00:02:02] Turns out they do a lot of stuff. They put a lot of faith in external traffic and yet some super smart people I know in the AM Amazon universe are doing a lot of external traffic plays. That makes sense. So I think really this is the main purpose of today’s episode is to help really answer the question, should I use external traffic?
[00:02:15] And some basic questions to ask and some strategy level thinking. I can’t give you the latest TikTok strategies. Cuz that’s not my expertise. The best place for that would be listen to the interviews I do on the 10 K Collector podcast.
[00:02:27] Jason: I love this topic, man, because it is a really interesting question because there’s a lot of variables.
[00:02:33] And so I think it’s worthy of a deep dive conversation. Of course, I love all things. Internet traffic, my nine Mountains of Traffic book was all about this topic. And, I’m destination agnostic in terms of where traffic gets sent to, but of course there’s a lot of strategy at that, part of the question.
[00:02:50] And, I think this, just this question of whether you should or shouldn’t get external traffic to your Amazon listing, I. More complicated than it first appears, and it takes a little bit of, wisdom or discernment to figure out is this a good play for you? And if so, how can you do it and know that you’re doing it well.
[00:03:07] Yeah. Let’s jump into it, man. What are your thoughts on how to outline this?
[00:03:13] Michael: So then the first thing is really basic, but I see a lot of people just completely skipping the step. So we have to revisit, which is, what are you trying to achieve? Clarifying your objectives. . And I think the first thing is, I see a lot of mismatch between what people are trying to do and what external traffic will and won’t do.
[00:03:30] There’s a lot of limitations. The first thing is be realistic. The first, very first point is trying to treat an Amazon listing like a direct to consumer site is a massive mistake. You can’t really drive external traffic directly to an Amazon listing with external traffic and expect to make a profit.
[00:03:44] That’s the first thing to say. It’s a different universe cuz you can’t upsell down sell or cross sell in the way you could do your own Shopify sites and you can’t on Amazon directly. Capture a lead in order to, for example, take it into an email nurture sequence over the next six, 12 months.
[00:03:58] Jason: It can you treat Amazon like a direct to. Selling system.
[00:04:04] It is direct to consumer. Amazon is selling the item. It’s this channel that’s direct to consumer, so it is in fact direct to consumer, through the Amazon system. They’re the seller of record, of course. But you’re the provider of the product. That’s, that is a little bit different than, let’s say a pure wholesale or, where you’re just working through a distributor.
[00:04:25] So I think there’s nuance at that level.
[00:04:27] Michael: Let me clean up my language then. It’s not your own store. You don’t control the flow of the customer once they get there.
[00:04:33] That’s what I guess I was trying to say.
[00:04:35] Jason: That’s true. Okay, So assumption and a little bit number two to just pick on, Continue to pick on the thread you absolutely can send traffic to Amazon profitably.
[00:04:46] The question is, what’s the cost of the traffic. And what’s your cost of goods for your product on Amazon? So if you. So it’s way over generalized to say you can’t make it profitable because let’s just say you’ve got a 17 times margin on your product. You buy it for a dollar and you sell it for $17 or whatever, multiple about, you wanna extrapolate out.
[00:05:07] There’s tons of margin there to make a profit. If it’s a three times markup that you’re operating on, you’re not gonna make money no matter what you do. So you won’t be profitable with a, two or three times. , regardless. So I, that certainly has to come into consideration.
[00:05:22] If you’ve got a product that because of your unique opportunity in the world or your, domination of some special source or something like that, you’ve got crazy margins, then you’ve got the makings of sending traffic from anywhere you want in the world to that product and making it, profitably done.
[00:05:39] So I think there’s a big question mark there is, what types of products are. Possible to, to make a profit on inside Amazon or with external traffic either way. So just a few thoughts. I dunno if that provokes any counter arguments.
[00:05:52] Michael: I agree, by the way, it was a massive generalization.
