BB9 - Pricing, PPC, and First Sales!

Branding Blitz

One last thing needed to be done before I could start promoting my product on Amazon... I had to decide what my initial sales price would be. Generally, I would recommend doing that ahead of time... In any case, once that was done I was ready to launch my PPC campaign(s) and get those first sales rollling in!

For the full transcript head to http://brandingblitz.com/9/ or see below.

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Hello again! I'm JR, and you're listening to episode 9 of the Branding Blitz!

Let's go ahead and jump right in here. At the end of episode 8, I mentioned that my products were ready to go live on Amazon. And it's true, the listings were live and the products were available for sale, but there was one last thing I needed to decided before I could start promoting the product.

Believe it or not, I got this far without deciding what price I wanted to start out selling the product for. I had put some consideration into the price I wanted to eventually sell at, but I planned to start at a lower price so that I could build up my sales velocity more quickly and start ranking organically for some keywords so I can get some non-paid traffic.

I mentioned before that the main product is a low priced product which only works because there is such low competition and I can get it so inexpensively. I'll have to do some testing to see what prices the market can handle, but I don't expect it to go above $10. It's a consumable product which I can eventually add variations of with larger quantities and that should be able to sell over $10, but this initial offering probably won't.

I'm okay with that though because my TOTAL product cost including shipping from China, the packaging, the extra business cards I had to get for labels, and shipping to Amazon comes just under 60 cents per unit. So a $10 sale would net about $5.35 cents profit.

All that said, my initial goal is to scoop up as many sales as possible even if I'm only making a marginal profit. Once I'm getting traffic from the regular search results and not just the paid advertising, I'll begin to gradually raise my prices. But I had to figure out where to start at.

I figured a good place to start was by looking at my main competitor. They are merchant fulfilled not FBA – which means it isn't elligible for free shipping. So I took their base price and added their shipping cost to it and tried to just match their price – even though I'm pretty confident my product will be perceived as more valuable.

I ran into a little snag with that plan because at under $6, my product got flagged as an add-on item. Which meant it wouldn't have even been available to purchase at all unless you placed a larger order – I forget if it's $25 or $35... but it doesn't really matter, I didn't want that restriction.

I don't think Amazon has ever clearly defined what qualifies something as an add-on item, but one of the factors is a low price, so I began to play around with the price a bit. Finally I landed at $6.25 per unit. This is less than a dollar more than my main competitor while clearly showing more value because my product is a larger quantity and it was a high enough price that it became prime eligible. So I was confident I would be able to snag some market share at this price.

I set it up so that this was a “sale” price. So it has the “List price” which is marked out and below it is my normal price which is a little lower – that is also marked out. Then finally below that in red it shows the sale price of $6.25 and tells how much money they're saving by getting it at the current price rather than paying full retail.

I net about $2.11 per unit sold at this price, so substantially lower than I'd like eventually, but gives me enough room to do a little bit of lightweight advertising to start generating some sales.

Speaking of generating sales... now that I'd determined what I felt was an optimal starting sale price, I was ready to set up my PPC campaigns. I set up three separate campaigns.

The first campaign I set up was just an automatic campaign. This lets Amazon choose some keywords it thinks are a good fit and start promoting you on those.

The second campaign were the obvious keywords I could think of regarding my product. Think about what you would type in if you were searching for your product. In fact start slowly typing some of those into the search bar on Amazon. They have a predictive text feature which tries to guess what you might be looking for as you type – and sometimes it can give some helpful hints of different things people might type in for your product. Add those to your campaign. Think of different words you could substitute or different ways you could describe the product.

For the third campaign, I went to the Google Keyword Planner. It's a free tool Google provides to help people set up AdWords campaigns. And one of the features allows you to put in a webpage and let Google scan it and decide what it thinks might be relevant keywords. I simply put in the URL for the product listing and downloaded the list of what it came up with and put that straight into the PPC campaign on Amazon.

Some of the suggestions it came up with weren't all that helpful like, “where are the amazon distribution centers,” I doubt anyone is ever going to search that on Amazon and click the link to my product. A bunch of the suggestions were spot on, and some of them were related, but I'm not sure how effective they'll be.

But at this point, you really don't need to do a lot of filtering because the goal of this is to see what keywords are successful and sometimes it's not the main ones you think will be. Sometimes it's the more obscure indirectly related ones that convert especially well.

So I'll run this for a while without filtering out the bad ones. Once I've gotten enough results to see that something is either costing way too much per click or isn't converting then I'll take it out. If something is doing really well I may increase my bid for it – although I think I've got it set where I have a page-one bid for most of the relevant search terms.

It was Friday, July 10th, 2015 when I got this all set up, my first product went live and I began advertising. Within a couple of hours from the time I set up the PPC campaigns, I had received my first sale – I could officially say my new brand had a product selling on Amazon. And I had spent 88 cents on 3 clicks at that point – less than half of my profit margin sounded pretty good when I would have been happy to break even. Later that day I got a second sale and the PPC campaign was still well within ideal limits.

So I ended my first day live having sold 2 units and made a dollar or so on each one. Not quite time to begin planning my retirement, but I have to say it felt like a good start as we headed into my first weekend selling this new product. I was and am anxious to see what the coming days and weeks hold.

I also realized that day that Amazon was promoting July 15th as “Prime Day”. I obviously am not a big enough seller to be included in the sales they're promoting, but it should still garner me some extra traffic since they're promoting this thing so heavily. Should be interesting to see what happens – I'll report back once those numbers are in!In the meantime, there's a full transcript of this episode available on brandingbliz.com/9 I'd love it if you stopped over there and left a comment about the show. I really appreciate your feedback!

Another way you can let me know you're enjoying this show is by letting me know what questions you have about selling on Amazon, sourcing a product, or developing a brand. To do that, head over to brandingblitz.com/ask and leave me a question.

Finally, would you subscribe to the show on iTunes? Each new episode comes with a complete 100% moneyback satisfaction guarantee. And hey, while you're there could you go ahead and leave me a review? I'd really appreciate it!That's it for this show, I'll catch you next time on episode 10 – that's right, we're headed for double digits on episode 10 of the Branding Blitz!