[00:05:55] I I suppose what I should have said is a, I’ve never seen somebody do it successfully. That doesn’t necessarily mean that aren’t people out there doing it. You’re quite right. It just comes down to the maths. But I would say the maths are fairly brutal. If you, This is one of the simple things that I was saying to this guy yesterday.
[00:06:07] I was advising, So he’s spending about 5% of his revenue on Google ads and he was saying, I’m just running a break even. I really wanna make a profit or I’m gonna just sell this business. I say, I said, Okay, before you try and sell a business, which is hard to sell without any profits, for starters, have you considered getting rid of your Google ads for the moment?
[00:06:21] Because, it’s very hard to. External traffic to convert in the same level as Amazon. Let’s put it this way. Sure. If the numbers stack up, you’re quite right. It could work. You’re completely correct. I dunno, many people who sign seller the 17 times markup, that may be part of the secret. You completely correct.
[00:06:36] Yeah. Do, So that’s why we have a different perspective from me. Experience totally makes sense. But I would say that on Amazon you have shoppers and that’s it, whereas, on the window shoppers sometimes they don’t always buy, but they go the shopping buying intent.
[00:06:49] Whereas on Google, obviously you have, surface shoppers and seekers, so people who are just surfing around for entertainment and obviously these days on, on social media, that’s a lot of what happens as well. You got people looking for an answer to a question. What’s the best, antiinflammatory cream for my legs, or something like that.
[00:07:04] And then best anti-inflammatory cream. Very specific person, very specific type thing. So buyer type keywords. So okay to get the same. Buying intent from external traffic is gonna be hard, so to get the profits gonna be much harder. Let me put in more your version out there.
[00:07:18] Jason: Yes. Those are, to make money on the internet is hard. It’s yes, it’s definitely hard. So then the, Let’s just say though that you’re in the elite group that actually has good margin and you’re on Amazon and you’re making good money, and you say to yourself, Hey, how do I make it even better?
[00:07:39] Then? Then the debate in your mind is, Should I go get traffic off of TikTok and Instagram and Facebook and Google AdWords and send it all? My Amazon listings, because that’s where you’ve got your home base of, sales velocity. Or would you send it to your own Shopify site, for example? That to me is the interesting, question in that, situation.
[00:08:01] Now there’s reasons to send it to Amazon, which, you can sort through. And I think that’s what some of your, the line of thinking is here for this conversation is in what case would you send traffic? Amazon externally. And, all things being equal, if it’s, if it’s profitable, it does give you options.
[00:08:16] The person who has profitable products has options. A personable person who can acquire traffic profitably or for low cost, that’s buying, buying customers or buying prospects. Those people have options. So anyway, I guess not to muddy the waters too much, but I would just say those are some distinctions if you have a profitable product and if you can acquire.
[00:08:36] Reasonably affordably for you and still make money, then what should you do? Should you send it to. Yeah, it’s
[00:08:43] Michael: a good point. So I guess it, the, what my summary of what you are saying is really to remember that it’s two sides of the cost of acquiring the customer versus the profit.
[00:08:52] If you wanna put it, that’s not so much live to customer value, it’s a revenue number, but the profit margin, I guess the gross profit margin, right? And if that’s big enough, then you have a heck of a lot more leeway to be a bit inefficient with your ad spend, but still make a profit. So you are absolutely bang on.
[00:09:05] I guess if you are moving in universe for people with 17 times markup, then they have a whole lot of leeway. . . So to simplify this down, I think one of the things that I see again, it sounds like a, the statement, something very simple, and hopefully this is a simple enough point to be, Something where we can help people.
[00:09:21] If you have a revenue only target, that is to say you want to increase sales, which people say to me, they don’t even necessarily define whether it’s unit sales or revenue. They’re hoping for both . . Then, you’re gonna get what you wish for if you obsess about that and then what they normally meant when they come.
[00:09:35] Lot of ’em, people come to me or voice things in the mastermind. These are normally earlier stage sellers, but not always super early stage, like mid six figures I’ve seen. And they’ll say, Why haven’t got, I got any profit? And to which my response is, I dunno how to put this politely, but you prioritize revenue, so that’s why you have revenue.
[00:09:50] May I suggest reprioritize profit at this point? Normally, to which they’re very agreeable at that point. So it sounds like an obvious thing to say, but it’s even more basic point is. If you don’t make a profit target, you probably won’t end up with profit, especially in my experience when you are using external traffic because part too well, you were just saying, generally speaking, it’s gonna be a lot harder to make
[00:10:08] Jason: profits.
[00:10:09] Another way to say what you, to re repackage what you just said is, if you’re not profitable, but you have revenue, You’re overspending duh, like you, you’re clearly, if you’ve got some revenue coming in the door, I don’t care if it’s a thousand dollars or a hundred thousand dollars a day, a week, a month, it doesn’t matter if you’re not profitable, you’re overspending.
[00:10:29] And so then the question is where are you overspending? And that’s really what. It comes down to, is, how do you, make sure that you’re running in the green or the black guess you could say, not in the red. So I think that makes sense. I
[00:10:40] think there’s a most, the most obvious use case for why you would send external traffic to your Amazon listings.
[00:10:49] And I’ve seen our clients and our coaching consulting work do it is because they’ve exhausted the amount of traffic they can get inside Amazon.
[00:10:57] It’s kinda like an obvious thing, but if you’re already, let’s say you’re just number one and your bestseller rank for your, seven inch on Amazon, it’s great to be you. Congratulations. And let’s say, let’s say you’re spending money on AMS ads and you’ve. A positive roaz, your, return on ad spend is a positive integer and things are good for you.
[00:11:17] That’s still gonna be a capped, there’s an altitude you can climb to in that system. Let’s just say, let’s say you found all the buyers that are showing up on Amazon that want your certain kind of widget. Can you imagine if that was actually possible? But let’s say it was then in that case, what do you do?
[00:11:34] And the answer is so simple. It’s go. People on Google AdWords that want the same thing and send them to your Amazon listing. So I think that’s the most important thing to think about is, have you exhausted the amount of traffic inside Amazon? Then you wanna go look for more other places?
[00:11:50] I know if that resonates with you, what your thought is in that or
[00:11:53] Michael: Yeah, you’ve, Yeah. And again, that, that’s an extremely well put, and I think there’s a, that’s a very good reason to, to consider external traffic and to investigate it thoroughly. What I find a lot of the time is that people have not, Done what you just said, which is exhausted, what they can do on traffic on Amazon.
[00:12:09] They often do the opposite. They’re ranking very badly on Amazon and instead of working out why that might be and trying to solve questions like, is your pricing not quite right for the market? Is your, is the messaging including videos and images on your listing not converting as well as it could have you really done an incredibly thorough job of working out which keywords are winnable and targeting those.
[00:12:28] Yes. And including your PPC as well. So all of those things, convers rate optimization and in. Amazon ppc where people are much more likely, in my experience anyway, to be shoppers than searches and therefore to buy, that’s people wanna
[00:12:42] Jason: maximize. Please. Can I share a real example? Okay. This is for my own, list of products on Amazon.
[00:12:47] I know you didn’t think I had any, but I do. I do. And the books. The books I’ve, the books. So here’s an example. I’ve got this book for our charity called We Are So Powerful Now in any. Day of the year, it might be residing in the top 100 BSRs in the charity and nonprofit, subcategory on Amazon in the, let’s just say it’s in the bottom of the pack.
[00:13:09] It’s maybe from the 40th, best in the BSRs to hundreds best. It’s generally on the list and it’s generally there. I’ve run AMS ad campaigns inside Amazon to, and tried to spend some money and they’ll fail, not make, it’ll be a negative roaz. So then what happens is I’ll use my email list and I’ll do some kind of focused promotion.
[00:13:31] Like the last one I did, just to be very specific, was about a week and a half ago I said to everybody, Hey, everybody on my list and I’ve got 26,000 people on my list, for our charity. And I said, Hey, everybody. We are so powerful book on Amazon has 92 reviews and I sure would love to get it to a hundred reviews.
[00:13:49] So if you haven’t reviewed it yet, would you please, and you liked it and you read it, go give us a review on Amazon. And if you haven’t picked up a copy yet, then you know, here’s the link. And wouldn’t you know that thing shot straight to number two and on in the best seller ranks. And so for a few days, Number two, and I remarketed and did a few other things.
[00:14:08] Cause I was like, Man, it could be number one. But then what happens, and this has happened for years now, so I know the pattern. It will decline in the best seller ranks. It’ll be number 12 for a while, then it’ll be number 19, then it’ll be number 36. And then here it is today. I just looked this morning and it’s like number 67 out of a.
[00:14:28] And so what does that tell me As the marketer, it tells me what you exactly just said, Michael, which. The description isn’t tuned up enough. Maybe it’s the title of the book. Maybe it’s the bullet points. Maybe it’s the, the reviews and testimonials. Those things in and of themselves is not keeping it cooked in at number one.
[00:14:49] And so I have to use external traffic to boost it, but that won’t be sufficient to keep it there. And it’s a really important thing to think about is like what are the elements on the Amazon product listing. That will make it number one by itself. And if you obsess over that more, then everything else will be easier afterwards.
[00:15:07] Sorry, long winded, example, but no, it’s
[00:15:10] Michael: a great example. I think what you say is an extremely important point, and this is something I say so often. It’s hopefully, I say it’s hopefully a broken record by now cause I want people to hear it so often they get it, which is you should obsess about conversion where optimization before worrying about sending traffic , period.
[00:15:24] Particularly if you’re paying for traffic and oh my goodness. Particularly if you’re paying for off Amazon traffic. Because the conversion rates, generally speaking, and yes, it will vary, are gonna be a lot lower. So if you haven’t home deal optimization and you can’t make a return on investment from Amazon ads, you’re really gonna struggle with other pay ads.
[00:15:41] Now you mentioned another thing which I was gonna put a bit later, as a more sophisticated thing, which is using external tra traffic to build, a list and email list or any other form of lead nurturing, which I think. By far the best way of putting it, but learn that we put it in simple. I suppose within sort of Amazon seller, in the Amazon seller bubble mindset.
[00:15:58] The first thing I would say, everyone’s always upsetting about launching and correctly. So cuz we have the Cold Start problem. Amazon, I think once you’ve honed your game, On using the on housing tools, conversion by optimization, and really aggressive ad spend. If you’re in a competitive market, which many of us are, that is a good time.
[00:16:15] That’s the first place I would say you’re gonna get a good return on investment from your external traffic. Now, when I say return, I wanna be very clear when I’m launching, if I’m digging on behalf of a client for myself, or if I’m advising a client, I would always say your aim is to. Market share, that’s a revenue based metric.
[00:16:32] You will actually lose money. You will lose profit for that period. So you have to account for that in your overall profit and loss analysis on that product over the next year or so. , if you don’t care about profit for the moment because you’re trying to gain rank or in an Amazon way of looking at it, or market share in a more broad business way of looking at.
[00:16:47] I think that’s when throwing, everything at it rather, like the boosters that you put on a SpaceX launch, which then get disposed of within, the first 90 seconds. That’s a time when I think it’s more legitimate to be pretty aggressive and even if you’re somewhat inefficient, but it gets you up the ranking.
[00:17:01] If it’s gonna stick to your point, then it’s worth doing.
[00:17:05] Jason: Yeah. Two thoughts there. Email marketing is the original and best form of internet marketing. It’s just hands down the best. So building an email list in whatever way you can in support of your business, is absolutely the smart thing to lean into.
[00:17:20] Regardless of whether you sell on Amazon or eBay or Etsy or MEO Libre offer up or your own Shopify site, it does not matter. Figure out how to build a list in support of your work and it’ll be helpful. So yeah, I totally agree on that. And it’s so true. This is the most important thing I think to think through is it’s, this whole launch idea, an email list of course, is a huge asset in that regard.
[00:17:43] So it was a social following. And, obviously the the mechanics of knowing how to do paid ads, those are in some, in summary, those are the broad strokes of internet marketing opportunity. Organic socials paid you. Placements around the internet and broadcast, which would be email and text marketing.
[00:18:02] Those are the, that, that’s the whole universe of internet marketing opportunity really. There’s a lot of subcategories under each one of those. But, so I think those, those are the tools, to use. But, I think to, back to your comment about the outline we’re talking about here, the launch, of a Amazon product.
[00:18:16] Absolutely. But I guess my question for you would be, if you are launch. Product on Amazon, Which would you say people should lean into first? The, Amazon marketing ad, I call it ams. I don’t know what the new name is, Amazon AD or external traffic. Would you prioritize Amazon ads first?
[00:18:34] Michael: Absolutely a hundred percent prioritize Amazon ads first. For a few simple reasons. First of all, people don’t have to change platforms, so there’s less kind of resistance there. But I of all, Amazon’s created a place where they have their credit cards on file and people trust Amazon and the conversion rates are very high, and people tend to go on Amazon with a much higher buying intent than any other platform online than I can think of.
[00:18:52] In e-commerce anyway, unless you have an incredible Shopify site or something. So yeah, so I would say a hundred percent Amazon ads and to the point you made earlier. I don’t wanna gloss over that. I think until you have exhausted the stuff you can do on Amazon, I think it’s promis you to go off Amazon.
[00:19:06] Once you’ve done that, as you say, if you’re doing well on Amazon, that’s a good reason to reach externally. The only thing I would say there is if you already have an existing email list, particularly of buyers, Unless you’re over emailing them offers or something, then it, that’s a great, you might as well put the offer out there because just as your audience responded really well, any, audience of prior buyers or people who are very closely associated with you your company or your brand, I’m much more likely to buy.
[00:19:30] So if you have that email list already, it’s a no brainer to use it. The question mark comes more about the Google ad side, I think already paid. Because, Yeah, totally. The economics harder to make work as we discussed earlier, depends on the margin of your pro product.
[00:19:43] One thing I would say is just to protect your Amazon ranking.
[00:19:46] The irony is I’ve seen people try to boost their Amazon ranking, As in the SEO ranking on Amazon of their product for certain keywords by using Google Ads. And they, created the conversion rates to something ridiculous, nor point, not 1% so the way to get around that is to consider an interstitial page, which is one in between where you say, a Google ad for, the best.
[00:20:06] Whatever it is, 50% off, face cream or something, and then a page where you give out the coupon code and then have a link forward to Amazon. So that’s quite important to protect the conversion rate data on Amazon, which Amazon really judges you on. Oh, I had never thought of that before. Yeah, that’s really important.
[00:20:23] The other thing I would say is that people naturally want to get. As much bang for the buck as they can, and I understand this, but they will try and get an interstitial page where they capture somebody’s email and then send them onto Amazon. And in theory, that makes sense of the money you’ve spent. You get a lead out of it.
[00:20:37] And in theory you get somebody going to Amazon. But normally it doesn’t work very well if you have two calls to actions. I would say you’ve gotta either decide if you’re building an email list for the longer term. Or if you think of shorter term, simpler kind of funnels, you’d simply studying it to an interested page, probably giving them a coupon code to increase the like they buy, and then straight onto Amazon.
[00:20:55] So I think it’s one or the other in my experie.
[00:20:58] Jason: Yeah, it doesn’t work very well either, just because of the law of, the large numbers you’re working with. If you send a hundred people to an interstitial page only, let’s just say 5% of ’em will click through to the Amazon page. Yeah. So you’ve got this stack, this stacking of negative.
[00:21:13] Throughput, yes, your a’s gonna have a throughput to your interstitial page, your landing page, and then that page is gonna have a throughput to your Amazon product. And those are like, Super fractional, offense. So it’s it’s gonna really be ugly. So that’s the downside of trying to do it.
[00:21:29] It is. Let me mention one other. Yeah, one other methodology that you could use though if you’re using external traffic sources that will make sense for this, is you could always use like a Bitly link or a short link. And in that way you wouldn’t be capturing their email. But you would be, pickling ’em
[00:21:45] And then you would also know what volume is coming through that link. Because that’s the other problem with external traffic is, let’s just say you spend a hundred dollars on Google AdWords and you drive all that traffic to Amazon. You don’t actually know what. You don’t have that much analytics inside of Amazon, I don’t think.
[00:22:05] Maybe you can correct
[00:22:06] Michael: me if I’m wrong on that.
[00:22:07] I think it’s starting to improve, actually. The Amazon attribution is not something I’ve dug deep into, so I can’t give you it. But my understanding is if you set it up correctly that you can actually get much, much better attribution than used to. So you make a very important point of attribution.
[00:22:21] Jason: Yeah. So if you use like your attribution link, or you could have in the old days, or just you could still do it, use an affiliate, your own affiliate link, sure. Oh.
[00:22:29] Michael: I don’t know about the late, Sorry about that, but
[00:22:30] Jason: yeah. Yeah. So in essence, you can track inside with Amazon’s tools, but to my point, I guess that’s one of the things you gotta figure out is what’s the outcome of the traffic and is it good traffic or bad traffic?
[00:22:42] Cuz if it’s bad traffic, to your point, and it totally ruins your conversion rate, you’re gonna down your, the overall vibe on Amazon, their feeling of your product.
[00:22:52] Michael: Absolutely. And also, that which is inefficient is also like completely waste for your money.
[00:22:56] Wrapup: Folks, I thank you for listening today to the show. Hopefully that sparked some debate in your mind, at least around the question of Amazon external traffic. If you haven’t been thinking about it, maybe you now think considering as an option. Most importantly, if you have been considering spending a lot of money in it in one form or other whether that’s paid ads or a lot of money to generate Google SEO articles, then it’s good to reconsider sometimes.
[00:23:21] So the first question, Really what you’re trying to achieve. Make sure you don’t set false expectations for it and can it be profitable? The discussion we had today does depend on your cost of goods sold and your profit margins. Of course, make sure you’re targeting profit if you actually want profit to come out of the system.
[00:23:37] It’s not built in if you just increase revenue that doesn’t guarantee any increase in profits and perhaps often the reverse. And really thinking about the launch use case for Amazon sellers is, I think, the most helpful thing. And thinking about making sure you actually achieve your objective of ranking your product better on Amazon through organic SEO with a boost from external traffic, how critical is the conversion rate at any given point?
[00:24:03] It depends. When you’re listening to this episode, Amazon seems to go through waves where it will reward or punish Amazon sellers for sending external. And the quality of that traffic. Broadly speaking, Amazon loves external traffic. And in November, 2022 at time of recording, they love external traffic.
[00:24:20] So they might be slightly less fussy than at other times about the conversion rate, but either which way you want to make sure you are sending quality traffic to any website, and that definitely includes Amazon if you want to use it to boost the ranking on. That makes sense. There’s quite a lot that goes into this.
[00:24:36] We haven’t dived into any of the tactics or how do I do specific things like TikTok ads, Facebook ads, Google ads, or any of the specifics. We have covered the external traffic sources, the nine mans of Traffic ads, Jason calls it. So if you want to check out an overview of that and each individual mountain, as it were, each individual traffic channel, then do check out.
[00:24:58] The book, 90 Nines of Traffic by Jason Miles, of course, and I do check out our other. Places as well. Other episodes I should say on the podcast. Final thing to say is if you are an Amazon seller and you want to check whether in fact what you’re doing makes sense in general, which may include external traffic, but more generally about your Amazon business, I’m offering a free.
[00:25:22] 20 minute audit. I’ll spend a bit of time doing some homework, so I’ll send you an email in advance. It’s free. And if you can get that by going to amazing fba.com/amazon audit slash very long url, amazing fba.com/amazon audit. And just look for Amazon Audit, click on that in my calendar and book a time in if that helps you.
[00:25:44] Thanks so much for listening to the eCommerce Leader. Look forward to seeing you in the next show.
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